CHENNAI: The Madras High Court on Tuesday warned Income-Tax department counsel K Ramaswamy to mind his words, during the course of arguments on petitions challenging the Economic Offences Court’s order directing Chief Minister J Jayalalithaa and V K Sasikala to appear in court on October 1 in connection with an IT returns case, on Tuesday.
What annoyed Justice K B K Vasuki was the remarks made by Ramaswamy to the effect that the lower court (EO) was acting as an advocate for the other side. Ramaswamy promptly apologised, after which the judge reserved her orders for Wednesday.
By his September 18 order, the Additional Chief Metropolitan Magistrate (EO-I) had directed the CM and her friend to appear before the court on October 1 for questioning under 313(1)(a) of the CrPC and framing of the charges.
Earlier, senior counsel B Kumar, defending the CM, argued that the main objective of the amended guidelines of the Central Board of Direct Taxes (CBDT), which allowed assesses to file compounding applications, was not to harass them and to avoid treating them as criminals. The compounding application, which was made by the duo to the department on June 25 this year has an outer time limit up to December 24, giving 180 days to decide on it. According to the new guidelines, the IT department counsel has to file an application before the trial court seeking adjournment of the proceedings immediately after the application for compounding is made before the CBDT by the assessees. Till a decision is arrived at on the compounding application made by the Board, the criminal proceedings have to be kept in abeyance, Kumar added.
Defending Sasikala, senior advocate Navaneethakrishnan argued that Section 279(2) of the Income Tax Act permitted the assesses to file applications for compounding either before or after the initiation of criminal proceedings and hence it was a binding factor on the authorities. Pending compounding application, no proceedings could be instituted, he added.