Initiation Of Prosecution U/S 51 Of Black Money Act Not Dependent On Completion Of Assessment Proceedings U/S 10 For Tax Evasion: Delhi HC

The Delhi High Court has held that initiation of prosecution under Section 51 of the Black Money Act, 2015 is not dependent on completion of assessment proceedings initiated against an accused under Section 10 to determine tax evasion. It is relevant to note that the assessment under the Black Money Act is being made under Section 10, which falls in Chapter III of the Act…The initiation of the prosecution is not dependent on the completion of assessment, if the conditions as required under Section 51 Black Money Act are fulfilled.” In the case at hand, the Petitioner is accused of holding undisclosed foreign bank accounts and properties and it was alleged that he was preparing to alienate his foreign assets and offshore entities by backdating documents to evade taxes under the Black Money Act. The High Court held, “Section 51 of Black Money Act would come into play if even before filing of a return of income, the person is found to have done any of the acts as prescribed in Section 51 of Black Money Act, 2015. As the offence, if proved, stands completed as soon as the conditions as required under Section 51 of Black Money Act, 2015 are fulfilled, irrespective of return of income.” The Court said though Petitioner had denied ownership of foreign assets, the Department will be obliged to produce evidence in this regard at an appropriate time during trial.