TaxTMI 
TaxTMI 
2021 (12) TMI 104
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....estigation) and the third petitioner is the Principal Commissioner of Income-Tax (Central). The 2nd respondent is the complainant. On 15.03.2016, search and seizure proceedings were initiated by the petitioners in terms of Section 132 of the Income Tax Act, 1961 ('the Act' for short) on the residential premises of the complainant and several incriminating documents including a diary that was found during the search were seized. The diary was found in the bedroom of the complainant. According to the petitioners, the diary had recordings of various transactions with abbreviations and amounts against each of the abbreviations. 3. The complainant was, at that point in time, holidaying at Goa. A search warrant that was issued against the complainant was executed even at the hotel room, where the complainant was staying. The complainant returned to his residence and during the course of search, statement of the complainant was recorded under Section 132(4) of the Act, confronting the complainant with the contents of the seized incriminating materials including the diary. Several statements were later recorded by the petitioners in furtherance of the proceedings under Section 1....
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....kiran Shetty, learned senior Advocate for Sri Sandeep, learned Advocate for the 2nd respondent. 8. The learned counsel appearing for the petitioners would vehemently argue and contend that the very registration of FIR against the petitioners is not maintainable as there is protection to the act of the petitioners under Section 293 of the Act and under Section 138 of the Act any document or incriminating material seized in a search and seizure proceedings under Section 132 of the Act, cannot be handed over or divulged as Section 138 of the Act begins with a non-obstante clause. Section 91 of the Cr.P.C. cannot override the provisions of either under Sections 132, 138 or under Section 293 of the Act. 9. On the other hand, the learned senior counsel representing the 2nd respondent/complainant would vehemently refute the submissions and contends that the writ petition itself is not maintainable as the petitioners are not even named in the FIR and what is called in question is only a notice issued under Section 91 of the Cr.P.C. to which the petitioners would be at liberty to file reply and justify their stand that they would not be in a position to release the diary. Rushing to t....
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....r thing represents either wholly or partly income or property which has not been, or would not be, disclosed for the purposes of the Indian Income Tax Act, 1922 (11 of 1922), or this Act (hereinafter in this section referred to as the undisclosed income or property), then,-- (A) the Principal DirectorGeneralor Director Generalor Director or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner], as the case may be, may authorise any Additional Director or Additional Commissioner or Joint Director, Joint Commissioner, Assistant Director or Deputy Director, Assistant Commissioner or Deputy Commissioner or Income Tax Officer, or (B) such Additional Director or Additional Commissioner or Joint Director or Joint Commissioner, as the case may be, may authorise any Assistant Director or Deputy Director, Assistant Commissioner or Deputy Commissioner or Income Tax Officer (the officer so authorised in all cases being hereinafter referred to as the authorised officer) to-- (i) enter and search any building, place, vessel, vehicle or aircraft where he has reason to suspect that such books of account, other documents, money, bullion,....
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....sioner] having jurisdiction over such person may be prejudicial to the interests of the revenue: Provided further that where it is not possible or practicable to take physical possession of any valuable article or thing and remove it to a safe place due to its volume, weight or other physical characteristics or due to its being of a dangerous nature, the authorised officer may serve an order on the owner or the person who is in immediate possession or control thereof that he shall not remove, part with or otherwise deal with it, except with the previous permission of such authorised officer and such action of the authorised officer shall be deemed to be seizure of such valuable article or thing under clause (iii): Provided also that nothing contained in the second proviso shall apply in case of any valuable article or thing, being stock-in-trade of the business. Provided also that no authorisation shall be issued by the Additional Director or Additional Commissioner or Joint Director or Joint Commissioner on or after the 1st day of October, 2009 unless he has been empowered by the Board to do so. Explanation.-- For the removal of doubts, it is he....
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....s sub- section. Explanation.--For the removal of doubts, it is hereby declared that serving of an order as aforesaid under this sub-section shall not be deemed to be seizure of such books of account, other documents, money, bullion, jewellery or other valuable article or thing under clause (iii) of sub-section (1). (4) The authorised officer may, during the course of the search or seizure, examine on oath any person who is found to be in possession or control of any books of account, documents, money, bullion, jewellery or other valuable article or thing and any statement made by such person during such examination may thereafter be used in evidence in any proceeding under the Indian Income Tax Act, 1922 (11 of 1922), or under this Act. Explanation.--For the removal of doubts, it is hereby declared that the examination of any person under this sub-section may be not merely in respect of any books of account, other documents or assets found as a result of the search, but also in respect of all matters relevant for the purposes of any investigation connected with any proceeding under the Indian Income Tax Act, 1922 (11 of 1922), or under this Act. ....
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....eived or obtained by any income-tax authority in the performance of his functions under this Act, the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner may, if he is satisfied that it is in the public interest so to do, furnish or cause to be furnished the information asked for and his decision in this behalf shall be final and shall not be called in question in any court of law. (2) Notwithstanding anything contained in sub-section (1) or any other law for the time being in force, the Central Government may, having regard to the practices and usages customary or any other relevant factors, by order notified in the Official Gazette, direct that no information or document shall be furnished or produced by a public servant in respect of such matters relating to such class of assessees or except to such authorities as may be specified in the order." (emphasis supplied) Section 138(2) of the Act as afore-extracted, is relevant for the purpose of the lis begins with a non-obstante clause reading "notwithstanding anything contained in sub-section (1) or any other law for the time being in force", no information or document s....
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....ears and I have not been found anywhere deviant in my income tax assessments. To my surprise and dismay, on March 15, 2016, when I was in Goa attending an important sports event, my body search was done by the Income Tax officials and I also came to know from various media channels that my house was searched ostensibly to detect violations of Income Tax Act on my part. I was shocked and traumatized by the search and I could not contact my wife, Smt.Hamsa Raj as my mobile phones were taken in to custody by the IT Officials. Further I was given to understand that a posse of income tax officials had entered into my house and did an extensive search of my house. Even after taking me into illegal custody at Goa; I was brought to Bangalore by IT Official from Goa, they did not provide me details of searches and of recovery, rather took me to the office of the Karnataka Olympic Association of which I am the President and took the search of the office. It is a matter of great concern that the KOA is the independent body registered under the Societies Act of Karnataka but search was done as a part of the wider conspiracy to defame and belittle me in the eyes of sports administratio....
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....en made public and used as a tool of victimisation in collusion with political opponents. In fact, my letter to the Director General (Investigations) has brought out these facts much before a national TV channel showed the contents of the diary that unauthorised persons had access to information available with Income Tax Department. It is pertinent to inform that any seized materials vide Income Tax Act is out of purview of even Right to Information Act and can have limited access to the authorities concerned and others as per the law. Such being the position of law; the availability of information which is subject matter of income tax act proceedings with unauthorised persons clearly shows that either such persons have committed theft of such information or documents from the Income Tax Department or the authorities in Income Tax Department have committed the offence of criminal breach of trust by sharing the information which ought not to have been shared to unauthorised person and media for publications with wrongful political gain. Contents of such planted diary have been vigorously used by the political opponents with ulterior motive which clearly demonstrates that it....
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.... parcel or thing in the custody of the postal or telegraph authority." In terms of Section 91 of Cr.P.C., an officer investigating into a crime is entitled to summon or compel production of a document or other thing. The notice issued against the petitioners reads as follows: "As the diary which was allegedly seized during the raid conducted on the residence of Sri K.Govindaraj, MLC of Karnataka on 15-03-2016 is very much essential to conduct further investigation in Indiranagar PS, Dr.No.52 of 2017 under Section 166A, 182, 193, 109, 199, 208, 406, 466, 409, 457, 380, 472, 471, 120(B) r/w 34 IPC. You are hereby called upon to produce the alleged diary, in original, which was seized during the raid conducted on the residence of Sri K.Govindaraj, MLC on 15-03-2016 and indexed by you vide reference No.(2) as "A/KG/03" before the undersigned at Indiranagar Police on or before 20th April, 2017 at 11.00 a.m. Further you are hereby also called upon to furnish the details of the officers, persons and officials who were present during the raid conducted on the residence of Sri K.Govindaraj, MLC on 15-03-2016." A perusal at the notice would clearly indicate that what the Polic....
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....ing of FIR against the petitioners, who are officers of Government and have performed certain acts of search and seizure under Section 132 of the Act, cannot be brought to prosecution particularly, for the offences alleged in the FIR. The complaint ought not to have been entertained by the 3rd respondent/Police and registration of FIR ought not to have been done in the light of the aforesaid provisions of the Act. 17. It is rather shocking that what the complainant wants in the complaint is, the diary and what the Police want to secure from the petitioners is the diary and no other document is required by the Police for investigation of the allegations of offences, which run into 15 in number, but only the diary. It cannot but be held that the 3rd respondent was acting at the behest of the complainant to secure the diary by invoking Section 91 of the Cr.P.C., thereby summoning the diary. Since the FIR could not have been registered against the petitioners in view of the specific bar under Section 293 of the Act, the aftermath of such registration would be rendered without authority of law. 18. The submission of the learned senior counsel appearing for the second respondent / ....
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.... "293. Bar of suits in civil courts.--No suit shall be brought in any civil court to set aside or modify any proceeding taken or (1998) 3 SCC 481 order made under this Act, and no prosecution, suit or other proceeding shall lie against the Government or any officer of the Government for anything in good faith done or intended to be done under this Act." ... .... .... 17. We have seen above that the scope of Section 293 of the Act has been widened now even to include any proceeding under the Act and it is not confined merely to set aside or modify any order. Form of the suit is not relevant. It is the substance which is to be seen. When the statute prescribed certain procedure and proceedings thereunder are held and order passed, it is difficult to accept a contention that that proceeding and order can be modified or set aside in a civil suit filed by a third party. Section 293 is specific and does not admit filing of a suit which has the effect of even indirectly setting aside or modifying any proceeding taken under the Act or order made thereunder. In the present case, search and seizure were effected as per the provisions of the Act, assets and documents seiz....