Crlp/2684/2022 Of M/S. Tirumala Tirupati Constructions India (P) Ltd. And Another v. Assistant Director Of Income Tax (Investigation)

IN THE HIGH COURT AT HYDERABAD WEDNESDAY ,THE SIXTH DAY OF SEPTEMBERTWO THOUSAND AND TWENTY THREE PRESENTTHE HONOURABLE SMT JUSTICE G.ANUPAMA CRIMIN AL PETITION NO: 2684 2022 Between: M/s. Tirumala Tirupati Constructions [lndia ][(P) ][Ltd. ][Reg. Office. H.No.. 2-2-]23122tD12, DD Colony, Shivam [Road, Amberpet, ][Hyderabad Rep, ][by. ][i-t9]Managing Director. Sri K. [P. ][V. Subbaiah, S/o Late. Sri ] [Ramaiah, ]{ged [6!]Yearsl Occ.. Business, Address. [Flat ][- ][503, ][AsvisidhNovateur ][Nest ][2]Apartments, Gouthami Enclave, [Kondapur, Hyderabad.]23122tD12, DD Colony, Shivam [Road, Amberpet, ][Hyderabad Rep, ][by. ][i-t9]Managing Director. Sri K. [P. ][V. Subbaiah, S/o Late. Sri ] [Ramaiah, ]{ged [6!]Yearsl Occ.. Business, Address. [Flat ][- ][503, ][AsvisidhNovateur ][Nest ][2]Apartments, Gouthami Enclave, [Kondapur, Hyderabad.] 2Sri K P V Subbaiah, S/o Late. Sri [K. Ramaiah, ][Aged ][65 ][Years, ][Occ. Business,]Maanaging Director of M/s. Tirumala [Tirupati ][Constructions ][lndia ][(P) ][Ltd]Addresi. [-ftat ]- SOS, AsvisidhNovatetirr [Nest ][2 ][Apartments, ][Gouthami]Enclave' Kondapur' Hyderabad' Maanaging Director of M/s. Tirumala [Tirupati ][Constructions ][lndia ][(P) ][Ltd]Addresi. [-ftat ]- SOS, AsvisidhNovatetirr [Nest ][2 ][Apartments, ][Gouthami]Enclave' Kondapur' Hyderabad' ...pETrroNERs/AccusED No.'r & [2] AND Assistant Director of lncome Tax [( ][lnvestigation), ][UNIT-ll ][(2), ][Room ][No. ][467 ]' [3td]Floor, Aayakar Bhavan, Basheerbagh, [Hyderabad ][- ][500029 ][Represented ][by ][Special]Public Pr6secutor, High Court of Telangana, [Hyderabad] ...RESPONDENT/COMPLAINANT Petition under Section 482 of Cr.P.C [praying ][that ][in ][the ][circumstances]stated in the Memorandum of Grounds [of ][Criminal Petition, the High Court may be]pleased to pass an order quashing C.C. No. 263 of 2017 [on ][the ][File ][of ][Special]Judge for Economic Offence, Nampally, [Hyderabad against the Petitioners herein.] l.A. NO: 2OF 2022 Petition under Section 482 of Cr.P.C [praying ][that ][in the ][circumstances]stated in the Memorandum of Grounds [of ][Criminal Petition,the High Court may be]pleased to stay all further proceedings including appearance [of ][the ][Petitioner ][in]C.C. No. 263 of 2017 on the [File ]of [Special Judge ][for ][Economic ][Offence,]the [Petitioner herein ][is ][concerned ][.]Nampally, Hyderabad insofar [as ] This Petition coming on for hearing,upon [perusing ][the ][Memorandum ][of]Grounds of Criminal Petition and upon [hearing ][the ][arguments ][of ][Sri ] [Ravi]Senior Counsel for Sri R.S. ASSOCIATES ,Advocate [for the ][Petitioner ][and ][Sri ][A.]Ramakrishna Reddy representing Smt. K. [Mamata ][Standing ][Counsel ][for ][the]Respondent The Court made the following: ORDER THE HONOURABLE SMT G. ANUPAMA [CHAKRAVI{RTHY]cRIMINAL PETITION No.2684 of 2022 ORDER: This petition is filed under Section 482 of [Oode ][of]Criminal Procedure (for short ['Cr.P.C.') ]blr [the]petitioner/ accused seeking to quash the [proceedings ]inC.C.No.263 of 2017, [pending ]on the hle of [the ][Spe<:ial ][Judge]for Economic Offences, Nampally, Hyderabad. 2. The respondent herein is the complainant, [r,r'ho ][has ][a]complaint under Section 19O R/w. Section 2OO [of Cr.l).C. ][for]the offences punishable under Sections 276C(1) and 2788 ofthe Income Tax Act, 1961 (for short "the Act"). 3. The facts culled out from the complaint are that asurvey operation under Section 133A of the Act was <;arriedout on 25.05.2016 by the D.D.l.T.(Inv), Unit-II, Hyderabad incase of certain assessees. During the course of the survey itwas found that the petitioners herein have sold the Lmd atBudvel to different parties in the Assessment Years 20 15-2O16 and 2016-2017 at the rates belorv the val e of tht: Sub- 2. The respondent herein is the complainant, [r,r'ho ][has ][a]complaint under Section 19O R/w. Section 2OO [of Cr.l).C. ][for]the offences punishable under Sections 276C(1) and 2788 ofthe Income Tax Act, 1961 (for short "the Act"). 3. The facts culled out from the complaint are that asurvey operation under Section 133A of the Act was <;arriedout on 25.05.2016 by the D.D.l.T.(Inv), Unit-II, Hyderabad incase of certain assessees. During the course of the survey itwas found that the petitioners herein have sold the Lmd atBudvel to different parties in the Assessment Years 20 15-2O16 and 2016-2017 at the rates belorv the val e of tht: Sub- Registrar Offrce. It is further contended that the petitionersherein have sold the properties and realized the money anddid not file income tax returns and [did ][not ][pay ][any tax ]for thesaid assessment years and the [summons were issued ][to ][the]petitioners to show cause as to why prosecution should notbe initiated against them as the [tax ][was ][willfully ][avoided ][by]the petitioners for the said assessment [years.] 4. Basing on the said complaint, the Special Court [of]Economic Offences, Hyderabad [registered ][and ][numbered ][the]case as C.C.No.263 of 2Ol7 for [prosecution ][against ][the]petitioners for the offences punishable under [Sections]276c(ll and278B oftheAct, 1961. 5. As already stated supra, challenging [the ][. ][said]proceedings in C.C.No.263 of 2017, the [petitioners ][have filed]this quash petition contending that the initiation [of ][the]prosecution against the petitioner is illegal and void ab-initio. 6. It is the specihc contention of the petitioners that theauthorization under Section 279(1,1 of the Act was issued by AAC,Jcrl-P.No.2ta4 oJ 2022 the Principal Director of Income Tax [(Inv.), Hyderabad, ][to the]Deputy Director of Income Tax [(lnv.), ]Unit-ll, [Hyderabad and]that the Principal Director of Income [Tax ][is ][not ][the ][corrpetent]authority to accord sanction under Section 279(l) [of ][the ][Act.]Even assuming for a moment that the Deputy [Dire<:tor ][of]Income Tax is the authority to accord sanction, it [has ]to [be]seen that the said sanction was to the Deputl' [Dire<'tor ]ofIncome Tax. But the prosecution has been initiated ['by ][the]Assistant Director of Income Tax, who is lou'er in rank [to ][the]Deputy Director of Income Tax. Therefore, the complilinantdoes not have any authorization to initiate the [proser:ution]and further the respondent is not having [jurisdiction.] The respondent respondent has frled a detailed counter afltdavitfrled a detailed counter afltdavita detailed counter afltdavitdetailed counter afltdavitcounter afltdavitafltdavit 7 . The respondent respondent has frled a detailed counter afltdavitfrled a detailed counter afltdavita detailed counter afltdavitdetailed counter afltdavitcounter afltdavitafltdavitdenying all the contentions of the petitioner. It is speci[rcallystated in the counter-afhdavit that the survey operationunder Section 133,4 of the Act was conducted on M/s.Tirumala Tirupati Constructions India h/t. Ltd. On25.05.2016. During the course of the survey proceedings, itwas noticed that during the financial year 2Ol4-2O15, rr,hichis relevarrt to the assessment year 2Ol5 2016, the pt:titioner The respondent respondent has frled a detailed counter afltdavitfrled a detailed counter afltdavita detailed counter afltdavitdetailed counter afltdavitcounter afltdavitafltdavit 7 . The respondent respondent has frled a detailed counter afltdavitfrled a detailed counter afltdavita detailed counter afltdavitdetailed counter afltdavitcounter afltdavitafltdavitdenying all the contentions of the petitioner. It is speci[rcallystated in the counter-afhdavit that the survey operationunder Section 133,4 of the Act was conducted on M/s.Tirumala Tirupati Constructions India h/t. Ltd. On25.05.2016. During the course of the survey proceedings, itwas noticed that during the financial year 2Ol4-2O15, rr,hichis relevarrt to the assessment year 2Ol5 2016, the pt:titioner company has sold land admeasuring Ac.25.31 guntas atBudvel Village, Rajendranagar Manda.l, Ranga Reddy District,for a total sale consideration of Rs.9.115 crores as againststamp duty va-lue of Rs.62.36 crores. Accordingly, a hnalsurvey report was prepared and forwarded to respectiveAssessing Officers. Subsequently, for the financial year 2Ol4-2015 relevant to the Assessment Year 2015-2016, scrutinyassessment under Section L47 of the Act was completed on26.12.2079 by adopting the stamp duty value as full value ofconsideration received as per Section 43CA R/w Section 50Cof the Act and added back the duties in the sale considerationof RS.48,69,O0,00O/- (Rupees Forty tright Crores Sixty NineLakhs Only) to the income tax admitted resulting in ademand of Rs.31,57,78,O25 /- (Rupees Thirty One CroresFifty Seven Lakhs Seventy Eight Thousand Twenty Five Only).Later, a rectification was passed under Section 164 of the Acton I9.Oa.2O21 torevising the total demand Rs.3 1,74,66,956/ - (Rupees Thirty One Crores Seventy FourLakhs Sixty Six Thousand Nine Hundred and Fifty Six Only).The survey operation was conducted on 21.05.2016 and later EAC'Jc.l.P.No.25a4 oJ 2022 it was noticed that during [the hnancial ][yeats ][2Ol4-2015 ][and]2015-2016, relevant to [the ][assessment ][years ][2015-2O16 ][and]2Ot6-2O17 , the. petitioner [sold ][Ac.39.1 ][1 ][guntas ][of ][land ][at]Budvel Village, Rajendranagar [Mandal, ][Ranga Reddv ][ttistrict,]for a total sale consideration [of ][Rs. ][11'24 ][crores ][as ][against ][the]Sub-Registrar Offrce value of [Rs'92.61 crores ][but ][has ][not]disclosed the income tax [from the ][sale of ][property for ][tzr.xation]either under the head 'lncome [from Capital ][Gains' ][or ]['lncome]from Business'. Similarly, there [were ][cash ][deposits ][in ][the]bank accounts of the [assessee ][to ][the tune ][of ][Rs.47.7O ][lakhs,]which remained unexplained [and ][in ][the ][absence ][of ][bc'oks ][of]account maintained by the [assessee ][company ][is ][deeme'l to ][be]the income of the company. Further, [the ][petitioner-cornparly]has not filed Income Tax Return [for the ][assessing ][year ][2O15]2016 within the due date [prescribed ][under ][the ][Act, ][i.e. ][on ][or]before 30.O9.2015. 8. . [Heard ][Sri S. ][Ravi, learned ][Senior Counsel ][for ][the]petitioners and Sri A. Ramakrishna [Reddy, ][learned ][StzLnding]Counsel for the respondent. \ I i I GAC'Jcrl.P.No.2584 of 2022 9. It is the specihc contention of the learned SeniorCounsel that there shall be sanction under Sectio n 279(ll ofthe Act. As per the said sanction, dated 3O.O3.2O17, thePrincipal Director of Income Tax (lnv.), Hyderabad issuedsanction under Sectio n 279(Il to the Deputy Director [of]Income Tax (Inv.), Unit - II, Hyderabad to file a [complaint]before the Special Judge for Economic Offences, Hyderabadagainst the petitioner-company. But the complaint [was ][filed]by the Assistant Director of Income Tax (lnv.), Unit-ll,Aayakar Bhavan, Basheerbagh, Hyderabad, towhom [the ][said]sanction has not been granted, which is a [grave ][irregularily]as per the Act. Therefore, he prays to [quash ]the impugnedproceedings. \ I i I GAC'Jcrl.P.No.2584 of 2022 9. It is the specihc contention of the learned SeniorCounsel that there shall be sanction under Sectio n 279(ll ofthe Act. As per the said sanction, dated 3O.O3.2O17, thePrincipal Director of Income Tax (lnv.), Hyderabad issuedsanction under Sectio n 279(Il to the Deputy Director [of]Income Tax (Inv.), Unit - II, Hyderabad to file a [complaint]before the Special Judge for Economic Offences, Hyderabadagainst the petitioner-company. But the complaint [was ][filed]by the Assistant Director of Income Tax (lnv.), Unit-ll,Aayakar Bhavan, Basheerbagh, Hyderabad, towhom [the ][said]sanction has not been granted, which is a [grave ][irregularily]as per the Act. Therefore, he prays to [quash ]the impugnedproceedings. 10. On perusal of Section 279(ll of the Act would show thatthe sanction has to be accorded by an officer at the [level of]Chief Commissioner of Income Tax/ Director General [of]Income Tax. However, in the present case the sanction [has]been accorded by the Frincipal Director of Income Tax, who isIower in rank than the Chief Commissioner of Income Tax,and even assuming for a moment that the Principal Director:7 GAC,Jcrl.P.No.r'6A4 of 2022 of Income Tax is the authority to accord sanction, thesanction clearly discloses that it was accorded to the DeputyDirector of Income Tax but not Assistant Director of [Income]Tax. As stated supra, in the present case it is the As;sistantDirector of Income Tax, who has [preferred ]the complaint, islower in rank to the Deputy Director of Income Tax. 1 1 . On the other hand, it is the specific contention of thelearned standing counsel that, as per Section 319(1)(a) of theAct, every person being company or firm, shall, on or beforedue date, furnish a return on its income during the previousyear in the prescribed form and verified in the pres;cribedmanner and setting forth any such other particulars a.s maybe prescribed. And as the petitioner-company has nc,t filedthe returns of the income tax for the assessing year 2015-2016 within the stipulated time, the authorities have everyright to initiate prosecution against the petitioner-compi:rny. 12. It is further contended by the learned counsel firr therespondent that except the sanction of the PrincipalCommissioner of Income Tax, there cannot be any\\ ,i /y' prosecution and in the present case, the Principal Director ofIncome Tax (Inv.) has issued sanction and as per [Section]2(16) of the Act, Commissioner means the [person ]appointedto be the Commissioner of Income Tax or the [Director ][of]Income Tax or a Principal Commissioner of [lncome ][Tax ]or [a]Principal Director of Income Tax under sub-section [( ]1) [of]Section 117, there is no error or irregularity by [issuance ][of]sanction by the Principal Director of Income [Tax.] 13. It is also contended by the learned Standing Counselthat in the present case, initially, the sanction [was ]issued [to]the Deputy Director of Income Tax for launching [prosecution]proceedings against the petitioner company. Meanwhile,during the interregnum period of [processing ]the case [for]prosecution, there was a change in the incumbency due toAnnual General Transfers of the Officers and in his [place ]anAssistant Director of Income Tax was [posted, ]who had filedthe prosecution complaint in the Court of la'*,. 14. It is the specific contention of the learned StandingCounsel that the duties performed by the Deputy Director of GAC,Jcrt.P.No.26a4 of 2022 Income Tax as well as Assistant Director of Income Tax areone ald the same, excepting that a senior officer will betermed as Deputy Director of Income Ta-x and a junio;: ofhcerone ald the same, excepting that a senior officer will betermed as Deputy Director of Income Ta-x and a junio;: ofhceras Assistant Director of Income Tax. Therefore, there is noerror or irregularity in the present case for latLnchingerror or irregularity in the present case for latLnchingprosecution against the petitioner-company by the As.sistantDirector of Income Tax.Director of Income Tax. 14. It is the specific contention of the learned StandingCounsel that the duties performed by the Deputy Director of GAC,Jcrt.P.No.26a4 of 2022 Income Tax as well as Assistant Director of Income Tax areone ald the same, excepting that a senior officer will betermed as Deputy Director of Income Ta-x and a junio;: ofhcerone ald the same, excepting that a senior officer will betermed as Deputy Director of Income Ta-x and a junio;: ofhceras Assistant Director of Income Tax. Therefore, there is noerror or irregularity in the present case for latLnchingerror or irregularity in the present case for latLnchingprosecution against the petitioner-company by the As.sistantDirector of Income Tax.Director of Income Tax. 15. The learned Senior Counsel for the petitioners in orderto support his contentions, relied on the following judgrnents. 15. I The judgment of the Delhi High Court in the <:ase ofCotnmissioner of Income Tox Vs. Spl's Siddha rtha Ltdrand brought to the notice of this Court paragraph Nos 8 and9 which reads ag under: "8. Thus, if authority is given expressly byaffirmative words upon a defined defined condition,the expression of that condition excludes the doingof the Act authorised under other circumstancesthan those as defined. It is also establishedprinciple of law that if a particular authority hasbeen designated to record his/her satisfaction onany particular issue, then it is that authority alonewho should apply his/ her independent mind torecord his/her satisfaction and further mandatorycondition is that the satisfaction recorded shouldbe ["independent" ]and not [,'borrowed" ]or [,,dictated,,] 1 MANU lyD l7 t6s /201r l GAC'J2022..-., crt-P-No.26A4 ol 2022 satisfaction. Law in this regard is now sell-settled. In Sheo Narain Jaiswal & Ors. Vs. ITO,176ITR 35 (Pat.), it was held: Where the Assessing Officer does not himselfexercise his [jurisdiction ]under Section 14 butmerely acts at the behest of any superior authority,it must be held that assumption of [jurisdiction ][was]bad for nonsatisfaction of the condition [precedent.] 9. The Apex Court in the case [of] Anirudh-Sinhji Karan Sinhji Cinhii ladeia JadejaVs. State of Gujarat, MANU/SC/O473/1995 [(19951]5 SCC 302 has held that if a statutory [authority]has been vested with [jurisdiction, ]he has [to]exercise it according to its own discretion. Ifdiscretion is exercised under the direclion or [in]compliance with some higher authoritiesinstruction, then it will be a case of lailure [to]exercise discretion altogether. ["] As per the above precedent it is evident that if [a] statutory authority has been vested with [jurisdiction, ][he ][has]to exercise it accordingly and if discretion is exercised [under]the directions or in compliance of some higher authority'sinstruction, then it would be a case of failure to exercisediscretion altogether. 15.2 The [judgment ]of the Madras High Court in the case [of] P.R.P. Granltes Vs. Check-Post OfJicer/AssistantCornmercial Iax OlJicer, Puzhal Check-Post(Incoming), Chennai2 and brought to the notice of this Court paragraph No.15 r.r,hich reads as under: As per the above precedent it is evident that if [a] statutory authority has been vested with [jurisdiction, ][he ][has]to exercise it accordingly and if discretion is exercised [under]the directions or in compliance of some higher authority'sinstruction, then it would be a case of failure to exercisediscretion altogether. 15.2 The [judgment ]of the Madras High Court in the case [of] P.R.P. Granltes Vs. Check-Post OfJicer/AssistantCornmercial Iax OlJicer, Puzhal Check-Post(Incoming), Chennai2 and brought to the notice of this Court paragraph No.15 r.r,hich reads as under: " 15. Tl're respondent is hereby directed to release thegoods along with the vehicles, which are the subjt:ctmatter of the G.D. Nos. 1329, 1330 and 13111 ofmatter of the G.D. Nos. 1329, 1330 and 13111 of2OO3-2OO4 dated August 16, 2OO3 forthwith on t.repetitioner furnishing an undertaking that tl-resubject goods will not be parted with or alienated f ora period of six months within which period therespondent can take any action, if so warranted, insubject goods will not be parted with or alienated f ora period of six months within which period therespondent can take any action, if so warranted, inaccordance with law for recovery of any tax legallyliable from the petitioner. I am constraineJ _oconclude this order with a note of caution to ttreconclude this order with a note of caution to ttreauthorities under the Act to the effect that ar.yaction taken by the authorities must have th.esanctior-t of law and supported by provisions of [avz.Otherwise,. the same would amount to illegal actionand harassment of unwary public for eitraneousreasons, which is not authorised under any law anlcannot be the intention of the law makers. With thisobservation the writ petitions are allowed."cannot be the intention of the law makers. With thisobservation the writ petitions are allowed." As per the above said proposition, the authoritywhich has initiated the prosecution must have sanction oflaw. Otherwise, it amounts to illegal action. 15.3 The learned Senior Counsel for the petitioner fu.rtherrelied on the judgment of the Hon'ble Apex Court in thecase of Sate of uttar pradesh ys. Singhara Singh crnd others3 and brought to the notice of this Court [paragraph] No.8, which reads as under: "8. The rule adopted in Taylor v. Taylor is wellrecognised and is founded on sound [principle. ][Its]result is that if a statute has conferred a [power ]todo an act and has laid down the method in [which]that power has to be exercised, it necessarilyprohibits the doing of the act in any other mannerthan that which has bene prescribed. The [principle]behind the rule is that if this were not so, [the]statutory provision might as well not have [been]enacted. A Magistrate, therefore, cannot in [the]course of investigation record a confession [except in]the manner laid down in Section 164. The [power ][to]rccord the confession had obviously been [given ][so]that the confession might be proved by the recordof it made in the manner laid down. If [proof ][of ][the]confession by other means was [permissible, ]thewhole provision of Section 164 including thesafeguards contained in it for the [protection ][of]accused persons would be rendered nugatory. [The]section, therefore, by conferring on Magistrates thepower to record statements or confessions, bynecessary implication, prohibited as Magistratefrom giving oral evidence of the statements [or]confessions made to him." The ratio formulated. as per the above [precedent ][is]that if a statute has conferred a [power ]to act and [has laid]down the method, any power must be exercised discreetly,which prohibits doing of act in any another manner. Whichmeans, if a sanction has been granted to the Deputy 3 (t964]' 4 SCR 485 I I GAC,Jcrt.P.No.26a4 ol 2022 director to launch prosecution against the petitioner-company, it is for the Deputy Director alone to launch thecompany, it is for the Deputy Director alone to launch theprosecution but not the Assistant Director. The ratio formulated. as per the above [precedent ][is]that if a statute has conferred a [power ]to act and [has laid]down the method, any power must be exercised discreetly,which prohibits doing of act in any another manner. Whichmeans, if a sanction has been granted to the Deputy 3 (t964]' 4 SCR 485 I I GAC,Jcrt.P.No.26a4 ol 2022 director to launch prosecution against the petitioner-company, it is for the Deputy Director alone to launch thecompany, it is for the Deputy Director alone to launch theprosecution but not the Assistant Director. 15.4 The judgment of the Hon'ble Apex Court in the caseof Suresh Kumar Bhikanncho,nd. Jain Vs, Pandctg AjagBhushan and Others [+and ]brought to the notice of thisCourt paragraph No.24 which reads as under: '24. In Matajog's case, 1995 (21 SCR 92S theConstitution Bench held that the complaint may n()tdisclose all the facts to decide the question ofapplicability of Section 197, but facts subsequentlycoming either on police or judicial inquiry or even in thecourse of prosecution evidence may establish thenecessity for sanction. In S.B. Saha's case (1979 (4) SC()177 , the court observed that instead of confining itself t,tthe allegations in the complarnt the Magistrate can tak,linto account all the materials on the record at the tim,:when the question is raised and falls for consideration.In Pukhraj's case, (supra) this court observed thatwhether sanction is necessary or not may depend fr-orrrstage to stage. In Matajog's case the Constitution BenctLhad further. observed that the necessity for sanction ma1,reveal itself in the course of the progress of the case imcit would be open to the accused to place the material onrecord during the course of trial for showing u,hat hisduty was and also the acts complained of were so interrelated with his official duty so as to attract theprotection afforded by Section 197 of the Code ofCriminal Procedure. This being the position it would beunreasonable to hold that accused even though mighthave really acted in discharge of his olficial duty iorwhich the complaints have been todged yet he will haveto wait till the stage under sub section (4) Section 246 of o 11BSa1 t Supreme Court Cases 2O5 GAC'J crl.P-No.26a4 oI [2022] the Code reaches or at least [till ]he will be [able ][to ][bring]in relevant materials [while ]cross [exarnining ][the]prosecution witnesses. On [the ]other had it [would ][be]iogical to hold that the matter [being ]one [dealing ][with ][the]jurisdiction o[ the court to take cognisance, the accusedwould be entitled to produce [the ]relevant [and ][material]documents which can be [admitted ][into ][evidence ][without]formal [proof, ]for the limited [consideration ][of ][the ][court]whether the necessar5r ingredients to attract [Section ][197]of the Code have been established [or not. ][The ][question]of applicabitity of Section [197 ]of [the ][Code ][and ][the]consequential ouster of [jurisdiction ][of ][the ][court ][to ][take]cognisance without a valid [sanction ][is ][genetically]difierent from the plea [of the ][accused ][that ][the]averments in the complaint [do ][not ][make ][out ][an ][offence]and as such the order of [cognisance ][ald/or ][the criminal]proceedings be quashed- In [the ]aforesaid [premises ][were]are of the considered opinion [that ][in ][accused ][is ][not]debarred lrom producing [the ][relevant ][documentary]materials which can be [legaliy looked ][into ][without ][aly]formal proof, in support [of ][the ][stald ][that ][the ][acts]complained of were [committed ][in ][exercise ][of ][his]jurisdiction or purported [jurisdiction ]as a [public ][servant]in discharge of his official [duty ][thereby ][requiring]sanction of the appropriate [authority."] As per the above [precedent, ][it ][is ][no ][longer ][a]dispute as indicated [by ][the ][Hon'ble Apex ][Court ][in]several cases that [the ][question ][of ][sanction ][can ][be]considered at [any ][stage of ][the proceedings'] As per the above [precedent, ][it ][is ][no ][longer ][a]dispute as indicated [by ][the ][Hon'ble Apex ][Court ][in]several cases that [the ][question ][of ][sanction ][can ][be]considered at [any ][stage of ][the proceedings'] 16. On the other [hand, the ][learned Standing Counsel ][for]Income Tax [relied ][on ][the judgment ][of ][the ][Hon'ble ][Apex]Court in the [case ][of ][P. ][Jagappan Vs' S'K' Perumal, ][First] I l, s, \- GAC,Jcrl.P.Na.26a4 ol2022f?Os. The ratio formulated in the said [judgmen', ]is thatreassessment proceedings cannot act as bar for init-iation ofcriminal prosecution and there cannot be q'rash ofproceedings under Section 482 of Cr.P.C. The above citationis not applicable to the facts ald circumstances of the case,as the petitioner is challenging the fact that the respondentNo, 1 did not have any power to launch the pror;ecutionproceedings as the sanction was granted to the DeputyDirector 17. Perusal of the entire record, rival contentions cf boththe parties and the precedents relied upon by thern, it isevident that once sanction has been given to a particularauthority, i.e., the Deputy Director of Income Tax, theprosecution has to be launched by him alone and not bythe Assistant Director of Income Tax, who did not hzLve thepower to launch the prosecution proceedings. Thoup,h it isthe contention of the learned Stalding Counsel f,rr therespondent that the Deputy Director of Income Tax is a s [19841 19 Ta-xman 1 (SC) II GAC,.' c.I.P.No.25a4 of 2022 senior officer and the Assistant Director of Income [Tax ][is ][a] junior officer and both were doing the same duties, thesaid contention cannot be taken into consideration as [in]the present case, the sanction is accorded to the [Deputy]Director of lncome Tax for initiating prosecution [and ][not ][to]the Assistant Director of Income Tax. 18. In view of the above discussion, this Court [is ][of ][the] considered opinion that it is a fit case to [quash ][the]proceedings against the petitioner. 19. Accordingly, the Crimina-l Petition is [allowed ][and ][the]proceedings against the petitioner/ accused in C.C.No.263of 2Ol7 on the file of the Special Judge [for ][Economic]Offences, Nampally, Hyderabad, are [hereby ][quashed.] Miscellaneous applications [pending, ]if any, shall standclosed. Sd/. AV.S. PRASADSECTION OFFICER PRASAD//rRUE coPY// [AsslsrtuEclsrRAR] r \\Tolr SECTION $,I\r'iiii,rif.l Tde Special Jidge for Economic Offence, Nampally, Hyderabad."1Eri. 2.1 The Assistant Director of lncome Tax ( lnvestigation , Unit -ll (2), RoomiiI,t Ii [No. ][467 ][, 3'd ][Floor, Aayakar Bhavan, ][Bisheerblgh, ][Hyderabad'. ]["]Iiit3.i One CC to M/s. R.S. ASSOCIATES, Advocate IOPUCInn.If itj, iciii' 4.i Oire 4.i Oire Oire CC to Smt. K. MAMATA, S.C. for I.T. Dept. IIit5.1 It T'ivo cD CoPiesrIt T'ivo cD CoPiesrT'ivo cD CoPiesrcD CoPiesrCoPiesrrL];.tl;t iIiiiKULdf + iI$,I\r'iiii,rif.l Tde Special Jidge for Economic Offence, Nampally, Hyderabad."1Eri. 2.1 The Assistant Director of lncome Tax ( lnvestigation , Unit -ll (2), RoomiiI,t Ii [No. ][467 ][, 3'd ][Floor, Aayakar Bhavan, ][Bisheerblgh, ][Hyderabad'. ]["]Iiit3.i One CC to M/s. R.S. ASSOCIATES, Advocate IOPUCInn.If itj, iciii' 4.i Oire 4.i Oire Oire CC to Smt. K. MAMATA, S.C. for I.T. Dept. IIit5.1 It T'ivo cD CoPiesrIt T'ivo cD CoPiesrT'ivo cD CoPiesrcD CoPiesrCoPiesrrL];.tl;t iIiiiKULdf + iI j, i' 4.i Oire 4.i Oire Oire 5.1 It T'ivo cD CoPiesrIt T'ivo cD CoPiesrT'ivo cD CoPiesrcD CoPiesrCoPiesrrl;t i+ iI DL iIt ,lItIIi.,i]sg.:iIstI!!!!1:iIIfIiHIGH COURTDATED:06/09/2023I :,.1,;jjIa,i,. i':ii{| ! iJt. :tt. ii!ri lII;:!B.i..{IIi.IoRDEREt'i ll;. rTIiiI t.r:i(. 1?ICRL.PETITION TNo.2 84 6Iiol 2022lI .t i'!.tI;ii.:ALLOWING TI{E CRE.PETITIoN., I ri''.li r,\- :, [,,].t,lE!.sta* [,- ][r-- ]t 1t-. t{.c:1Igj'rL,-, t 1-.! 'J:'i " [.t ]$. [t! ]1 ilAi4tIs.. l_ i,, r.to.H..'1 }ifl.. I1ir i-' $.ft?iI:v "; I!,rlTi:i'L.:i-,:i .:.r:, [.l;]-,i .r..i.,'i[,s!it4I,lIIIa1rlI -: .,.r1 . r c, ,'-, t,,)a [r,]cQt [1\11].-l\\\ t)\l