CA Final · Direct Tax Laws & International Taxation · Tax Planning, Tax Avoidance and Tax Evasion
Ravi, who had been granted immunity under the Income-tax Act, 2025 for giving evidence on tax evasion by a trading syndicate, was later found by the Central Government to be giving false evidence. What is the consequence?
The Central Government may record a finding of false evidence, whereupon the immunity is deemed withdrawn. Ravi can then be tried for the offence for which immunity was tendered, or any other offence connected with the matter, and also becomes liable to the penalty he would otherwise have faced.
- AThe Central Government may record a finding to that effect and the immunity is deemed withdrawn, after which Ravi may be tried and penalisedCorrect
- BImmunity continues for the offence tendered but is lost only for other offences
- CImmunity is withdrawn only after a court convicts Ravi of perjury
- DRavi remains immune from prosecution but becomes liable to penalty
Explanation
Under section 519(3), if the person does not comply with the conditions, wilfully conceals anything or gives false evidence, the Central Government may record a finding and the immunity is deemed withdrawn. Under 519(4) he may then be tried for the offence tendered or any other related offence and becomes liable to the penalty. The distractor that keeps prosecution immunity is wrong because withdrawal removes both protections.
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