Mumbai: In a 29-year-old case, a magistrate’s court last week convicted a private company, which no longer exists, of tax evasion and directed two of its then directors to pay Rs 20,000 as fine on behalf of the company.
The case was registered in December 1991 against six accused - of which one of the accused was the company - Rajan Tube Products Pvt. Ltd., the rest being its then managing director and four directors. The charge was framed in the case only in August last year, by which time, the managing director and two then directors had died and only two of the then directors of the company remained to face trial.
As per the complaint of the Deputy Commissioner of Income Tax, in the assessment year 1989 - 90, the company had a fixed deposit with a bank from which it earned interest income of Rs. 3,78,788. This amount the company and its directors had not declare in their return as income and had tried to evade tax on it.
The complainant appeared before the court and deposed during trial. Additional Chief Metropolitan Magistrate IR Shaikh however said in his judgment that the prosecution has failed to bring on record the balance sheet of the company to show that the two directors left to face trial had signed the balance sheet and that they were incharge of affairs of the company.
He acquitted them of the offences, but convicted the company and directed that they pay the fine imposed on the company as the offence was committed by the company of which they were directors.
