Custody of seized assets during tax investigation turns on investigative material and limits on revisional interference

Where seized gold biscuits and currency are treated as possible undisclosed income during an ongoing investigation, the discussion states that investigative material, including statements recorded under section 161 of the Code of Criminal Procedure, 1973, may justify keeping the assets with the Income-tax Department for enquiry and assessment. It further notes that revisional interference is not warranted unless the appellate custody finding is illegal, perverse, or otherwise unsustainable. The article also records that later-produced documents may be viewed with caution when they conflict with materials collected in the course of investigation.

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Issues: Whether the seized gold biscuits and currency were rightly directed to be released to the Income-tax Department under the claimed requisitionary power, and whether the revisional court should interfere with the appellate court's order.

Analysis: The seized articles were claimed by the Income-tax Department as undisclosed assets or income, and investigation was already in progress. The appellate court was entitled to consider the materials recorded in the course of investigation, including statements under section 161 of the Code of Criminal Procedure, 1973, which supported the department's claim and cast doubt on the later-produced documents. The revisional court found no legal infirmity, perversity, or unsustainability in the appellate court's conclusion that the articles should remain with the Income-tax Department for enquiry and assessment. The order was treated as a proper exercise of jurisdiction in the circumstances.

Conclusion: The direction to release the seized gold biscuits and currency to the Income-tax Department was upheld, and interference in revision was declined.

Final Conclusion: The revisions failed, and the appellate order in favour of the Income-tax Department stood confirmed.

Ratio Decidendi: Where seized property is under investigation as possible undisclosed income and the appellate finding on entitlement to custody is neither illegal nor perverse, revisional interference is not warranted.

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