1993 (9) TMI 56 - HC - Income Tax

Court orders return of seized documents to petitioner, discharges Special Officer. Parties must comply with orders.

The court ordered the return of seized documents, books, and share scrips to the petitioner within a week, and discharged the Special Officer overseeing ... Assessing Officer, Search And Seizure Issues:Return of seized documents and share scrips under section 132(8) of the Income-tax Act, 1961.Analysis:The petitioner sought the return of documents and share scrips seized during a search and seizure at their premises on December 23, 1981, under section 132(8) of the Income-tax Act, 1961. The petitioner argued that the authorities had no authority to retain the seized items beyond the specified period without recording reasons and obtaining approval from the Chief Commissioner or Commissioner. Judicial decisions have established specific conditions for retention, including recording reasons, obtaining approval, communicating reasons and approval to the assessee, and timely communication. The petitioner contended that the last two preconditions for retention were not met after June 30, 1983.The respondents claimed that the Assessing Officer had applied for approval from the Commissioner for retention of the seized documents, and the Commissioner had approved the retention until June 30, 1983. Subsequent extensions were granted until March 31, 1987, with orders allegedly communicated to the petitioner. However, the petitioner argued that the reasons recorded by the Assessing Officer and the Commissioner's orders were not served as required. The court found discrepancies in the service of orders dated June 23, 1983, and June 21, 1984, as the records did not support the claims made by the respondents.The respondents contended that the court should not decide on the service issue, suggested the petitioner seek remedy under section 132(10) of the Act, and invoked the presumption under section 114(e) of the Evidence Act. However, the court rejected these contentions. It found that the presumption of regular performance of official acts did not apply when the act's performance itself was in question. The court also noted that the requirement of serving the recorded reasons of the Income-tax Officer was crucial, and the presumption did not cover this aspect.Regarding the respondent's argument of the petitioner's suppression of facts, the court held that even if the last order of the Commissioner was received by the petitioner, the non-service of the recorded reasons of the Income-tax Officer was sufficient for the petitioner to succeed. Consequently, the court ordered the return of seized documents, books, and share scrips to the petitioner within a week, and discharged the Special Officer appointed to oversee the seized share scrips.In a subsequent order, the court directed the special officer to return not only the share scrips but also the books of account and documents to the petitioner. The petitioner was instructed to pay the special officer for their services, and all parties were required to act on the court's orders. Xerox copies of the judgment were to be provided to the parties for obtaining certified copies upon payment of usual charges.