Mukesh S Singh :
THE Delhi High Court has dis
missed the writpetition filed
by Saumya Chaurasia, former
Deputy Secretary to ex-Chief
Minister Bhupesh Baghel,
thereby upholding the Income
Tax Department’s decision to
prosecute her in an alleged
Rs 348 crore tax evasion case.
The Bench of Justice V
Kameswar Rao and Justice
Vinod Kumar held that the prosecution sanction granted by the
Principal Commissioner of
Income Tax (PCIT) was valid and
E
X
CLUSIVE
that Central Board of Direct
Taxes (CBDT) Circular No.
5/2020, which allows prosecution even before penalty confirmation by the Income Tax
Appellate Tribunal (ITAT), does
not offend Article 14 of the
Constitution. The Court
observed that the intent behind
the circulars was to ensure that
only serious, high-value cases
are prosecuted while smaller
matters await appellate confirmation.
Chaurasia’s residence in Bhilai was searched
in 2020 during a tax investigation into alleged unaccounted
income linked with business
transactions across State. The
case was later centralised in
Delhi, and assessment orders
covering eight financial years
from 2011-12 to 2022-23 raised
an aggregate demand exceeding Rs 348 crore. Meanwhile, she
faced parallel investigations by
ED and SEOIACB in connection
with the alleged coal levy and
liquor policy cases during the
previous government’s tenure.
She was arrested in 2022 and
later granted interim bail by
the Supreme Court in 2024. The PCIT’s sanction authorised her prosecution under
Sections 276C (wilful attempt to evade tax) and 278E (presumption of culpable mental state) of the Income Tax Act.
Arguing through Senior Advocate Balbir Singh, Chaurasia
claimed that prosecution should begin only after penalty
confirmation by the ITAT and that the sanction orders
lacked reasoning.Her petition further asserted that the CBDT
circulars were arbitrary, gave unrestrained discretion to tax
officials, and were violative of Article 14. She also contended
that additions to her income were based merely on loose
papers seized during the search and were not adequate for
criminal prosecution.
Rejecting these contentions, the High Court held that in
search and survey cases under Sections 132, 132A and 133A,
prosecution may be initiated at any stage with prior approval
of the PCIT.
The Bench noted that the magnitude of the
alleged evasion justified immediate action and that no ITAT
confirmation or collegium approval was required before
hand. The Court described CBDT Circular 5/2020 as a rea
sonable administrative measure designed to fast track proceedings in major evasion cases.
The Bench further ruled that the circulars were neither
manifestly arbitrary nor unconstitutional and that they
draw a rational distinction between minor and major
offences. It said that factual disputes, including the evidentiary value of seized papers, must be decided.