Conviction in case of partner in relating matter of it
Vithal. Upari
(Querist) 28 December 2017
This query is : Resolved
Dear Experts
Case Facts : One of the partner of XXXXX Gold ., who collected money from 3000 persons and in return he gave gold during the time of Demonitization period now he has collected almost 6 Cr and same has been deposited in firm's current account. Notice of Income tax U/s 131 has been received by him for further clarifications where he initially told that he collected 4 Crores and later he admitted 6 Cr after documents produced by IT. Now on the prosecution part -who ultimately held liable ? Is it a partner ? or Firm ? If partner alone then on what grounds he will be convicted ? if firm is not then on what ground it also be part of conviction or mere penalty is sufficient ? Whether prosecution can be on all partners or on a partner ? Please read this case along with Sections 276, 277 and 278B of Income Tax Act 1961. If any relevant citations please do share...
Please suggest..
Regards
Vithal
R.Ramachandran
(Expert) 29 December 2017
It all will depend upon as to how the Income Tax Department proceeds. In any case, the partners cannot disassociate from the activities of other partners. Therefore you have to wait and act as and when the department take action.
