The Delhi High Court has recently approved initiating prosecution proceedings against an individual taxpayer for not filing ITR and failing to respond to the tax notices sent to them.
The Delhi HC has held that prosecution can be initiated even if assessment has not been completed in case of the taxpayer, ie. default is triggered on non-filing of return itself. The HC has observed that assessment and prosecution proceedings can go simultaneously. “This approach, however, could have serious bearing on taxpayers who may have missed filing their tax return, whatever be the reason for the default. In case of prosecution proceedings, the taxpayer would be required to demonstrate that the default was not deliberate or willful.” say experts.