Asstt. Commissioner vs Velliappa Textiles Ltd.

The Supreme Court held that the High Court's quashing of the criminal complaint against M/s. Velliappa Textiles Ltd. and its Managing Director under Sections 276C, 277, and 278 read with Section 278B of the Income Tax Act was improper. The Court established that a company, as a juristic person, can be prosecuted, and the sanction under Section 279(1) must comply with the principles of natural justice. The Court allowed the appeal, setting aside the High Court's order, and directed that fresh sanction be granted after affording an opportunity of hearing to the respondents.