Satish (Proprietor) 23 March 2014

Tax evasion case

Hi,

Mr. X is a contractor doing business since 2005 and every year he has crossed the audit limit according to his 26AS TDS data, but till date he has not done any audit, except A.Y.13-14 now he has got notice from service tax department to produce all financial data since 2005 and now Mr.X is blaming his consultant who is my cousin and he is an advocate, According to Mr. X my cousin is not advised his to do the audit.

The real fact is Mr. X use to open bank accounts with different bank with same name and use to produce one account which has less transactions and his consultant use to file his return according to his produced data.

Mr.X has not paid service tax almost Rs.50 Lakh, Vat Rs. 70Lakh, between these years

But now he is blackmailing to his consultant, saying that he will make some case against him that he has not guided him properly. His consultant is my relative and he is a very prestigious man has a good reputation in the society, I got this from his family, now my cousin wants to report all this to Anti Tax Evasion cells, but I requested him to do not go for it.

My question is can Mr. X succeed if he register any case against my cousin?

Please let me know am I right?

I care about my cousin’s family and his future.

I’ll be thankful if you can guide me properly.

Regards

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2 Replies

Satish (Proprietor) 24 March 2014

Please expert reply................

T. Kalaiselvan, Advocate (Advocate) 25 March 2014

Mr. X cannot claim exemption from the tax liability by just throwing the blames on his tax consultant/auditor. The act of suppression of facts material to tax return was done intentionally by X because the auditor is not an astrologist to find out various other sources of X which was neither disclosed nor revealed by X to his auditor/consultant. Therefore the consultant/auditor cannot be held responsible for the intentional wrong doing by X. If x is intending to proceed against your cousin, X will be doing so on his own risk for which he may have to face the legal consequences. thus, it is advisable that better Mr. X to settle the tax to the department and get relieved from the legal problems thereon.