Karti P.chidambaram v. The Deputy Director Of Income Tax (Investigation), Unit-3(2), Room

IN THE HIGH COURT OF JUDICATURE AT MADRAS RESERVED ON : 10.03.2020DATE OF DECISION : 12.05.2020 CORAM : The Hon'ble Mr.JUSTICE M.SUNDAR Criminal O.P.Nos.22136, 22137 of 2019, 1526 and 1527 of 2020 and Crl.M.P.Nos.11481, 11482 of 2019, 944 and 946 of 2020 1.Srinidhi Karti Chidambaram. 2.Karti P.Chidambaram .. Petitioners in Crl.O.P.No.22136 of 2019 and Crl.O.P.No.1527 of 2020 Karti P.Chidambaram.. Petitioner in Crl.O.P.No.22137 of 2019 and Crl.O.P.No.1526 of 2020 Vs. 1. The Deputy Director of Income Tax (Investigation), Unit-3(2), Room No.120, 1[st] Floor, Investigation Wing Building, No.45, Old No.108, Uthamar Gandhi Road, Nungambakkam, Chennai-600 034. 2. The Registrar, Hon'ble Special Court for Trial of Criminal Cases related to MPs/MLAs of Tamil Nadu, Singaravelan Maaligai,Chennai-600 001. (R-2 stands deleted vide this order) 3. The State of Tamil Nadu rep by Chief Secretary to Government, Home Department, Fort St. George, Chennai-600 009. 4. The Registrar General, High Court, Madras (4[th] respondent impleaded as per order dated 21.8.2019 in Crl.M.P.Nos.11743 and 11746 of 2019 in Crl.O.P.Nos.22136 and 22137 of 2019).. Respondents in Crl.O.P.Nos.22136 and22137 of 2019 The Deputy Director of Income Tax (Investigation),Unit-3(2),Room No.120, 1[st] Floor, Investigation Wing Building,No.45, Old No.108, Uthamar Gandhi Road,Nungambakkam,Chennai-600 034... Respondent in Crl.O.P.Nos.1526 and1527 of 2020 Criminal Original Petition No.22136 of 2019 has been filed underSection 482 of Criminal Procedure Code seeking to issue adirection that the trial of the case in C.C.No.16 of 2019 beforeSpecial Court in the cadre of Sessions Judge for Trial ofCriminal cases related to Elected MPs/MLAs of Tamil Naduestablished by G.O.Ms.No.210 (Home Court II) Department dated26.04.2019 having Ref.No.II(2)/HO/2019 at Chennai is whollywithout jurisdiction and consequently direct the said SpecialCourt for Trial of Criminal cases related to Elected MPs/MLAs ofTamil Nadu at Chennai to return the case records in C.C.No.16 of2019 to the Additional Chief Metropolitan Magistrate Court, EO-II, Egmore, Chennai to continue the trial in EO CC No.267 of2018 in accordance with law and pass such further or otherorders as this Court may deem fit and proper in thecircumstances of the case and thus render justice. Criminal Original Petition No.22137 of 2019 has been filed underSection 482 of Criminal Procedure Code seeking to issue adirection that the trial of the case in C.C.No.15 of 2019 beforeSpecial Court in the cadre of Sessions Judge for Trial ofCriminal cases related to Elected MPs/MLAs of Tamil Naduestablished by G.O.Ms.No.210 (Home Court II) Department dated26.04.2019 having Ref.No.II(2)/HO/2019 at Chennai is whollywithout jurisdiction and consequently direct the said SpecialCourt for Trial of Criminal cases related to Elected MPs/MLAs ofTamil Nadu at Chennai to return the case records in C.C.No.15 of2019 to the Additional Chief Metropolitan Magistrate Court, EO-II, Egmore, Chennai to continue the trial in EO CC No.266 of 2018 in accordance with law and pass such further or otherorders as this Court may deem fit and proper in thecircumstances of the case and thus render justice. 2018 in accordance with law and pass such further or otherorders as this Court may deem fit and proper in thecircumstances of the case and thus render justice. Criminal Original Petition No.1526 of 2020 has been filed underSection 482 of Criminal Procedure Code to call for the recordsin Complaint dated 12.09.2018 filed by the respondent againstthe petitioner before the Additional Chief MetropolitanMagistrate, Egmore, Chennai in E.O.C.No.266 of 2018 andrenumbered as C.C.No.15 of 2019 and pending in the Special Courtfor trial of Criminal Cases related to MPs/MLAs of Tamil Nadu,Singaravelan Maaligai, Chennai and quash the same and pass suchfurther or other orders as this Court may deem fit and properin the circumstances of the case and thus render justice.(Prayer amended as per order in Crl.M.P.No.1565 of 2020 inCrl.O.P.No.1526 of 2020 dated 12.02.2020) Criminal Original Petition No.1527 of 2020 has been filed underSection 482 of Criminal Procedure Code to call for the recordsin Complaint dated 12.09.2018 filed by the respondent againstthe petitioners before the Additional Chief MetropolitanMagistrate, Egmore, Chennai in E.O.C.No.267 of 2018 andrenumbered as C.C.No.16 of 2019 and pending in the Special Courtfor trial of Criminal Cases related to MPs/MLAs of Tamil Nadu,Singaravelan Maaligai, Chennai and quash the same and pass suchfurther or other orders as this Court may deem fit and properin the circumstances of the case and thus render justice. (Prayer amended as per order in Crl.M.P.No.1568 of 2020 inCrl.O.P.No.1527 of 2020 dated 12.02.2020) For Petitioners: Mr.K.T.S.Tulsi, Senior Counsel Mr.Amit Desi, Senior Counsel Mr.Kunal Vajani Mr.Gopalakrishna Shenoy Mr.Kunal Mimani for Ms.C.Uma and Mr.N.R.R.Arun Natarajan in Crl.O.P.Nos.22136 & 22137/2019 and Crl.O.P.Nos.1526 & 1527/2020For Respondents: Mr.N.Baskaran and Ms.M.Sheela, Special Public Prosecutors (IT) assisted by Mr.Siddarth for R-1 in Crl.O.P.Nos.22136 & 22137/2019 Mr.N.Baskaran and Ms.M.Sheela Special Public Prosecutors (IT) assisted by Mr.Siddarth in Crl.O.P.Nos.1526 & 1527 of 2020 Mr.Harihara Arun Somasankar, Govt. Advocate (Crl.Side) for R-3 in Crl.O.P.Nos.22136 & 22137/2019 Mr.B.Vijay for R-4 in Crl.O.P.Nos.22136 & 22137/2019 COMMON ORDER This common order will dispose of these four ‘criminaloriginal petitions' (hereinafter 'Crl.O.Ps' in plural and'Crl.O.P' in singular for the sake of brevity) and all 'criminalmiscellaneous petitions' therein. 2Crl.O.P.Nos.22136 of 2019, 22137 of 2019, 1526 of 2020 and 1527 of 2020 shall be referred to as 'first Crl.O.P','second Crl.O.P', 'third Crl.O.P' and 'fourth Crl.O.P'respectively (wherever necessary and deemed appropriate) for thesake of convenience and clarity. There is no disputation ordisagreement before this Court that there is no office andobviously no incumbent with regard to second respondent in firstand second Crl.O.Ps. In other words, this court is informedwithout any disputation or disagreement that second respondentin first and second Crl.O.Ps has been wrongly described and thatin any event, presence of any alternative respondents is notnecessary. In view of this undisputed position, secondrespondent in first and second Crl.O.Ps stands deleted. 3Central theme to these four Crl.O.Ps is prayers forquashing and assailing transfer of two criminal complaintsbeing E.O.C.Nos.266 and 267 of 2018 originally on the file ofAdditional Chief Metropolitan Magistrate's Court (E.O.-II),Egmore, Chennai, subsequently transferred to Special court fortrial of criminal cases related to elected M.Ps/M.L.As of TamilNadu at Chennai, at Singaravelar Maligai, Chennai (presided overby a Sessions Judge), wherein the two criminal complaints weretaken on file as C.C.Nos.15 and 16 of 2019 respectively. {To benoted, this Court is informed that ‘E.O.’ stands for ‘EconomicOffences’ and ‘M.P/M.L.A.’ stands for Member of Parliament / 3Central theme to these four Crl.O.Ps is prayers forquashing and assailing transfer of two criminal complaintsbeing E.O.C.Nos.266 and 267 of 2018 originally on the file ofAdditional Chief Metropolitan Magistrate's Court (E.O.-II),Egmore, Chennai, subsequently transferred to Special court fortrial of criminal cases related to elected M.Ps/M.L.As of TamilNadu at Chennai, at Singaravelar Maligai, Chennai (presided overby a Sessions Judge), wherein the two criminal complaints weretaken on file as C.C.Nos.15 and 16 of 2019 respectively. {To benoted, this Court is informed that ‘E.O.’ stands for ‘EconomicOffences’ and ‘M.P/M.L.A.’ stands for Member of Parliament / Member of Legislative Assembly’ respectively}. These twocriminal complaints shall hereinafter be referred to as 'saidcriminal complaints' collectively for the sake of convenience /clarity, the same shall be referred to as ‘first criminalcomplaint’ and ‘second criminal complaint’ respectively (in theorder in which they have been set out) where it is deemednecessary / appropriate. 4As already mentioned supra, said criminal complaintsand prayers pertaining to quash / assailing transfer of same isthe central theme of instant four Crl.O.Ps. on hand. To benoted, while transfer of said criminal complaints from'Additional Chief Metropolitan Magistrate Court, E.O.-II,Egmore, Chennai' (hereinafter referred to as 'EO Court' forconvenience) to Special Court for trial of criminal casesrelated to elected M.P / M.L.As of Tamil Nadu presided over by aJudicial Officer in the cadre of District Judge (hereinafterreferred to as 'Sessions Court' and/or 'transferee court' forthe sake of convenience) and challenge to the same is thecentral theme of first and second criminal O.Ps., central themeof third and fourth Crl.O.Ps is quashing said criminalcomplaints. 5Said criminal complaints have been filed by the DeputyDirector of Income Tax (Investigation) Unit-3(2), Nungambakkam,Chennai-34 under Section 200 of 'The Code of Criminal Procedure,1973 (2 of 1974)' (hereinafter 'Cr.P.C.' for the sake ofbrevity). 6As already mentioned supra, said criminal complaints isa collective reference to aforementioned two complaints. Whilethe first criminal complaint has been laid for alleged offencesunder section 276C(1) and 277 of 'The Income Tax Act, 1961' ('ITAct' for brevity), second criminal complaint has been laid foralleged offences under sections 276C(1) and 277 read withSection 278 of IT Act. In the first criminal complaint, there isa lone accused and in the second criminal complaint, he has beenarrayed as accused along with his spouse. While first criminalcomplaint pertains to 'Assessment Year' (hereinafter 'AY' forbrevity) 2014-15, the relevant accounting year being accountingyear ending 31.03.2015, the second criminal complaint pertainsto AY 2015-16. 7All the learned senior counsel and counsel for allparties before this court made a common request that all fourCrl.O.Ps may please be heard out together. It has becomenecessary to mention this as consideration of first Crl.O.P / second Crl.O.P may become unnecessary if prayers in third andfourth Crl.O.Ps are acceded to. However, if prayers in thirdCrl.O.P / fourth Crl.O.P are not acceded to, it will thereafterbecome necessary to hear out first and second Crl.O.Ps.Therefore, this common request was acceded to, all four Crl.O.Pswere heard out together and this common order is being made. 7All the learned senior counsel and counsel for allparties before this court made a common request that all fourCrl.O.Ps may please be heard out together. It has becomenecessary to mention this as consideration of first Crl.O.P / second Crl.O.P may become unnecessary if prayers in third andfourth Crl.O.Ps are acceded to. However, if prayers in thirdCrl.O.P / fourth Crl.O.P are not acceded to, it will thereafterbecome necessary to hear out first and second Crl.O.Ps.Therefore, this common request was acceded to, all four Crl.O.Pswere heard out together and this common order is being made. 8Short facts shorn of details and particulars notimperative for appreciating this order are that the petitionersin instant four Crl.O.Ps who are assessees under the IT Act,filed their returns for the aforesaid two AYs, returns filedincluded income received by petitioners by way of sale ofimmovable properties (lands) in Muttukadu village, KancheepuramDistrict, Tamil Nadu and sale consideration received for thesame. After returns were filed by petitioners, assessment orderswere passed by 'Income Tax Department' (hereinafter 'ITDepartment' for the sake of brevity). Thereafter, IT Departmentissued notices inter-alia under section 148 of IT Act.Petitioners responded by refiling without changes, butpetitioners requested the IT Department to disclose reasons fornotices under section 148 of IT Act and this court is informedthat this was inter-alia by placing reliance on GKN Driveshaftsprinciple being the ratio laid down by Hon'ble Supreme Court inGKN Driveshafts (India) Ltd. Vs. Income Tax Officer and othersreported in (2003) 1 SCC 72. Even before reasons for issuingsection 148 notices were disclosed in accordance with GKNDriveshafts principle, petitioners received notices fromMagistrate Court for appearance in said criminal complaints.Thereafter, IT Department responded and gave reasons (inresponse to petitioners’ request for reasons based on GKNDriveshafts principle) which are to the effect that petitionersallegedly received some part of consideration in cash for saleof immovable property mentioned herein above, but did notdisclose the same. It is also the case of IT Department thatsearches were conducted in the office of a company in which oneof the petitioners is a Director, some materials (soft copies)were shared with IT Department by Enforcement Department,searches were conducted in the office of purchaser company, somesmall note books were recovered which as explained by Accountantof the purchaser company leads to the belief that petitionershave received part of consideration by cash (for sale ofaforementioned immovable property) and have not disclosed thesame in their returns. 9Be that as it may, this Court is informed that Hon'bleSupreme Court passed orders in Ashwini Kumar Upadhyay case, a'Public Interest Litigation', i.e., W.P.(C)No.699 of 2016 on01.11.2017 and thereafter gave further directions on 14.12.2017. Ashwini Kumar Upadhyay case initially led to the establishmentof a Special Court in Chennai (for entire Tamil Nadu) foroffences concerning sitting and former ‘elected members ofParliament and Legislative Assembly’ {hereinafter ‘MPs / MLAs’for brevity}. To be noted, this is vide G.O.Ms.No.1423 dated06.09.2018. 9Be that as it may, this Court is informed that Hon'bleSupreme Court passed orders in Ashwini Kumar Upadhyay case, a'Public Interest Litigation', i.e., W.P.(C)No.699 of 2016 on01.11.2017 and thereafter gave further directions on 14.12.2017. Ashwini Kumar Upadhyay case initially led to the establishmentof a Special Court in Chennai (for entire Tamil Nadu) foroffences concerning sitting and former ‘elected members ofParliament and Legislative Assembly’ {hereinafter ‘MPs / MLAs’for brevity}. To be noted, this is vide G.O.Ms.No.1423 dated06.09.2018. 10Thereafter one of the petitioners (Mr.KartiP.Chidambaram) in these four Crl.O.Ps before this Courtcontested Parliamentary elections in the general election to 17[th]Lok Sabha held in May 2019 and was elected as a Member ofParliament from Sivaganga Parliamentary Constituency. To benoted, he was declared elected on 24.05.2019 and this Court isinformed that he took oath as Member of Parliament in Lok Sabhaon 18.6.2019. In the interregnum, the Registrar General of thisCourt issued two Office Memoranda both dated 07.06.2019 (bothbearing same reference being Roc No.5745/2018/G4) followed by aletter to the Principal Judge of City Civil Court, Chennai beingletter dated 09.07.2019 and a combined reading of contents ofthese memoranda and letter suggest that they pertain to transferinter-alia of said criminal complaints from EO Court todesignated court for trying offences against M.Ps/M.L.As. Thisled to first and second Crl.O.Ps being filed in August of 2019(by petitioners) assailing such transfer inter-alia on thegrounds that transferee court does not have originaljurisdiction, that only one of the petitioners has become M.P,that he was also neither a sitting nor former M.P/M.L.A on thedate of complaint and that petitioners have been deprived of onetier of remedy by transfer from EO Court to Sessions Court. Tobe precise, first and second Crl.O.Ps were filed on 06.08.2019.After more than one recusal, these Crl.O.Ps were placed beforeme (pursuant to orders of Hon'ble Chief Justice) as SpeciallyOrdered matters on 21.01.2020. On 21.01.2020, when matters onhand were first listed before me as Specially Ordered matters,as it was after two prior Bench changes, this Court wanted toknow whether there are any objections for this Court hearing thematter and all the counsel appearing on both sides unanimouslyrequested me to take up and hear the matter. In other words,this Court took the consent of all the counsel on both sides(for hearing the matter) after making necessary disclosures andthis has been recorded separately by way of proceedings on thesame day which shall be treated as an integral part and parcelof this order. However, these proceedings (now forming part ofcase file) are not reproduced here to avoid prolixity and avertthis order becoming verbose. On 21.01.2020, when these Crl.O.Pswere thus listed before me for the first time, this court wasinformed that said criminal complaints had progressed (in thetransferee court) in the interregnum (pending first and second Crl.O.Ps) and this court was also informed that it had reachedthe stage of framing of charges. This Court was further informedthat said criminal complaints were simultaneously listed beforeSessions / transferee Court for framing charges on the same day,i.e., 21.01.2020 and therefore, as jurisdiction of SessionsCourt, i.e., transferee court itself (pursuant to transfer thatis being assailed) has been put in issue, this Court had putsaid criminal complaints on hold by way of interim orders. To benoted, this and other reasons have been articulated in theinterim order itself. Crl.O.Ps) and this court was also informed that it had reachedthe stage of framing of charges. This Court was further informedthat said criminal complaints were simultaneously listed beforeSessions / transferee Court for framing charges on the same day,i.e., 21.01.2020 and therefore, as jurisdiction of SessionsCourt, i.e., transferee court itself (pursuant to transfer thatis being assailed) has been put in issue, this Court had putsaid criminal complaints on hold by way of interim orders. To benoted, this and other reasons have been articulated in theinterim order itself. 11This court now embarks upon the exercise of discussingand giving its dispositive reasoning in third and fourth Crl.O.Ps first as whether it is necessary to examine first andsecond Crl. O.Ps will depend upon the outcome of third andfourth Crl.O.Ps. For the purpose of clarity, it is set out againthat third and fourth Crl. O.Ps seek to quash said criminalcomplaints which constitute the fulcrum of all four Crl.O.Ps nowon hand. If quash prayers are acceded to, it will not benecessary to examine the Crl. O.Ps assailing transfer of saidcriminal complaints. Axiomatically, if quash prayers arenegatived, it will become necessary to examine Crl. O.Psassailing transfer and returning a verdict on the same. 12Mr.K.T.S.Tulsi and Mr.Amit Desai, learned Seniorcounsel instructed by counsel on record for petitioners madesubmissions in third and fourth Crl.O.Ps., summation of which isfourfold and the same is as follows : (a)If Returns in response to notice underSection 148 of IT Act are treated as Returns underSection 139, then the original Returns cease to existand consequently, said criminal complaints have to bequashed; (b)Absent at least one Assessment Order, therecan be no prosecution. In the instant case, evenfirst assessment order has not been made and criminalcomplaints were launched on 12.09.2018 even beforethe reasons for issuing section 148 notices weredisclosed; (c)The entire prosecution is pivoted onstatements given by third parties qua petitioners,i.e., Managing Director and Cashier of purchasercompany and this is impermissible; (d)Complaints sought to be quashed are clearlybarred by limitation as the same have been launchedafter the cap in terms of time frame for reassessmentunder IT Act. 13Though elaborate submissions were made, theaforementioned fourfold summation sets out those arguments whichare germane and relevant to the quash prayer. 14In response to the aforesaid arguments, submissionsmade by learned Prosecutors for IT Department are twofold andthe same are as follows:(a)The entire prosecution, i.e., saidcriminal complaints which is for alleged offencesunder Sections 276C(1), 277 of IT Act and sameprovisions read with Section 278 of IT Act is notbased on assessments, but it is based on searchand seizure; (b)The said criminal complaints cannot besaid to be barred by limitation as there is nolimitation for economic offences under IT Act. 15As limitation goes to the root of the matter, as amatter of first principle, this court deems it appropriate todeal with the limitation aspect first (fourth point in summationsupra). 14In response to the aforesaid arguments, submissionsmade by learned Prosecutors for IT Department are twofold andthe same are as follows:(a)The entire prosecution, i.e., saidcriminal complaints which is for alleged offencesunder Sections 276C(1), 277 of IT Act and sameprovisions read with Section 278 of IT Act is notbased on assessments, but it is based on searchand seizure; (b)The said criminal complaints cannot besaid to be barred by limitation as there is nolimitation for economic offences under IT Act. 15As limitation goes to the root of the matter, as amatter of first principle, this court deems it appropriate todeal with the limitation aspect first (fourth point in summationsupra). 16Normally for resolving the issue of limitation,whenever it is raised in a case, a chronicle of events becomesnecessary. In this case, interestingly, the question oflimitation can be decided without even adverting to chronicle ofevents and dates. The reason is fairly simple. There is nodisputation or disagreement before this court that there is aspecial enactment which goes by the name 'The Economic Offences(Inapplicability of Limitation) Act, 1974 (Act No.12 of 1974)'{'Act No.12 of 1974' for brevity} and the Schedule to theenactment includes IT Act. As Mr.Amit Desai, learned seniorcounsel very fairly submitted that he does not enter upon anydisputation or contestation on this aspect of the matter, thecriminal complaints being complaints instituted otherwise thanon police report for alleged offences under sections 276C(1),277 of IT Act and same provisions read with section 278 of ITAct clearly do not have any limitation. Relevant provision ofAct No.12 of 1974 is section 2 read with the Schedule and thesame read as follows:Section 2 :‘2. Chapter XXXVI of the Code of Criminal Procedure,1973, not to apply to certain offencesNothing in Chapter XXXVI of the Code of CriminalProcedure, 1973 (2 of 1974) shall apply to-(i) any offence punishable under any of theenactments or provisions, if any, thereof, specifiedin the Schedule; or (ii) any other offence, which under the provisionsof that Code, may be tried along with such offence, and every offence referred to in clause (i) or inclause (ii) may be taken cognizance of by the Courthaving jurisdiction as if the provisions of thatChapter were not enacted.’ Schedule : THE SCHEDULE (See section 2) 1.The Indian Income Tax Act, 1922 (11 of 1922).[1A. Clause (a) of section 63 of the Copyright Act,1957 (14 of 1957).] 2.The Income Tax Act, 1961 (43 of 1961). [2A.The Interest-tax Act, 1974 (45 of 1974).] [2B.The Hotel-Receipts Tax Act, 1980 (54 of 1980).] [2C.The Expenditure-tax Act, 1987 (35 of 1987).] 3.The Companies (Profits) Surtax Act, 1964 (7 of1964). 4.The Wealth-Tax Act, 1957 (27 of 1957). 5.The Gift-Tax Act, 1958 (18 of 1958). 6.The Central Sales Tax Act, 1956 (74 of 1956). 7.The Central Excises and Salt Act, 1944 (1 of 1994).[7A.Chapter V of the Finance Act, 1994 (32 of 1994).]8.The Medicinal and Toilet Preparations (ExciseDuties) Act, 1955 (16 of 1955). 9.The Customs Act, 1962 (52 of 1962). 10.The Gold (Control) Act, 1968 (45 of 1968). 11.The Imports and Exports (Control) Act, 1947 (18 of1947). 12.The Foreign Exchange Regulation Act, 1947 (7 of1947). 13.The Foreign Exchange Regulation Act, 1973 (46 of1973). 14.The Capital Issues (Control) Act, 1947 (29 of1947). 15.The Indian Stamp Act, 1899 (2 of 1899). 16.The Emergency Risks (Goods) Insurance Act, 1962(62 of 1962). 17.The Emergency Risks (Factories) Insurance Act,1962 (63 of 1962). 18.The Emergency Risks (Goods) Insurance Act, 1971(50 of 1971).19.The Emergency Risks (Undertakings) Insurance Act,1971 (51 of 1971). 20.The General Insurance Business (Nationalisation)Act, 1972 (57 of 1972). [21.The Industries (Development and Regulation) Act,1951 (65 of 1951).]' (Underlining made by this Court tohighlight) 10.The Gold (Control) Act, 1968 (45 of 1968). 11.The Imports and Exports (Control) Act, 1947 (18 of1947). 12.The Foreign Exchange Regulation Act, 1947 (7 of1947). 13.The Foreign Exchange Regulation Act, 1973 (46 of1973). 14.The Capital Issues (Control) Act, 1947 (29 of1947). 15.The Indian Stamp Act, 1899 (2 of 1899). 16.The Emergency Risks (Goods) Insurance Act, 1962(62 of 1962). 17.The Emergency Risks (Factories) Insurance Act,1962 (63 of 1962). 18.The Emergency Risks (Goods) Insurance Act, 1971(50 of 1971).19.The Emergency Risks (Undertakings) Insurance Act,1971 (51 of 1971). 20.The General Insurance Business (Nationalisation)Act, 1972 (57 of 1972). [21.The Industries (Development and Regulation) Act,1951 (65 of 1951).]' (Underlining made by this Court tohighlight) 17To be noted, Sl.No.2 in the schedule is Income Tax Act,1961, i.e., IT Act and Chapter XXXVI of Cr.P.C pertains toLimitation for taking cognizance of certain offences. 18Therefore, this court comes to the conclusion (as amatter of inevitable sequitter) that said criminal complaintsare not barred by limitation. To be noted, learned Prosecutorsfor IT Department submitted that time line set out in section153 applies only to assessments and not for prosecution.However, in the light of 1974 special enactment, i.e., Act No.12of 1974, it is not necessary to delve into this aspect of thematter any further. 19This takes us to the next aspect of the matter touchingupon assessment (first and second points in summation supra).The simple and straight reply of learned Prosecutors for ITDepartment is, said criminal complaints are not based onassessment/s. The sole and simple argument of learnedProsecutors in this regard is said criminal complaints are basedon search / seizure and not on assessments. It is also pointedout that Enforcement Directorate which conducted search andseizure in a company which goes by the name 'Advantage StrategicConsulting Pvt. Ltd.' in which (this Court is informed) one ofthe petitioners is a Director, yielded some soft copies thatwere shared by Enforcement Directorate with the IT Department,which thereafter conducted independent search / seizure on5.7.2018 in the purchaser company which purchased land frompetitioners and recovered about 163 small notebooks. To benoted, the original survey was under section 133A of IT Act andfurther Enforcement Directorate shared soft copies seized fromthe aforementioned company. Search and seizure in the purchasercompany was done under section 132 of IT Act and 163 small notebooks were recovered. According to learned Prosecutors for ITDepartment, entries in the soft copies recovered by theEnforcement Directorate from the office of the aforementionedcompany (shared with IT Department) and the note books recoveredfrom the purchaser company read in juxtaposition with thestatement given by the Managing Director and Cashier of thepurchaser company, corroborate each other, establish thatpetitioners received a part of sale consideration by cash andsuppressed the same in the Returns for evasion of tax, besidesfiling false Returns. This is the crux and gravamen of statedposition of prosecution. Whether the recovered material corroborate each other and whether it establishes guilt on thepart of accused are all clearly matters for trial. Seniorcounsel for petitioners submits on instructions that ManagingDirector of purchaser company has now retracted his statement insome collateral proceedings. All these aspects of saidcomplaints are clearly matters for trial. Aforementioned oneanswer of the prosecution, i.e., answer that said criminalcomplaints are not based on assessment/s, but they are based onsearch and seizure defuses the first / second points urged onbehalf of petitioners, namely the points touching upon originalsection 139 Returns ceasing to exit and prosecution absent evenone assessment order. It is the stated position of theprosecution that both complaints are based on search / seizureand not on assessment. 20It is well settled that lead case with regard toquashment of original complaints and principles in this regardis Bhajan Lal case being State of Haryana Vs. Bhajan Lalreported in 1992 Supp (1) SCC 335, wherein seven principles(illustrative though) were laid down. The law is also wellsettled that these principles are illustrative and notexhaustive. To be noted, Bhajan Lal case law itself says so. Bethat as it may, time honoured principle that in matters seekingquashment of a criminal complaint, uncontroverted averments inthe complaint without any addition or subtraction should belooked into to examine whether an offence can be made out or not(if proved) continues to operate as the basic and fundamentaltest. In this view of the matter, a careful granular analysis ofSections 276C(1), 277 and 278 of IT Act and the ingredients ofthe same leaves this court with the considered view that it isunable to persuade itself and believe that even if all theaverments / allegations in complaints are proved to the hilt inthe trial, an offence will not be made out, though theprosecution is based on search / seizure and not on returns. Inother words, it all depends on what unfurls in the trial. 21Further, prosecution (based on search / seizure and notassessment under IT Act) being by way of criminal complaintsother than on a police report, i.e., said criminal complaints, acareful reading of two complaints, i.e., said criminalcomplaints inter-alia in the context of retraction (by purchasercompany) submission of petitioners leaves no room for doubt ordisputation that these are clearly matters for trial and noground for quash has been made out. 22To be noted, a long line of authorities starting fromP.Jayappan Vs. S.K.Perumal, First Income-Tax Officer, Tuticorinreported in 1984 (Supp) SCC 437 were read out to this Court. Owing to the stated position of the learned Prosecutors for ITDepartment that complaints are not based on assessment/s andthat they are based on search / seizure, this Court deems itappropriate to not to discuss the same in great length, as it isa case of avoidable prolixity, which if not avoided will onlymake this order needlessly verbose. 22To be noted, a long line of authorities starting fromP.Jayappan Vs. S.K.Perumal, First Income-Tax Officer, Tuticorinreported in 1984 (Supp) SCC 437 were read out to this Court. Owing to the stated position of the learned Prosecutors for ITDepartment that complaints are not based on assessment/s andthat they are based on search / seizure, this Court deems itappropriate to not to discuss the same in great length, as it isa case of avoidable prolixity, which if not avoided will onlymake this order needlessly verbose. 23This leaves us with the point regarding prosecutionbeing launched on the basis of statement of third parties (thirdpoint in summation supra). Discussion supra regarding allegedcorroboration between soft copies recovered from the company inwhich one of the petitioners is the Director (shared byEnforcement Directorate with IT Department) and small note booksin the purchaser company becomes relevant in this regard. Thethird point raised by petitioners gets neutralized by statedposition of prosecution that there is corroboration between softcopies seized from company in which one of the petitioners is aDirector and purchaser. Besides being a matter for trial, itputs to rest the ground that prosecution is based solely onstatements of third parties (purchaser company). Therefore, inthe light of the discussion supra regarding principles forquashment, facts and circumstances of this case, it cannot begainsaid by petitioners that prosecution has been launchedsolely based on the statement made by some third parties. 24The aforesaid narrative leaves this court with theconsidered view that issues that arise in said criminalcomplaints are matters for trial and no ground has been made outfor quashing the same. Therefore, in third and fourth Crl.O.Ps,I find for IT Department, hold that they are liable to bedismissed and therefore, Crl.O.P.Nos.1526 and 1527 of 2020 fail. 25As the prayers for quash qua said criminal complaintsfail, it has now become necessary to embark upon the exercise ofexamining the petitioners' challenge to transfer of two criminalcases from EO court to Sessions Court. 26Before setting out the rival submissions made in thisregard and before embarking upon the exercise of discussingrival submissions and articulating the dispostive reasoning ofthis Court, it is necessary to give an adumbration of some facts(to be noted, most of these facts have not been subjected todisputation / contestation) and the same (with dates whereverapplicable) is as follows: (a)Said criminal complaints, i.e., bothcriminal complaints were filed in the Court ofAdditional Chief Metropolitan Magistrate (E.O.II),Egmore, Chennai, i.e., EO Court on 12.09.2018. To be noted, it is urged by the petitioners that this isalso a court constituted under section 280A of IT Actand is therefore constituted under a law (statute)other than Cr.P.C as described in section 6 of Cr.P.C.To be noted, this point is in the realm of disputation/ contestation. (b)The court to which said criminal complaints,i.e., two criminal complaints have now beentransferred is a Special Court for trial of CriminalCases related to elected M.Ps/M.L.As. of Tamil Nadu,Singaravelan Maligai, Chennai. To be noted, there isno disputation or disagreement that this transfereeCourt, i.e., Sessions court is a Court of Sessionswithin the meaning of section 6(i) of Cr.P.C. There isalso no disputation or disagreement that this is not acourt constituted under any law other than Cr.P.C.within the meaning of section 6 of Cr.P.C. (c)On the date of filing of said criminalcomplaints in aforementioned EO Court, bothpetitioners were neither M.P./M.L.A. nor formerM.P./M.L.A.(d)In the case on hand, said criminalcomplaints entail maximum punishment of seven yearsand therefore, they are magisterial offences.(e)If said criminal complaints are tried byEconomic Offence court-II, i.e., EO Court in whichthey were filed and if they are disposed of by saidcourt, an appeal against conviction (if that be so)will lie to Principal Sessions Judge, City CivilCourt, Chennai under section 374(3) of Cr.P.C. Ifoffences are tried by the transferee court, i.e.,Special Court for trial of Criminal Cases related toelected M.Ps/M.L.As. of Tamil Nadu and if it isdisposed of by that court, an appeal will lie to thiscourt (High Court) under section 374(2) of Cr.P.C.(f)In the light of the aforesaid two points,post disposal of appeal by Principal Judge, City CivilCourt, Chennai, a revision will lie to this courtunder section 397 Cr.P.C., but that will obviously notbe available if said criminal complaints are tried anddisposed of by transferee court and an appeal isdecided by this court in an appeal under section 374(2). In other words, to put it differently, if saidcriminal complaints are tried by Economic offencesCourt, i.e., EO court, then parties can prefer arevision under section 397 of Cr.P.C to this courtpost appeal, but the same will be unavailable if it istried and disposed of by transferee court, i.e., Sessions court. (g)While EO court has original jurisdiction,transferee court which is a Sessions court (within themeaning of section 6(i) of Cr.P.C.) does not haveoriginal jurisdiction. The Sessions court which doesnot have original jurisdiction cannot directly takecognizance of an offence unless there is committal. (h)Vide G.O.Ms.No.1293 dated 24.05.1982, thirdrespondent Government of Tamil Nadu constituted twoAdditional Metropolitan Magistrate courts in the cityof Chennai for speedy trial of economic offences inthe State of Tamil Nadu. To be noted, EO Court we areconcerned with is one of these two courts. (To benoted, G.O. denotes Government Order). Sessions court. (g)While EO court has original jurisdiction,transferee court which is a Sessions court (within themeaning of section 6(i) of Cr.P.C.) does not haveoriginal jurisdiction. The Sessions court which doesnot have original jurisdiction cannot directly takecognizance of an offence unless there is committal. (h)Vide G.O.Ms.No.1293 dated 24.05.1982, thirdrespondent Government of Tamil Nadu constituted twoAdditional Metropolitan Magistrate courts in the cityof Chennai for speedy trial of economic offences inthe State of Tamil Nadu. To be noted, EO Court we areconcerned with is one of these two courts. (To benoted, G.O. denotes Government Order). (i)Pursuant to directions given by Hon'bleSupreme Court in Ashwini Kumar Upadhyay case,G.O.Ms.No.1423 was made on 6.9.2018 constituting aSpecial Court at Chennai (for entire State of TamilNadu) to try criminal cases involving elected Membersof Parliament and Members of Legislative Assembly ofTamil Nadu, followed by G.O.Ms.No.1568 dated17.9.2018, whereby amendment notification has beenissued to the effect that 'a Special Court in thecadre of Sessions Judge at Chennai' will standsubstituted in place of the expression 'a SpecialCourt at Chennai'. This was further followed by asmany as five G.Os, namely G.O.Ms.No.209 toG.O.Ms.No.213, all dated 26.04.2019. Net / combinedeffect of these five G.Os is, Special Courts to trycases involving M.P/M.L.As throughout Tamil Nadu(every Judicial District / Sessions Division) werecreated at both Sessions and Magisterial levels. InChennai, such Courts became four in number and theyare, two Special Courts in Sessions Cadre, one inAssistant Sessions Cadre and one Magistrate Court (Tobe noted, this Magistrate Court is II MetropolitanMagistrate Court, Egmore, Chennai) falling undersection 6(ii) of Cr.P.C. To be noted, while it isMetropolitan Magistrate in Chennai, it is JudicialMagistrate in other Divisions / judicial Districts.(j)This Court is informed that after as many as14 hearings in the EO court between 19.9.2018 and8.7.2019, said criminal complaints were transferred totransferee court. With regard to the date of transferas mentioned elsewhere (supra in this order), acombined reading of two memoranda of fourth respondent(both dated 07.06.2019 and both bearing same referencebeing Roc No.5745/2018/G4) and a letter from fourth respondent to Principal Judge of City Civil Court,Chennai suggest that they pertain inter-alia totransfer of said criminal complaints to designatedcourt for trying offences against M.Ps/M.L.As., but itdoes not give the date of transfer with exactitude andspecificity. This was put to learned counsel for 4[th]respondent. Learned counsel for 4[th] respondent aftertaking instructions, adverted to communications dated10.7.2019 in Dis.No.174/2019 and Dis.No.173/2019 fromthe Additional Chief Metropolitan Magistrate (E.O.II),Egmore, Chennai inter-alia to petitioners andsubmitted that the actual date of transfer is10.7.2019. Therefore, from hereon, this order willproceed on the basis that the date of transfer of saidcriminal complaints from EO Court to transferee courtis 10.7.2019. (k)After transferring said criminal complaintswhich form subject matter of the cases on hand,Registrar General of this Court (fourth respondent infirst and second Crl.O.Ps) vide proceedings dated6.9.2019 bearing Roc No.5745/2018/G4 wrote toGovernment of Tamil Nadu, in other words, fourthrespondent wrote to third respondent for nondesignating II Metropolitan Magistrate Court citingworkload.(l)Pursuant to aforesaid 06.09.2019 proceedingsof fourth respondent, Government issued G.O.Ms.No.535,dated 11.10.2019 non designating II MetropolitanMagistrate Court. (k)After transferring said criminal complaintswhich form subject matter of the cases on hand,Registrar General of this Court (fourth respondent infirst and second Crl.O.Ps) vide proceedings dated6.9.2019 bearing Roc No.5745/2018/G4 wrote toGovernment of Tamil Nadu, in other words, fourthrespondent wrote to third respondent for nondesignating II Metropolitan Magistrate Court citingworkload.(l)Pursuant to aforesaid 06.09.2019 proceedingsof fourth respondent, Government issued G.O.Ms.No.535,dated 11.10.2019 non designating II MetropolitanMagistrate Court. 27Having set out some of the most essential (mostlyundisputed) facts regarding transfer of said criminal complaintsfrom EO Court to Sessions Court, before proceeding further,i.e., before setting out rival submissions, embarking upon theexercise of examining the same and giving dispositive reasoning,this court deems it appropriate to give an adumbration ofvarious provisions of law which are relevant to the discussionsand dispositive reasoning to follow. Though referred to as anadumbration, this court deems it appropriate (for the sake ofconvenience, clarity and specificity) to set out the same as anarrative with short discussions wherever imperative andadumbration rolled into one, which is as follows: (a)Chapters XXI and XXII of IT Act captioned‘Penalty Imposable’ and ‘Offences and Prosecutions’respectively containing sections 270 to 275 (Chapter XXI)and sections 275A to 280D (Chapter XXII) are of relevance.To be noted, said criminal complaints, as already alludedto supra, are under sections 276C(1), 277 of IT Act and said provisions read with 278 of IT Act. Therefore, thethree main provisions of law qua said criminal complaintsare contained in Chapter XXII of IT Act.(b)Section 279A of IT Act captioned ‘Certainoffences to be non-cognizable’ reads as follows :‘279A. Certain offences to be non-cognizable.—Notwithstanding anything contained in theCode of Criminal Procedure, 1973 (2 of 1974),an offence punishable under section 276B orsection 276C or section 276CC or section 277or section 278 shall be deemed to be non-cognizable within the meaning of that Code.’ (c)A perusal of Section 279A of IT Act makes itclear that all the three provisions of IT Act which havebeen invoked qua said criminal complaints are deemed to benon cognizable offences and there is a non obstante clausequa Cr.P.C., i.e., that it is notwithstanding anythingcontained in Cr.P.C.(d)Section 292 of IT Act captioned ‘Cognizance ofoffences’ (to be noted, this is outside of Chapters XXIand XXII referred to supra) refers to offences under ITAct in general which reads as follows: ‘292. Cognizance of offences.—No court inferior tothat of a presidency magistrate or a magistrate ofthe first class shall try any offence under thisAct.’(e)A perusal of section 292 of IT Act makes itclear that all offences under IT Act including allegedoffences under three provisions of law qua said criminalcomplaints shall not be tried by a court inferior to thatof a Presidency Magistrate / Magistrate of the First ClassCourt which can now be read as Magistrate, as this courtis informed without any disputation that the distinctionbetween Magistrates of First and Second Classes have sincebeen done away with. (f)‘Court of Session’ is defined, described andexplained including jurisdiction in section 9 of Cr.P.C.Likewise, ‘Courts of Metropolitan Magistrates’ is defined,described and explained including jurisdiction in section16 of Cr.P.C. Sections 9 and 16 of Cr.P.C read as follows:‘9. Court of Session.—(1)The State Governmentshall establish a Court of Session for everysessions division. (2)Every Court of Session shall be presidedover by a Judge, to be appointed by the High C