Wp/464/2021 Of Reliance Industries Limited v. Chief Commissioner Of Income Tax-2 And Anr

Digitallysigned by1/32MEERAMEERAMAHESHMAHESHJADHAVJADHAVDate:2021.12.23IN THE HIGH COURT OF JUDICATURE AT BOMBAY13:44:04+0530ORDINARY ORIGINAL CIVIL JURISDICTIONWRIT PETITION NO.464 OF 2021 ---- Mr. Vikram Nankani, Senior Advocate a/w Mr. P. C. Tripathi, Mr. AmitMathur, Mr. Dhruv Nyayadhish and Mr. Mehul Talera i/b Mr. Raj Darak forPetitioner Mr. Anil C Singh, Additonal Solicitor General a/w Mr. Suresh Kumar, Mr.Aditya Thakkar, Ms Smita Thakur, Mr. Pranav Thackur, Ms MohineeChougule and Mr. Arjun Gupta for Respondents ---- CORAM : K.R. SHRIRAM &AMIT B BORKAR, JJ. RESERVED ON: 30[th] NOVEMBER , 2021 PRONOUNCED ON: 23[rd] DECEMBER 2021 JUDGMENT (PER K. R. SHRIRAM J.) : 1Rule. Rule made returnable forthwith and heard and disposed at the admission stage itself with the consent of the parties. Heard, Shri Nankani, Shri Anil Singh and considered the pleadingsand written submissions. 2Petitioner originally filed the petition challenging the communicationdated 25[th] January 2021 withdrawing the earlier communication dated 21[st]October 2020 issued by the office of Chief Commissioner of Income Tax,Mumbai. By this communication dated 21[st] October 2020, petitioner wasinformed that they are eligible for resolution of tax disputes under theprovisions of the Direct Tax Vivad Se Vishwas Act 2020 (DTVSV Act).According to petitioner, relying on this communication petitioner had filedseveral applications for resolution of tax disputes. It is petitioner’s case thatthe stand of respondents is contrary to the plain language of Section 9(c) ofthe DTVSV Act. 3Petitioner is desirous of availing the benefit of DTVSV Act with respectto certain pending income tax litigations before various appellate levels. Byan application dated 15[th] April 2020, petitioner sought clarification from therevenue with respect to its eligibility under the DTVSV Act. A doubtregarding petitioner’s eligibility occurred in the mind of petitioner becauseof the following two proceedings:- (A) FIR No.17/2014 dated 11[th] February 2014 under Section“Section 13(1)(c) and (d) of Prevention of Corruption Act (PCA)and 420/120 B of the Indian Penal Code (IPC) registered by AntiCorruption Bureau of the National Capital Territory of Delhi dated14[th] February 2014 where no charge sheet has been filed. TheAccused persons include petitioner. (hereinafter referred to as thefirst proceeding) (B) Special CBI Case No.91 of 2011 pending before Special Judgefor Greater Mumbai wherein the Ld. Special Judge has takencognizance for “offences punishable under Section 120B r/w 420of IPC and u/s 13(2) r/w 13(1)(d) of PC Act against the accusedin the matter. The Accused named in the chargesheet includepetitioner. (hereinafter referred to as the second proceeding) 4Respondent no.1, by letter dated 21[st] October 2020, replied topetitioner’s application dated 15[th] April 2020 that petitioner was eligible /entitled to avail the benefit of DTVSV Act in accordance with law.Following the said communication, petitioner filed 27 applications forresolution of disputes under the DTVSV Act as mentioned in paragraph4(M) of the Petition. In the petition that was lodged on 29[th] January 2021 itis also stated that petitioner was proposing to file further applications beforethe last date of filing of the application, i.e., 31[st] January 2021 andpetitioner was ready and willing to pay the amounts as per the orderspassed under the DTVSV Act. Thereafter, petitioner received a letter dated 25[th] January 2021 fromrespondent no.1, whereby respondent no.1 conveyed to petitioner that inview of the provisions of Section 9(c) of the DTVSV Act, since theprosecution was instituted against petitioner under the Prevention ofCorruption Act 1988 (PC Act), the letter dated 21[st] October 2020 issued topetitioner was contrary to the said provisions and withdrew the letter dated21[st] October 2020. Thereafter, petitioner received a letter dated 25[th] January 2021 fromrespondent no.1, whereby respondent no.1 conveyed to petitioner that inview of the provisions of Section 9(c) of the DTVSV Act, since theprosecution was instituted against petitioner under the Prevention ofCorruption Act 1988 (PC Act), the letter dated 21[st] October 2020 issued topetitioner was contrary to the said provisions and withdrew the letter dated21[st] October 2020. 5Aggrieved by the said withdrawal, petitioner filed this petitionimpugning the letter dated 25[th] January 2021. Subsequently petitioner has,upon leave being granted amended the petition when petitioner’s 27applications / declarations filed under the DTVSV Act were rejected.Petitioner has also impugned the rejection of petitioner’s applications underthe DTVSV Act and has also sought declaration to hold and declare thatpetitioner is not rendered ineligible under the DTVSV Act on the groundstated in the letter dated 25[th] January 2021, i.e., prosecution was institutedagainst petitioner under PC Act. 6Admittedly, the first and second proceedings are the hurdles forpetitioner. These two proceedings are still pending. In any event, they werepending on the date the declaration was filed by petitioner under the DTVSVAct. Section 9(c) of the DTVSV Act reads as under: “9. The provisions of this Act shall not apply :- (a)……………… (b)……………… (c) to any person in respect of whom prosecution for any offencepunishable under the provisions of the Unlawful Activities(Prevention) Act 1967, the Narcotic Drugs and PsychotropicSubstances Act 1985, the Prevention of Corruption Act, 1988, thePrevention of Money Laundering Act 2002, the Prohibition of BenamiProperty Transactions Act 1988 has been instituted on or before thefiling of the declaration or such person has been convicted of any suchoffence punishable under any of those Acts. (d)……………….. (e)…………………” (emphasis supplied) SUBMISSIONS OF SHRI NANKANI:- 7RE: Whether “in respect of petitioner” any prosecution has been“instituted” on or before the filing of “the declaration”: (a)The word “instituted” in regard to prosecution in either of the abovetwo proceedings is not defined under the DTVSV Act. (b)The Hon’ble Supreme Court in Jamuna Singhvs. Bhadai Shah[1],inrelation to institution of a case for prosecution, had deliberated on andexplained as to when a case is said to be “instituted”. The Hon’ble SupremeCourt observed that the Code does not contain any definition of the words“institution of a case”. It is clear that a case can be said to be instituted in aCourt only when the Court takes cognizance of the offence alleged therein.An examination of the provisions makes it clear that when a Magistratetakes cognizance of an offence upon receiving a complaint of facts whichconstitute such offence, a case is instituted in the Magistrate's Court andsuch a case is one instituted on a complaint. Again, when a Magistrate takescognizance of any offence upon a report in writing of such facts made byany police officer it is a case instituted in the Magistrate's Court on a policereport. (c)Jamuna Singh (supra) was followed by the Hon’ble Supreme Court inRamesh Kumar Soni v. State of Madhya Pradesh[2] where the court held theCode of Criminal Procedure does not, however, provide any definition of“institution of a case”. It is, however, trite that a case must be deemed to be 1 AIR 1964 SC 1541 2 (2013) 14 SCC 696 (c)Jamuna Singh (supra) was followed by the Hon’ble Supreme Court inRamesh Kumar Soni v. State of Madhya Pradesh[2] where the court held theCode of Criminal Procedure does not, however, provide any definition of“institution of a case”. It is, however, trite that a case must be deemed to be 1 AIR 1964 SC 1541 2 (2013) 14 SCC 696 instituted only when the court competent to take cognizance of the offencealleged therein does so. The cognizance can, in turn, be taken by theMagistrate on a complaint of facts filed before him which constitute such anoffence. It may also be taken if a police report is filed before the Magistratein writing of such facts as would constitute an offence. The Magistrate mayalso take cognizance of an offence only the basis of his knowledge orsuspicion upon receipt of the information form any person other than apolice officer. In the case of the Sessions Court, such cognizance is taken oncommitment to it by a Magistrate duly empowered in that behalf. All thisimplies that the case is instituted in the Magistrate’s Court when theMagistrate takes cognizance of an offence, in which event the case is oneinstituted on a complaint or police report. The decision of this Court inJamuna Singh (supra) clearly explains the legal position in this regard. (d)The judgment in Jamuna Singh (supra) was in the context of“institution” of prosecution for offences punishable under 393 and 323 ofIPC case, for which Code of Criminal Procedure (CrPC) being applicable inview of Section 4 of CrPC, the provisions of CrPC were analysed for thecorrect meaning and scope of the word “institution”. Even though theDTVSV Act does not per se make any offence punishable so as to applySection 4(2) of CrPC, however, all the five Acts specified under Section 9(c)of DTVSV Act are also Special Acts, wherein, in view of section 4(2) of CrPC,investigation and trial shall be, subject to provisions of those Special Acts asper provisions of CrPC. Therefore, same meaning of the word “institution” will have to be given even for the purpose of Section 9(c) of the DTVSV Act.(e)The term “institution” in the context of any prosecution for specifiedoffences is not defined in the DTVSV Act as well as CrPC. It is a term of art,which has to be understood in the context it is used. There is no room fordictionary or common parlance meaning. In the context of institution of acase for prosecuting for offences, the court has explained the scope andcontextual meaning of the term “institution”. (f)The judgment relied by respondents in State,CBI Vs. SashiBalasubramanian & Anr[3] does not consider the earlier decision in JamunaSingh (supra), which has also been followed later in Ramesh Kumar Soni(supra). Notwithstanding the above, even otherwise the case of SashiBalasubramanian (supra)is clearly distinguishable and was in peculiar factsof that case inasmuch as: (i) Petitioner therein was a public servant charged under the PC Act and seeking immunity under Kar VivadSamadhan Scheme, 1998 (KVSS), who had neither filedany declaration, nor paying any disputed Tax Arrears,under the said Scheme. (ii) The declarants therein (non-public servants), who fileddeclaration dated 31[st] December1998 and paid Tax Arrearsunder the said KVSS, were in fact granted immunity under the Scheme, despite being co-accused in the said FIR qua them alleging offences under Sections 120-B, 420 and 471of the Penal Code, Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988 and Section136 of the Customs Act, 1962. (iii) The question framed was not for interpreting the word “institution” of prosecution qua the case of the non-publicservant declarants, who were accused in the FIR. (iv) Having held that the KVSS was not meant for publicservants, the Hon’ble Supreme Court itself refrained fromdelving deep in the issues. (ii) The declarants therein (non-public servants), who fileddeclaration dated 31[st] December1998 and paid Tax Arrearsunder the said KVSS, were in fact granted immunity under the Scheme, despite being co-accused in the said FIR qua them alleging offences under Sections 120-B, 420 and 471of the Penal Code, Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988 and Section136 of the Customs Act, 1962. (iii) The question framed was not for interpreting the word “institution” of prosecution qua the case of the non-publicservant declarants, who were accused in the FIR. (iv) Having held that the KVSS was not meant for publicservants, the Hon’ble Supreme Court itself refrained fromdelving deep in the issues. (g)In the first proceeding, FIR is registered but Charge Sheet has notbeen filed in Court, and no cognizance has been taken by the Court. Thus,by applying the contextual meaning given to the term “institution” by theHon’ble Supreme Court in Jamuna Singh (supra), in respect of petitioner noprosecution has been “instituted” on or before the filing of “the declaration”. (h)However, in the Case pending before the Special Judge for CBI cases,Charge Sheet has been filed in Court, and cognizance of offences has beentaken by the Court. Thus, by applying the contextual meaning given to theterm “institution” the Hon’ble Supreme Court in Jamuna Singh (supra), inrespect of petitioner, prosecution has been “instituted” on or before the filingof “the declaration”. 8RE: Whether such prosecution is instituted qua petitioner for any“offence punishable under the provisions of” any of the following fivespecified Acts: (a)The first proceedings, i.e., FIR No. 17 of 2014 dated 11.02.2021registered by Anti Corruption Bureau, Delhi, against petitioner and others isfor investigating alleged offences punishable under Section 120B r/w 420 ofIPC and Section 13(2) r/w 13(1)(c) & (d) of PC Act, 1988. The second proceedings, i.e., Special CBI Case No. 91 of 2011pending before the Special Judge, Mumbai, against petitioner and others, isfor prosecution for alleged offences punishable under Section 120B r/w 420of IPC and Section 13(2) r/w 13(1)(d) of PC Act, 1988. Although the Bill proposed inclusion of IPC offences in offencesspecified in Section 9(c), the DTVSV Act specifically excluded IPC in the saidSection. Therefore, Section 120B r/w 420 of IPC would have no bearing onthe issue. Section 13 of PC Act, 1988 applies exclusively qua a PublicServant. It is not the case of respondent that petitioner Company is a PublicServant. The Hon’ble Supreme Court in State through CBI v. Jitendra KumarSingh[4] held that:- “26.3.Section 13 deals with the criminal misconduct by a publicservant, which is exclusively an offence against the public servantrelating to criminal misconduct. …...” (b)As per the plain reading of Section 13 of PC Act, 1988 as also the 4 (2014) 11 SCC724 Although the Bill proposed inclusion of IPC offences in offencesspecified in Section 9(c), the DTVSV Act specifically excluded IPC in the saidSection. Therefore, Section 120B r/w 420 of IPC would have no bearing onthe issue. Section 13 of PC Act, 1988 applies exclusively qua a PublicServant. It is not the case of respondent that petitioner Company is a PublicServant. The Hon’ble Supreme Court in State through CBI v. Jitendra KumarSingh[4] held that:- “26.3.Section 13 deals with the criminal misconduct by a publicservant, which is exclusively an offence against the public servantrelating to criminal misconduct. …...” (b)As per the plain reading of Section 13 of PC Act, 1988 as also the 4 (2014) 11 SCC724 aforesaid judgment of Hon’ble Supreme Court in Jitendra Singh (supra),petitioner being a “non public servant”, even if petitioner fails in the 1[st]proposition, and even if it is presumed for the sake of arguments that theallegations in both the cases would result in the trial and conviction ofpetitioner, neither the prosecution can be said to have been instituted fortrying petitioner (a non public servant) for “offence punishable under theprovisions of” Section 13 of PC Act, nor can he be convicted thereunder. (c)It is trite law that Cognizance is of offences, and not of the offender /accused. The offences alleged under IPC are distinct and separate, and areadmittedly excluded under Section 9(c) of the DTVSV Act. Therefore, thecontention of respondents, with support of various decisions reported in P.Nallamal v. State,[5]U. Santosh Kumar v. State[6], State v. D.J. PrabhakarAnand[7]and Rajendra Kumar Jain v. State[8]that even a non public servantcan be tried by a Special Judge for PC Act cases with aid of provisions of IPCsuch as Section 107, 109 or 120B, for abetting or conspiracy for an offenceby public Servant under Section 13 of PC Act, is wholly irrelevant. WhichCourt can try an offence is wholly irrelevant for the issue in hand. Neitherany of the said judgments relied upon by respondents depart from JitendraKumar Singh (supra),nor do they hold that prosecution can be instituted fortrying a non public servant for an “offence punishable under the provisionsof” Section 13 of PC Act. Hence, it is clear that no prosecution is instituted 5 (1999) 6 SCC 559 6 2001 SCC Online AP 1570 7 2005(3) A.P.L.J. 293(HC) 8 (2016) 3 Gauhati Law Reports 309 against petitioner for an “offence punishable under the provisions of” PCAct. (d)Respondents further relied upon a judgment of this Hon’ble Court inAmit Hemendra Jhaveri v. Union of India[9] to contend that the intentionDTVSV Act is to exclude persons against whom prosecution is instituted forsocio-economic offences, and that the DTVSV Act is not meant forlegitimising proceeds of crime by payment of tax thereon. The observationin the said judgment were while considering challenge to the validity of theprovisions of KVSS on the grounds of discrimination and manifestarbitrariness. Unlike the DTVSV Act, KVSS had excluded benefits thereunderagainst a person against whom prosecution was instituted even under IPC.By the said submission an attempt is made by respondents to again read theprovisions of IPC into Section 9(c) of the DTVSV Act, though specificallyexcluded. Neither such attempt to supply “casus omissus” can sustain in theeyes of law, nor would the same be in accordance with the legislative intentin excluding IPC offences from Section 9(c), once it is established that noprosecution is instituted against petitioner for any offence punishable underthe provisions of any of the specified Acts. IPC has been consciously omittedin Section 9(c) of the DTVSV Act. The legislative intent in not including IPCcannot be nullified by invoking provisions of abetment and conspiracy fromIPC. This was purely within the domain of the Parliament. The offencespunishable under the provisions of the DTVSV Act specified in Section 9(c) 9 (2015) 64 Taxmann.com 28 (Bom) 9 (2015) 64 Taxmann.com 28 (Bom) shall be applicable qua the declarant to cover him under the provision.There cannot be any departure from this basic requirement. 9SUBMISSIONS OF SHRI ANIL SINGH, ASG (a)The present writ petition is misconceived and baseless. The DTVSVAct shall not apply to petitioner. (b)As held by the Apex Court in Sashi Balsubramanian (supra) courtneed not even take cognizance where institution of FIR has resulted ininitiation of investigation to say prosecution has been instituted. Jamuna Singh (supra) relied upon by petitioner was not at allapplicable because that was considering the proceedings under the IPC readwith CrPC, whereas in Sashi Balsubramanian (supra) Apex Court wasconsidering the provisions of Section 95 clause (iii) of KVSS. The provisionsof the scheme as well as the wording in clause (iii) of Section 95 of KVSSwere almost identical to the words used in Sub Section (c) of Section 9 ofDTVSV Act, only exception being that Chapter IX or Chapter XVII of theIndian Penal Code 1860 and the Foreign Exchange Regulation Act 1973,which were included in KVSS has been retained in the DTVSV Act, with atweak, i.e, IPC has been included in Sub Section (d) of Section 9 restrictingit to prosecution which has been initiated by the Income Tax Authority foroffence punishable under the IPC or for enforcement of civil liability andSub Section (b) of Section 9 has taken care of FERA to cover any person inrespect of whom an order of detention has been made under the provisionsof Foreign Exchange and Prevention of Smuggling Activities 1974. (c)Prosecution has been instituted would not mean the charge sheet hasbeen filed or cognizance has been taken but it should be given its ordinarymeaning because if that is what has to be read in Sub Section (c) of Section9 of the DTVSV Act, the Act would have stated so. The words used are“prosecution has been instituted” and it should be given its ordinarymeaning. The provisions of the DTVSV Act was not to apply to thosepersons against whom prosecution has been instituted under the PC Actand/or those who have income/property acquired by illicit means. Thebenefit of the DTVSV Act was only for those whose income/ property areacquired through legal permissible process but not disclosed. The DTVSVAct provides for immunity from penalty and prosecution to those who makea valid declaration thereunder. The parliament in its wisdom did not wantto extend the benefit of the DTVSV Act to those persons whose hands weretainted, who had acquired income / property by illicit means and those whoare accused of / charged with having conspired to commit acts ofcorruptions which are punishable under the PC Act. Parliament wanted tokeep out such money offered to tax on which there is a shadow of illegality.The differential classification made has a nexus to the objective of the Actwhich was extended by way of benefit to all assessees who have disputeswith the Revenue pending before the authority under the DTVSV Act or inthe High Court or the Supreme Court. This benefit, however, under theDTVSV Act was not available to a person against whom proceedings havebeen instituted under the IPC, PC Act, Narcotic Drugs and Psychotropic Substances Act, 1985 etc. The class of persons who have been left out ofthe benefit are those against whom proceedings/prosecution have beeninitiated for various social-economic crimes as listed out therein. Theobjective of the DTVSV Act is to provide a mutual benefit,i.e., not only tocollect revenue which is locked in litigation which will augment the State’sresources but also benefit the tax payer who on settling the disputes paystax only at 30% of the declared income along with immunity from penaltyand prosecution. Substances Act, 1985 etc. The class of persons who have been left out ofthe benefit are those against whom proceedings/prosecution have beeninitiated for various social-economic crimes as listed out therein. Theobjective of the DTVSV Act is to provide a mutual benefit,i.e., not only tocollect revenue which is locked in litigation which will augment the State’sresources but also benefit the tax payer who on settling the disputes paystax only at 30% of the declared income along with immunity from penaltyand prosecution. (d)Submissions of Shri Nankani that the prosecution instituted should befor an offence punishable under the PC Act and as petitioner cannot bepunished under Section 13 of the PC Act, Sub Section (c) of Section 9 of theDTVSV Act is not applicable to petitioner is a nonstarter. It is because firstof all the two proceedings referred to in the petition are those exclusivelytriable only by the court of Special Judge having jurisdiction in the matter.The Apex Court in P. Nallammal (supra) has held that even if in the twoproceedings the prosecution against public servants abate for whateverreasons, still it is only the court of Special Judge having jurisdiction in thematter who can try the matter. P. Nallammal (supra) shows how an offenceunder Section 13(1)(e) of the PC Act can be abetted by non-public servantsand the only mode of prosecuting such offender is through the trialenvisaged in the PC Act. These submissions find support in a judgment of the High Court ofAndhra Pradesh at Hyderabad in U. Santosh Kumar (supra) and another judgment of the same court in D. J. Prabhakar Anand (supra) and RajendraKumar Jain (supra).These judgments show that under Section 120B of theIPC, whoever is a party to a criminal conspiracy to commit an offencepunishable with death, imprisonment for life or rigorous imprisonment oftwo years or upwards under Section 13 of the PC Act it is not less than 4years but may extend to 10 years and shall also be liable to fine, shall,where no express provision is made in this Code for the punishment of sucha conspiracy, be punished in the same manner as if he had abetted suchoffence. Even under Section 120B of the IPC, petitioner would be an abettor ofthe offence under the PC Act and, therefore, cannot at this stage come upwith the argument that petitioner cannot be punished under the provisionsof the PC Act. The tax authority who is considering the declaration under the DTVSVAct cannot be expected to go into the details of each offence and admittedlythere are two proceedings against petitioner for offence punishable underthe PC Act read with IPC and petitioner is certainly one of those to whomthe provisions of the DTVSV Act would not apply. (e)The charge sheet in the second proceeding, copy whereof has beenfiled by petitioner, makes serious allegations against petitioner wherepetitioner is accused of causing wrongful loss of Rs.147.41 crores toNational Insurance Co. Ltd. and corresponding wrongful gain to petitioner.Conspiracy under Section 120B of IPC cannot be segregated from Section The tax authority who is considering the declaration under the DTVSVAct cannot be expected to go into the details of each offence and admittedlythere are two proceedings against petitioner for offence punishable underthe PC Act read with IPC and petitioner is certainly one of those to whomthe provisions of the DTVSV Act would not apply. (e)The charge sheet in the second proceeding, copy whereof has beenfiled by petitioner, makes serious allegations against petitioner wherepetitioner is accused of causing wrongful loss of Rs.147.41 crores toNational Insurance Co. Ltd. and corresponding wrongful gain to petitioner.Conspiracy under Section 120B of IPC cannot be segregated from Section 13(1)(d) and the offence under the PC Act could not have happened but forconspiracy by petitioner. Trial is one, evidence will be common and theSpecial Court will decide the matter. The role of Income Tax Department islimited to scrutinizing the application/declaration to see the applicant’seligibility and if any person falls under the provisions of Section 9, theapplication will be rejected. As there is prosecution instituted againstpetitioner for offence punishable under the PC Act, Income Tax Departmenthas rightly rejected. Petitioner is accused of criminal wrongful loss ofRs.147.41 crores to National Insurance Co. Ltd. and corresponding wrongfulgain to itself and if the court grants petitioner the relief prayed for in thepetition, it would amount to extending the beneficial provisions of DTVSVAct to a person against whom prosecution have been instituted for social-economic crime and that will be against the objective of DTVSV Act. DISCUSSION AND CONCLUSIONS:- 10The petition seeks the following final reliefs:- “a) that this Hon'ble Court be pleased to issue a Writ of Certiorari orany other writ order or direction under Article 226 of the Constitutionof India calling for the records of the case leading to the issue of theimpugned letter (Exhibit H) dated 25th January, 2021 and after goingthrough the same and examining the question of legality thereofquash, cancel and set aside the impugned letter (Exhibit H) dated25th January, 2021; b) that this Hon'ble Court may be pleased to issue a Writ ofMandamus or a Writ in the nature of Mandamus, or any otherappropriate Writ, Order or Direction under Article 226 of theConstitution of India, ordering and directing the Respondents towithdraw the impugned letter (Exhibit H) dated 25th January, 2021; bb) that this Hon'ble Court may be pleased to hold and declare thatpetitioner is not rendered ineligible under the Vivad Se Vishwas Act,2020 on the ground stated in the impugned letter dated 25[th] January,2021 or any other. ground; cc) that this Hon'ble Court may be pleased to issue an appropriatewrit, order or direction under Article 226 of the Constitution of Indiato quash and set aside the summary ex-parte rejection of the variousapplications filed by petitioner under the Vivad Se Vishwas Act, 2020(shown as rejected in Exhibit-I), and to direct the Respondents togrant consequential reliefs under The DTVSV Act to secure the ends ofjustice;” 11It is the case of petitioner that it is entitled to these reliefs on the basis that petitioner is not covered by Section 9(c) of the DTVSV Act because outof the two criminal cases pending against petitioner, in the first proceedingthe prosecution has not been instituted as yet since only FIR has beenregistered and the matter has not proceeded further. In the secondproceeding where chargesheet is filed and cognisance is taken, even ifconvicted, petitioner would be convicted for offences under the Indian PenalCode, 1860 and not for offences punishable under the Prevention ofCorruption Act, 1988. 12The present Writ Petition, in our view, is misconceived and baseless.Petitioners are not eligible for the benefits available under the DTVSV Act.The DTVSV Act cannot apply to petitioner in view of provisions of Section9(c) of the Act. that petitioner is not covered by Section 9(c) of the DTVSV Act because outof the two criminal cases pending against petitioner, in the first proceedingthe prosecution has not been instituted as yet since only FIR has beenregistered and the matter has not proceeded further. In the secondproceeding where chargesheet is filed and cognisance is taken, even ifconvicted, petitioner would be convicted for offences under the Indian PenalCode, 1860 and not for offences punishable under the Prevention ofCorruption Act, 1988. 12The present Writ Petition, in our view, is misconceived and baseless.Petitioners are not eligible for the benefits available under the DTVSV Act.The DTVSV Act cannot apply to petitioner in view of provisions of Section9(c) of the Act. 13Before addressing the two contentions raised by petitioner, it may benoted that the purpose and object of DTVSV Act is that the DTVSV Act hasbeen formulated for resolution of disputed tax and for matters connectedtherewith or incidental thereto. The DTVSV Act allows the eligible assesseesto settle pending disputes on payment of the specified amount based on thepercentage of the disputed tax. The objective of the DTVSV Act is to inter alia reduce pending income tax litigation, generate timely revenue for theGovernment and benefit taxpayers by providing them peace of mind,certainty and savings on account of time and resources that would otherwisebe spent on the long-drawn and vexatious litigation process. 14The DTVSV Act is a beneficial legislation enacted with a definitepurpose for the benefit of both the Assessee and the Department wherebythe Legislature has provided a mechanism under which pending income taxlitigation is sought to be reduced as also ensuring that the revenue isgenerated in a timely manner for the Government. The DTVSV Act, in asense, provides a deviation from the strict application of tax laws towardsachieving this purpose. 15The benefits granted by the DTVSV Act are, however, by legislativepolicy not available to certain persons like those identified in Section 9(c) ofthe DTVSV Act. A perusal of Section 9(c) quoted earlier, shows thatLegislature, in its wisdom, has with a definite purpose, specifically carvedout and provided the persons to whom the DTVSV Act shall not apply andcases in which the benefits of the DTVSV Act would not be available tocertain persons. The purpose and intent behind the said provision is clearand unambiguous that the DTVSV Act would only apply to monies acquiredby legal means and not to monies generated from socio-economic offences.The purpose and intent of Section 9(c) of the DTVSV Act is to ensure thatthe DTVSV Act which is a piece of beneficial legislation, is not utilised forregularising or seeking benefits qua tainted monies or monies which fall under the shadow of a socio-economic offence. 16In this connection, it will be relevant to refer to the judgment of aDivision Bench of this court in Amit Hemendra Jhaveri (supra) wherein the Court whilst examining the vires of a similar provision under the KVSS was pleased to observe, inter alia, as under:- under the shadow of a socio-economic offence. 16In this connection, it will be relevant to refer to the judgment of aDivision Bench of this court in Amit Hemendra Jhaveri (supra) wherein the Court whilst examining the vires of a similar provision under the KVSS was pleased to observe, inter alia, as under:- “17. The State has filed an affidavit indicating that the policy/intentof KVSS 1998 to exclude offenders specified under s. 95(iii) DTVSVAct from the benefit of the KVSS 1998. The benefit of KVSS 1998 wasnot to be extended to all those who have, inter alia, income/propertywhich had been acquired by illicit means.The benefit of KVSS 1998was to all those whose income/property are acquired through legallypermissible process but not disclosed. The KVSS 1998 provides forimmunity from penalty and prosecution to those who make a validdeclaration thereunder. However the Parliament in its wisdom doesnot want to extend the benefit of KVSS 1998 to those persons whohad acquired income/property by illicit means and if the same was asubject of prosecution as listed out in s. 95(iii) DTVSV Act. It wouldtherefore be noticed that there is a policy underlying the exclusionunder s. 95(iii) of the KVSS 1998. Therefore, the differentialclassification made by Parliament has a nexus to the objective DTVSVAct which was extended by way of benefit to all assessees who havedisputes with, the Revenue pending before the authority under TheDTVSV Act or in the High Court. However, the aforesaid benefit underthe KVSS 1998 was not available to a person against whomproceedings have been instituted under the Penal Code, 1860,Prevention of Corruption Act, 1988, TADA, FERA and Narcotic Drugs-and Psychotropic SubstancesAct, 1985. It would therefore be noticedthat the class of people who have been left out of the benefit of KVSS1998 by virtue of s. 95(iii) thereof are those against whomproceedings/prosecutions have been initiated for various socialeconomic crimes as listed out therein. The objective DTVSV Act is toprovide a mutual benefit i.e. not only to collect revenue which islocked in litigation which will augment the State's resources but alsobenefit the taxpayer who on settling the dispute pays tax only at 30per cent of the declared income along with immunity from penaltyand prosecution. Once a classification as pointed out by the Revenueis found to be based on reasons, the mere fact that petitioner or theCourt is of the view that the classification could be better, would notentitle the Court to interfere with the classification as done by thelegislature. The role of the Court is limited only to ensure that theclassification is not arbitrary i.e. absence of intelligible differentiahaving a nexus to the object DTVSV Act. The Courts are not in anyway concerned whether the classification that is made in The DTVSVAct is the best possible in the available circumstances. This is purelywithin the domain of Parliament. 18. It is first contended by petitioner that ousting a person from the 18. It is first contended by petitioner that ousting a person from the benefit of KVSS 1998 in respect of whom a complaint has been filedin a criminal Court, alleging offences under Chapters IX and XVII ofthe Penal Code, 1860 is arbitrary. This it is submitted is in view of thefact that the complaint in the Criminal Court is filed on meresuspicion and if ultimately the person so excluded is discharged eventhen the benefit of KVSS 1998 would not be available. The legislationdoes not factor in the likelihood of honourable discharge. Thus it isarbitrary according to petitioner. The Parliament in its wisdom hasprovided a window period during which an offer of settlement underKVSS 1998 is kept open subject to certain conditions being satisfied-on the date of filing of the declaration. This providing of cutoff daysas held by the Supreme Court in NITDIP Textile Processors (supra)would always result in same disadvantage to some individuals but ineconomic legislations there has to be some free play on the joints. TheParliament in its wisdom did not desire to make the offer ofsettlement available to those under a shadow of culpability in respectof socioeconomic offences.This wisdom of Parliament of excludingpending prosecution’ from the benefit of KVSS 1998 is not for us toquestion so long it does have a nexus to the object of the KVSS 1998.This nexus to the object exists. Furthermore, the Apex Court in thecase of Sashi Balasubramaniam (supra) has held that benefit of theKVSS 1998 scheme is not to be extended to those against whom acomplaint is pending, therefore, this condition cannot be held to bearbitrary. 19. It is next contended by petitioner that the various categories listedout in s. 95(iii) of KVSS 1998 excluding them from the benefit ofKVSS 1998 are persons who are being prosecuted under Penal Code,1860, TADA, FERA, Prevention of Corruption Act, 1995, NarcoticDrugs and Psychotropic Substance Act, 1985. This according topetitioner has no nexus to the objective of collection of more revenue.This is not correct for the reason as pointed out above, the object ofthe KVSS 1998 is to collect the revenue which is otherwise stuck up indisputes in respect of persons who are not being prosecuted foroffences which are likely to be illegal/illicit income at the cost of thesociety. This benefit of KVSS 1998 would also grant immunity to suchpersons from penalty and prosecution which in the view of Parliamentis not justified/warranted. Further, one must not loose sight of thefact that the benefit under the KVSS 1998 is a deviation from thestrict application of tax laws. Thus the Challenge on the above groundis also not sustainable.20. The next contention urged by petitioner was that a person againstwhom prosecution has been launched for a minor crime as providedunder Chapter XVII of the Penal Code, 1860 is excluded by virtue of s.95(iii) of the KVSS 1998 from its benefit while a person against whomprosecution is lodged for serious crimes like murder etc., is notdeprived benefit of KVSS 1998. This itself, is evidence of the arbitrarynature of the exclusion having no nexus to the objective DTVSV Actwhich is undisputedly to collect revenue. As pointed out above, thepolicy DTVSV Act as set out in the affidavit-in-reply filed by the State-was to exclude those classes of persons who were involved in socioeconomic crimes having obtained income/property by illegal means.The State is prosecuting those persons under the criminal law of landfor having acquired/obtained income/property by committing breaches of the various Acts referred to therein. The classification isrestricted only to those persons who are involved in crimes which inParliament's experience/wisdom could have lead to generation ofincome/wealth/property. It is these classes of persons who have beenexcluded. This classification certainly has a nexus to the objectiveDTVSV Act namely recovering revenue which has been clogged andthe income which is being offered to tax under the KVSS 1998 is not-shadowed by a likelihood of the same having arisen from socioeconomic’ crimes for which prosecution has been launched asprovided in s. 95(iii) DTVSV Act. Serious crimes like murder etc per seaccording to the wisdom of Parliament, may have no nexus to thegeneration of income. In any case at the very highest, the grievance ofpetitioner appears to be that the classification is not proper and thereis room for more classification by including into, those categorieslisted in s. 95(iii) DTVSV Act, those who have been left out. Grievancemade is one of under inclusion.” (emphasis supplied) Clause 95(iii) of KVSS is similar and/or akin to Section 9(c) of theDTVSV Act and hence the above observations in Amit Hemendra Jhaveri(supra) would apply in the instant case as well. Therefore, there is a clear purpose and intent to the provisions ofSection 9(c) of the DTVSV Act which is to ensure that revenue which hasbeen clogged and the income which is being offered to tax is not shadowedby a likelihood of the same having arisen from socio-economic crimes forwhich prosecution has been instituted. The DTVSV Act does not and cannotbe read as providing a window to “regularise” tainted money. 17It has to be, at this point, noted that the pendency of criminalproceedings against petitioner is an admitted position. The petition itselfprovides which are the pending criminal proceedings against petitioner.There are two criminal proceedings pending against petitioner whereinpetitioner is charged for having conspired (Section 120B of IPC) to commitoffences of Cheating (Section 420 of IPC) as also offences under Section 13(1)(d) and Section 13(2) of the PC Act. The charge against petitionerwould have to be read as composite whole as framed and cannot besegregated, as read by Shri Nankani. 18It is, however, the case of petitioner that despite the pendency of thesetwo criminal proceedings, it would not fall within the ambit of Section 9(c)of the DTVSV Act since in the first proceeding prosecution has not yet beeninstituted and in the second proceeding, it is not punishable for offencesunder the PC Act. In our view, both these contentions are misconceived andbaseless. 19At the outset, with respect to the plea of prosecution not having beeninstituted, this issue stands squarely covered by Sashi Balasubramaniam(supra) wherein the Hon’ble Apex Court, whilst considering the provisionsof the KVSS and the provisions of Clause 95(iii) thereof, after raising aspecific issue as to when is a prosecution said to be instituted, answered thesame, inter alia, as under:- “28. The first information report in regard to the offences committed,as indicated hereinbefore, was lodged on 2-3-1995. The investigationstarted immediately thereafter. The investigation was being carried onby the Central Bureau of Investigation (Economic Offences Wing).Only at a much later stage, namely, more than three years thereafteri.e. on 31-12-1998, declarations were filed. Charge-sheet in thecriminal case was filed on 12-4-1999. “28. The first information report in regard to the offences committed,as indicated hereinbefore, was lodged on 2-3-1995. The investigationstarted immediately thereafter. The investigation was being carried onby the Central Bureau of Investigation (Economic Offences Wing).Only at a much later stage, namely, more than three years thereafteri.e. on 31-12-1998, declarations were filed. Charge-sheet in thecriminal case was filed on 12-4-1999. 29. It is in the aforementioned context that interpretation of the word"prosecution" assumes significance. The term "prosecution" wouldinclude institution or commencement of a criminal proceeding. It mayinclude also an inquiry or investigation. The terms "prosecution" and""cognizance are not interchangeable. They carry different meanings.Different statutes provide for grant of sanction at different stages.30. "In initio" means in the beginning. The dictionary meaning of"initiation" is cause to begin. Whereas some statutes provide for grantof sanction before a prosecution is initiated, some others postulategrant of sanction before a cognizance is taken by court. However, wp-464-21.doc meaning of the word may vary from case to case. In its wider sense,the prosecution means a proceeding by way of indictment orinformation, and is not necessarily confined to prosecution for anoffence.31. The term "prosecution has been instituted" would not mean when-chargesheet has been filed and cognizance has been taken. It must begiven its ordinary meaning.” (emphasis supplied) 20The aforesaid dictum of the Hon’ble Apex Court has also beenclarified in the case of Amit Jhaveri (supra) wherein this Court observed,inter alia, that “Furthermore, the Apex Court in the case of SashiBalasubramaniam (supra) has held that benefit of the KVSS 1998 scheme isnot to be extended to those against whom a complaint is pending, therefore,this condition cannot be held to be arbitrary.” In light of the above, both the proceedings are cases whereprosecution was instituted since in both cases an FIR had been duly lodged,thus casting a shadow on the monies sought to be offered to tax. 21The submission of Shri Nankani that the judgment of the Hon’bleApex Court in the case of Sashi Balasubramaniam (supra) does not consideror address the judgment in Jamuna Singh (supra) is not accurate. JamunaSingh (supra) was a case where the Hon’ble Court was considering theprovisions of the Criminal Procedure Code in respect of an offence under theIndian Penal Code, 1860. The Hon’ble Court was not considering theprovision of the KVSS or a law in relation to taxation laws. On the otherhand, the judgment in Sashi Balasubramaniam (supra) is in the specificcontext and with reference to the precursor law to the DTVSV Act andinterprets an almost identical and/or similar provision. 22In any event, the submission of petitioner that prosecution can be saidto be instituted only upon cognizance being taken is of no use to petitioneras even then cognizance was taken in the second proceeding wherechargesheet has been filed. Hence, the said issue would not arise. 23With respect to the second contention