Section 132(3) cannot freeze an ordinary savings account; bank deposits are not seized as property in possession or control.

Section 132(3) of the Income-tax Act cannot be invoked to issue a prohibitory order against an ordinary savings bank account. The provision applies only to money or valuable articles that are in a person's immediate possession or control and are capable of search or seizure under section 132(1). A general bank deposit is a debtor-creditor relationship, so it is not money in the depositor's custody for this purpose. If account records suggest undisclosed income or escapement, the proper remedy is assessment proceedings, not freezing the account under section 132(3).

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Issues: Whether the authorised officer could invoke section 132(3) of the Income-tax Act, 1961 to issue a prohibitory order against a bank in respect of money standing to the credit of a savings bank account.

Analysis: The power under section 132 is confined to money, bullion, jewellery or other valuable article or thing in respect of which the prescribed belief exists that it represents undisclosed income or property and which is capable of being searched or seized under section 132(1). Section 132(3) operates only where such articles or money are in the immediate possession or control of a person and it is not practicable to seize them. A general bank deposit is not money in the depositor's possession or custody in the sense contemplated by the section, because the legal relationship between banker and customer in respect of a general deposit is one of debtor and creditor. If the bank pass book or account records reveal possible escapement of income, the proper course is assessment action under the Act, not a prohibitory order under section 132(3). The section cannot be extended to restrain operation of an ordinary savings account.

Conclusion: The prohibitory order issued under section 132(3) against the bank account was without jurisdiction and invalid.

Ratio Decidendi: Section 132(3) cannot be used to freeze or restrain an ordinary bank deposit, because such deposit is not money in the depositor's possession or control capable of seizure under section 132(1).

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