TaxTMI 
TaxTMI 
2009 (11) TMI 341
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....o go to Chennai with a large sum and finalise the deal. He contacted the Reserve Bank of India, ICICI Bank (his banker) and the airport authorities to find out whether he could carry a large sum of money in cash, while travelling. He was informed that there was no prohibition. Thereafter, he drew Rs. 65 lakhs from his bank. He travelled by air from Hyderabad to Chennai on June 15, 2007, carrying the said cash. At the Hyderabad air-port, he disclosed to the security personnel who checked his baggage that he was carrying cash of Rs. 65 lakhs along with a bank certificate certifying the source and withdrawals. After the contents of his bags were examined by the security personnel, he was allowed to board the aircraft without any objection. But when the flight reached Chennai, some police officers and others (who were later identified as officers of the Income-tax Investigation Wing) rushed in, loudly called out the name of the appellant. When the appellant identified himself, he was virtually pulled from the aircraft and taken to an office in the first floor of the airport. He was questioned there about the money he was carrying. The appellant showed them the cash and bank certificate....
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....letely false picture of the incident. The said acts, according to him, tarnished his reputation among his friends, relatives and acquaintances, by being dubbed as some sort of a criminal. Being aggrieved, he filed a writ petition (W. P. No. 27344 of 2007) in the High Court of Andhra Pradesh in December, 2007, seeking several reliefs. He sought action against the income-tax officials and the newspapers. He also sought compensation for the illegal acts, and quashing of the proceedings initiated against him under the Income-tax Act, 1961. He sought appropriate directions for reforming and streamlining the procedure relating to checking of passengers. He also sought some consequential reliefs. He impleaded four officers of the Income-tax Department, the Director of the Hyderabad Airport and the editors of the three Tamil newspapers as respondents. 4. The said writ petition was dismissed by the High Court on June 17, 2008, on the ground that no part of the cause of action arose within Andhra Pradesh. The contentions raised by the appellant were not considered. The court directed the appellant to approach the appropriate court at Chennai. The said order is challenged in this appeal by....
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....ations and investigations to be efficient, passenger-friendly and courteous. Secondly, he wants the Department/concerned officers to acknowledge that he was unnecessarily harassed. 7. As the first issue required a decision at the level of the concerned Ministry and Central Board of Direct Taxes, instead of remitting the matter to the High Court, we requested Mr. Gopal Subramanium, the learned Solicitor General to take notice and suggest a solution. He agreed to have the matter examined as to whether there was a need for issue of guidelines. 8. Taking note of the issue, the Central Board of Direct Taxes, Ministry of Finance has issued a circular dated November 18, 2009, setting out the guidelines to be followed by Air Intelligence Units or Investigation Units while dealing with air passengers with valuables at the airports of embarkation or destination, to avoid any undue inconvenience to them. The said circular is extracted below: "Subject: Avoiding harassment in the course of enquiry/search of the air passengers by the Air Intelligence Units/Investigation Units of the Income-tax Department. Detailed procedure regarding enquiry and identification of th....
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....read to him before asking for his signature. He should be given full opportunity to go through the statement, questions as well as answers, before putting his signature and to make amendments under his signature if there is variation in what he said and what was recorded. It should be ensured that what is recorded is stated voluntarily with-out any coercion. At the end of the statement, the passenger should be requested to write in his own handwriting that it was given voluntarily and it recorded truthfully what was stated by him. (v) The procedure regarding administering of oath may be duly followed. (vi) The proceedings of enquiry and action may be completed as expeditiously as possible. In the course of these proceedings, the passenger should be provided drinking water, tea, snacks and food in case the passenger desires the same. He should also be provided medical assistance in case it is required. (vii) In case the seizure involves bullion or jewellery, the services of an approved valuer should be obtained expeditiously. For this purpose, while granting approval under section 34AB of the Wealth-tax Act, the Chief Commissioners/Director Generals should....
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....he delay and seizure were inevitable. 10. We are in agreement with the submissions of the learned Solicitor-General. When the bona fides of a passenger carrying an unusually large sum, and his claims regarding the source and legitimacy, have to be verified, some delay and inconvenience is inevitable. The inspecting and investigating officers have to make sure that the money was not intended for any illegal purpose. In such a situation, the rights of the passenger will have to yield to public interest. Any bona fide measures taken in public interest, and to provide public safety or to prevent circulation of black money, cannot be objected to as interference with the personal liberty or freedom of a citizen. We are satisfied that the actions of the officers of the investigation wing in detaining the appellant for questioning and verification, and seizing the cash carried by him, were bona fide and in the course of discharge of their official duties and did not furnish a cause of action for claiming any compensation. The nation is facing terrorist threats. Transportation of large sums of money is associated with distribution of funds for terrorist activities, illegal pay offs, etc.....
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.... intended for commission of a crime or offence. 12. It is not only the security/intelligence personnel who require to be sensitised, but also the air travelling public some of whom throw tantrums and create scenes at airports, even for minimum delays and checking procedures. When security protocols are in place, certain hardship and inconvenience is inevitable, and should be accepted with grace, patience and discipline. Many a traveller forgets that the vigilance and checks are meant for their own interest. 13. But the appellant's grievance in regard to media being informed about the incident even before completion of investigation, is justified. There is a growing tendency among investigating officers (either police or other departments) to inform the media, even before the completion of investigation, that they have caught a criminal or an offender. Such crude attempts to claim credit for imaginary investigational breakthroughs should be curbed. Even where a suspect surrenders or a person required for questioning voluntarily appears, it is not uncommon for the investigating officers to represent to the media that the person was arrested with much effort after considerab....