SUBODHCHANDRA AND COMPANY Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) RULE returnable on 23rd Jan., 1995. Before any interim relief could be granted, the learned counsel appearing for the parties have argued the matter at length on the question of jurisdiction. On the question of interim relief it has been submitted by the learned counsel for the petitioner that the petitioner would suffer irreparable loss in the international market if, pending hearing and disposal of this petition , the gold ornaments seized by the respondents are not released. He submitted that the purpose of seizure and inquiry would at the most, be to find out whether the ornaments were purchased from any undisclosed income, and if it is held that the same were purchased from undisclosed income, then the value of the said ornaments is required to be included in the income, and the assessee is required to be taxed as provided under S. 132(5) of the IT Act, 1961. He, therefore, submitted that in the interest of justice, and to see that the petitioner does not suffer huge loss, the gold ornaments may be released after taking appropriate bank guarantee for the value of the gold ornaments seized.

(2.) THIS submission of the learned counsel for the petitioner was opposed by Mr. M.J. Thakore, learned counsel for respondents No. 1 to 3 by raising the contention that this Court would have no jurisdiction to entertain this petition. Hence, before discussing the contentions raised by the learned counsel for the parties, some facts of the case are required to be stated, which are as under :

(3.) IT is pointed out by the petitioner that the petitioner is exporting gold ornaments under what has come to be known as 'Replenishment Scheme' framed by Govt. of India. The petitioner is an exporter of gold ornaments of large magnitude, by getting the same manufactured through its own paid workers at different places in India, such as Rajkot, Ahmedabad, Coimbatore, Belgaum, Hyderabad, Delhi, Calcutta, Paddhari, Morvi, Bombay, etc., for manufacturing the ornaments, the petitioner firm is required to send the raw gold to different places either by post through angadia or with some employee or deputy of the manufacturer. The petitioner is keeping absolutely foolproof and exhaustive records of the receipt and delivery of raw gold and the gold ornaments, so that at any point of time, accounting of the gold received from the Government, delivery to the manufacturers, receipt back as gold ornaments, the balance remaining with the manufacturers and the balance remaining with the petitioner can be found out.