TaxTMI 
TaxTMI 
TaxTMI 
2015 (2) TMI 819
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....r allied activities. According to the appellants, exhibit PI notice issued by the second respondent is not only illegal but arbitrary. 2. The appellant-societies approached the learned single judge questioning the legality of exhibit P1 notice and also competency of the second respondent to issue the same. As per exhibit P1 notice, societies were required to furnish the details of entire cash deposits in savings bank accounts where the aggregate cash deposit is rupees five lakhs and above in an year for the last three previous years. Identifying such cases from thousands of depositors is not only a laborious task but encroaching on the affairs and business activities of co-operative societies. Exhibit P1 notice lacks details as to for what purpose such notice was issued and it is issued by the authority which is not included in section 133(6) of the Income-tax Act. 3. According to appellants, the State Legislatures have been given exclusive power to make laws in respect of matters enumerated in List II of the Seventh Schedule of the Constitution of India. Entry No. 43 of List I of the Seventh Schedule refers to incorporation, regulation and winding up of trading corporations, inc....
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....ur notice the case in Dr. N. S. D. Raju v. Director-General of Income-tax (Investigation) [2006] 283 ITR 154 (Ker) so far as the powers exercised by the Assessing Officer as per section 2(7A) of Income-tax Act. He also brought to our notice notification dated August 19, 2011. By virtue of the powers conferred by section 120 of the Income-tax Act, Directors of Income-tax specified in column (2) of schedule 2 shall issue orders in writing to the Income-tax authorities subordinate to them for exercise of such powers under the Income-tax Act by them, which includes details or territorial areas coming under their jurisdiction. As per this notification, according to the learned standing counsel, the Director of Income-tax (Intelligence), Kochi, has powers to issue such directions to all co-operative societies within the State of Kerala so far as all powers conferred under the Income-tax Act in relation to collection, collation, verification and dissemination of information in respect of territorial area. Order dated November 1, 2011, is issued by the Office of the Director of Income-tax (Intelligence), Kochi, giving details of Income-tax authorities who could function as against the post....
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....ssued to the societies under section 133(6) of the Act calling for particulars of cash transaction above rupees one lakh with details of account holders/deposit holders in the format prepared by the authority issuing the notices. The societies challenged the validity of the notices. After referring to section 133(6) of the Act, prior to the introduction of the second proviso and its effect and after the introduction of the second proviso to section 133(6), their Lordships opined that there was no scope for interfering with validity of notices. 8. Then coming to the crucial issue whether general notice calling for cash particulars including deposits above a particular amount issued by the concerned officer with the prior approval of the officer concerned, as the case may be, their Lordships opined that all the notices were issued by the same authority which obviously mean that there was prior approval from the Commissioner or Director, as the case may be. 9. Section 133(6) and provisos read as under : "133. Power to call for information.-The Assessing Officer, the Deputy Commissioner (Appeals), t....
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.... result in initiation of proceedings under the Act. 41.3 With a view to having a clear legal sanction, the existing pro visions to call for information have been amended. Now, the income- tax authorities have been empowered to requisition information which will be useful for or relevant to any enquiry or proceedings under the Income-tax Act in the case of any person. (emphasis supplied) The Assessing Officer would, however, continue to have the power to requisition information in specific cases in respect of which any proceeding is pending as at present. However, an Income-tax authority below the rank of the Director or Commissioner can exercise this power in respect of an inquiry in a case where no proceeding is pending, only with the prior approval of the Director or the Commissioner." They also referred to Karnataka Bank Ltd. v. Secretary, Government of India [2002] 255 ITR 508 (SC) at paragraph 13 of the judgment, which reads as under (page 253 of 360 ITR) : "Keeping in view the aforesaid, we would now refer to the contentions of the learned counsel for the parties. It is the case of the assessee ....
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....omething'. The Merriam-Webster Unabridged Dictionary states that the words 'inquiry or enquiry' connote : '1 : examination into facts or principles. 2 : a request for information. 3 : a systematic investigation often of a matter of public interest.' The Cambridge Advanced Learner's Dictionary and Thesaurus defines inquiry or enquiry as 'question' or 'the process of asking a question.' The Oxford Advanced Learner's Dictionary defines enquire as : 'an official process to find out the cause of something or to find out information about something ; a request for information about somebody/something ; a question about somebody/something ; the act of asking questions or collecting information about somebody/ something.' The Black's Law Dictionary, 9th Ed., 2009, page 864, defines 'enquiry' as 'a request for information, either procedural or substan tive'. The expression inquiry under Encyclopedia Law Lexicon, Vol. 4, Ashoka Law House, 2008/09, page 2356 and K. J. Aiyar's Judicial Dictionary, Vol. 1, Lexis Nexis Butterworths Wadhwa, 15....
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....e may be, before issuance of such notice. The word 'enquiry' would thus connote a request for information or questions to gather information either before the initiation of proceedings or during the pendency of proceedings ; such information being useful for or relevant to the proceeding under the Act. This court in Karnataka Bank Ltd. v. Secretary, Government of India [2002] 9 SCC 106 ; [2002] 255 ITR 508, 510 (SC), has examined the proposition whether a notice under section 133(6) could be issued to seek information in cases where the proceedings are not pending and construed section 133(6) of the Act. The petitioner therein was a financial institution which had impugned the notice issued under section 133(6) on grounds that the notice requiring furnishing of information in respect of its customers regarding payment of loans when no enquiry was pending was not envisaged by the said sub-section. This court has observed as follows : "3. It is clear from the mere reading of the said provision that it is not necessary that any inquiry should have commenced with the issuance of notice or otherwise before section 133(6) could h....