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Criminal Revision Application No. 16 of 1974, decided on 29^thNovember 1974.

-- S. 561-A & Income-tax Act (XI of 1922), Ss. 51(2), 52 & 66(1) Stay of criminal proceedings pending civil litigation-Pending reference under S. 66(1), Income-tax Act, 1922 before High Court case under Ss. 51(2) & 52 instituted against applicant before Special Judge-Matter in dispute in both Courts being same, criminal proceedings stayed till decision of reference under S. 66(1).

If the criminal liability is dependent upon the results of the civil litigation or is so intimately connected with it, the criminal proceedings better be stopped if the circumstances of the case so required.

N. Mankejee v. Fakhar Iqbal and another 1969 S C M R 199; Muhammad Akbar v. State and another P L D 1968 S C 281 and Iqbal Khan v. Sarkar P L D 1971 Azad J & K 44 ref.

Z. U. Ahmed for Applicant.

A. R. Kazi for the State.

Date of hearing : 7th November 1974.

The circumstances in which this petition under sections 435, 439 read with section 561-A, Cr. P. C. has been filed, are as follows:--

1. The applicant is the Managing Director of Messrs International Packing Company Ltd., Karachi. It is alleged that for the accounting year ending 31st March 1968, the applicant filed income-tax returns of the Company, duly verified by him. The Income-tax Officer before whom the matter proceeded, held that the purchases of raw material amounting to Rs. 4,63,300 were "bogus purchases in order to increase the expenditure with a view to conceal the particulars of their income," and the parties mentioned therein were fictitious. Otherwise too, according to him, the entries in the Register were not genuine. He, therefore, after getting the approval from the Central Board of Revenue, filed a complaint on 14-4-1973 in the Court of the Special Judge, Central, Karachi, under sections 51(2) and 52 of the Income-tax Act.

2. It appears that the applicant, prior to the institution of this complaint, had filed an application in this Court under section 66(1) of the Income Tax Act, which is pending disposal. It is I. T. R. No. 120 of 1972.

3. On 16-7-1973 the applicant had filed a similar application in this Court, praying that the proceedings before the Special Judge be quashed, or in the alternatives, be stayed. The application came to be dismissed on 27-8-1973 on the ground that it was premature, as there was no application filed in the first instance before the Special Judge. It was thereafter that the applicant filed an application under section 344(1) of the Code of Criminal Procedure before the Special Judge, which came to be dismissed on 10-11-1973. The instant application has been filed thereafter.

4. The main contention advanced by Mr. Z. U. Ahmed, learned counsel for the applicant, was that as the question of the addition of Rs. 4,63,300 because of the unverifiability of the purchases was to be considered in the reference here, the prosecution of the applicant was not warranted. In support of the contention, reliance was placed on N. Manekjee v. Fakhar Iqbal & another (1969 S C M R 199), Mohammad Akbar v. State and another (P L D 1968 S C 281) and Iqbal Khan v. Sarkar (P L D 1971 A J & K 44). The principle laid down in these cases is that if the criminal liability is dependent upon the results of the civil litigation or is so intimately connected with it, the criminal proceedings had better be stopped if the circumstances of the case so required.

5. Looking to the circumstances disclosed, it would be in the fitness of things that the proceedings pending before the Learned Special judge are stayed till the disposal of the Income Tax Reference, referred to above. It is ordered accordingly. The applicant would notify the decision of this Court in the aforesaid reference to the Special Judge without any loss of time.

Proceedings stayed.

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