1959 (10) TMI 1 - SC - Income Tax

Supreme Court affirms acquittal, deems search illegal under penal code and criminal procedure

The Supreme Court upheld the High Court's decision, confirming the acquittal of the respondent under Section 358 of the Indian Penal Code. The Court ruled ... Application of Section 165 of the Code of Criminal Procedure to searches under administrative enactments - Searches under Rule 201 of the Central Excise Rules as investigations of an offence - Requirement to record reasons for conducting a search - Illegality of search under the Code vitiating consequent prosecution or convictionApplication of Section 165 of the Code of Criminal Procedure to searches under administrative enactments - Searches under Rule 201 of the Central Excise Rules as investigations of an offence - Whether searches authorised by Rule 201 of the Central Excise Rules must be carried out in accordance with the procedure laid down in Section 165 of the Code of Criminal Procedure - HELD THAT: - The Act (Section 18) expressly provides that searches under the Act and the Rules shall be carried out in accordance with the provisions of the Criminal Procedure Code relating to searches. Rule 201 authorises an excise officer to enter and search whenever he has reason to believe excisable goods are being processed, stored or carried in contravention of the Act or Rules; that object is to ascertain a contravention which is an offence. Section 165 prescribes stringent conditions for searches by a police officer during investigation of a cognizable offence, including reasonable grounds, recording in writing of those grounds and specification of things to be searched for, personal conduct of the search where practicable, and written reasons if a subordinate is authorised. Given the similarity in purpose-investigation of an offence-and the specific direction in Section 18, the Court held that the safeguards and procedural steps in Section 165 are applicable to searches under Rule 201 and must be followed. [Paras 6, 7]Section 165 CrPC governs searches under Rule 201 of the Central Excise Rules and its procedural conditions must be complied with.Requirement to record reasons for conducting a search - Illegality of search under the Code vitiating consequent prosecution or conviction - Whether failure to record reasons required by Section 165 renders the search illegal and whether recording of reasons is a jurisdiction-conferring requirement - HELD THAT: - The recording of reasons is not the source of the officer's jurisdiction, which is conferred by statute, but it is a necessary statutory step in the exercise of the search power under Section 165. Section 18's mandate that searches conform to the Code means that omission of material steps such as recording reasons would be ignoring essential provisions governing searches. Consequently, a search conducted in contravention of the recording requirement of Section 165 cannot be said to have been carried out in accordance with the Code, and is illegal. An argument that omission is a mere irregularity and does not entitle the person searched to resist the search was not permitted to be raised for the first time before the Court. [Paras 8, 9, 10]Failure to comply with the recording requirement of Section 165 renders the search illegal; compliance is a necessary condition for a valid search though the record does not itself create jurisdiction.Final Conclusion: The search by the Deputy Superintendent was held illegal for non-compliance with Section 165 CrPC as applicable to Rule 201 searches; the High Court's confirmation of the respondent's acquittal is upheld and the State's appeal is dismissed. Issues:1. Appeal against acquittal under Section 358 of the Indian Penal Code.2. Distinction between power to search and manner of making it under the Central Excises and Salt Act and Criminal Procedure Code.3. Applicability of Section 165 of the Criminal Procedure Code to searches authorized under Rule 201 of the Central Excise Rules.4. Jurisdiction and procedure for making a search by excise officers.5. Legality of search conducted without following Section 165 of the Criminal Procedure Code.6. Impact of not recording reasons for search by the Deputy Superintendent.7. Argument regarding irregularity in not recording reasons for search.Analysis:The case involved an appeal against the acquittal of the respondent under Section 358 of the Indian Penal Code. The Deputy Superintendent of Central Excise conducted a search at the respondent's house without following the procedures outlined in Section 165 of the Criminal Procedure Code. The appellant contended that the search was illegal as it did not comply with the statutory provisions governing searches under the Central Excises and Salt Act and the Criminal Procedure Code.The appellant raised two main points before the Supreme Court. Firstly, they argued that there is a distinction between the power to search and the manner of conducting the search under the Central Excises and Salt Act and the Criminal Procedure Code. The appellant emphasized that the Deputy Superintendent's search did not align with the procedures specified in Section 165 of the Code, which applies to searches made by police officers during the investigation of an offense. The appellant asserted that the excise officer should have followed the procedural requirements of Section 165.Secondly, the appellant contended that the recording of reasons for a search does not confer jurisdiction on the officer but is a necessary condition for conducting a search. The appellant highlighted that Section 18 of the Act mandates searches to be carried out following the provisions of the Criminal Procedure Code, particularly Section 165. The Court agreed with the appellant's arguments and held that the search conducted by the Deputy Superintendent without complying with Section 165 was illegal.The Court also addressed the argument that the failure to record reasons for the search was merely an irregularity and did not give the respondent the right to obstruct the search. However, the Court dismissed this contention, stating that it was not raised earlier and could not be considered at that stage. Ultimately, the Supreme Court upheld the High Court's decision, confirming the acquittal of the respondent under Section 358 of the Indian Penal Code.