CHIRNAJILAL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) : On 13th March, 1974, the present writ petition was filed under Arts. 226 and 227 of the Constitution of India to challenge the legality and validity of searches and seizures effected under s. 132 of the IT Act, 1961, at premises belonging to the petitioners who are father and son. According to the petition as originally filed, two warrants of authorisation were issued by the CIT/Director of Inspection to carry out simultaneous searches at the office and residential premises of the petitioners. These warrants were shown to the petitioners at their place of residence at 57, Jor Bagh, New Delhi. Searches and seizures were effected at Akash Deep Building, Ansal Bhawan, 16, Kasturba Gandhi Marg and Uphar Cinema at Green Park Market. In searches at 57, Jor Bagh, on 18th Dec., 1973, which continued up to 10.00 p.m. currency notes valued at more than Rs. 1,00,000, silver utensils worth Rs. 2,800 and jewellery of more than Rs. 42,000 belonging to Shrimati Suraj Kumari, wife of the first petitioner and jewellery worth over Rs. 24,000 belonging to Shrimati Kusum Ansal, wife of the second petitioner, and documents, account books, share certificates and other documents were seized and inventories prepared. Some of these articles were later returned. According to the petitioners, they had given full information regarding all these items and none of them represented concealed income. It is claimed that the searches were ultra vires and infringed s. 132(1) of the IT Act, 1961. Various notices were served on the petitioners being Annexure "IV" dt. 31st Dec., 1973, and Annexure "VI" dt. 2nd March, 1974, and it was claimed that these notices were ultra vires as a summary order had to be passed latest by the 90th day after the search which fell on 19th March, 1974. In any event, a summary order was passed, so the petition was amended only a few days after it was filed. The said order is dt. 17th March, 1974, and the same has also been challenged by the amendment.

(2.) NO return was filed to the writ petition in spite of the same having been pending in this Court since 1974. When this matter came up for hearing before us on 9th April, 1980, we directed that a return must be filed and consequent to this order, the affidavit of Shri S. K. Sharma, ITO, Central Circle, has been filed. At the same time, the Department has placed before us the original satisfaction file for verifying certain facts which are necessary for issuing an order under s. 132 of the Act. We have examined the said file, particularly as in this case due to the passage of time the CIT who had authorised the searches and seizures is no longer holding the said office and we have not had the advantage of examining his affidavit. In all other reported cases of a similar type where the warrant of authorisation has been impugned, the relevant affidavit has come from the concerned official. Nevertheless, in spite of the affidavit being by an ITO who was not concerned with the actual searches and seizures, we have examined the correct position in order to determine the validity of the searches and seizures.