MOHAMMAD KUNHI Vs. MOHAMMAD KOYA

JUDGEMENT

(1.) THE question that arises for consideration in this criminal revision is, who is entitled under Section 523, Criminal Procedure Code, to the amount of cash seized from one Mohammed Koya on January 29, 1970? As Mohammed Koya arrived at the Madras Central Station at about 4.30 p.m. on that day by West Coast Express, the Inspector, Railway Police, searched him on suspicion and found on his person currency notes of the value of rupees one lakh. Suspecting him of commission of an offence cognizable by the police, the Inspector arrested him and produced him before the Second Presidency Magistrate, Madras, along with the amount seized. Mohammed Koya was remanded to custody and released on bail subsequently. THE Inspector, Railway Police, Madras Central, found on investigation that no cognizable offence has been made out against Mohammed Koya, and dropped the proceedings after intimating the income-tax department. THE income-tax department found, on investigation, that the amount of rupees one lakh represented the income of Mohammed Koya which he had failed to disclose to the income-tax department. THE Commissioner of Income-tax, Madras, Kerala and Bombay, authorised the V-Income-tax Officer, Madras, to take possession of the amount under Section 132 of the Income-tax Act, and in pursuance of this authorisation, the Income-tax Officer filed a petition before the Second Presidency Magistrate claiming to be the person entitled to the possession of the amount in court deposit and requesting the court to hand over the amount to him. On the other hand, one Mohammed Kunhi filed a petition before the court below praying for the return of the amount to him. Mohammed Koya supported the application of Mohammed Kunhi on the ground that the amount seized by the police from him did not represent the monies belonging to him, and that the monies really belonged to Mohammed Kunhi, who as the managing partner of M/s. P. Mamunchi C. Ebrahim & Company, Nileshwar, Cannanore, had entrusted him with the amount on behalf of Kallatre Textorium, Mangalore, for being paid to the Southern India Trading Corporation Ltd., Bombay. In other words, the case of Mohammed Koya was that he was merely a carrier entrusted with the task of carrying the amount of rupees one lakh from Mangalore to Bombay for the purpose of payment of the same to the Southern India Trading Corporation on behalf of Kallatre Textorium, Mangalore. If really any monies were payable by Kallatre Textorium to the Southern India Trading Corporation, one would expect them to have sent it by means of a crossed cheque or a demand draft. THE carriage of this huge amount by Mohammed Koya over several hundreds of miles was attended with evident risks. That Mohammed Kunhi should have resorted to this hazardous method of transporting the money has naturally enough aroused the suspicion of the income-tax department. Further, Mohammed Koya claims to be only a hawker doing business in Bombay Railway Station platform, and the income-tax department is entitled to wonder if Mohammed Kunhi could have reposed confidence in this platform pedlar and entrusted him with rupees one lakh as a carrier. If in these circumstances and in consequence of information, which he says he had in his possession, the Commissioner of Income-tax authorised the Income-tax Officer to seize the amount, the authorisation cannot be attacked in this court on the ground that there is no basis for his reason to believe that the money represented either wholly or partly income which has not been disclosed by Mohammed Koya for the purposes of the Indian Income-tax Act. In fact, the income-tax department, has, after notice to Mohammed Koya, assessed him to an income-tax of Rs. 62,375 under Section 147 read with Section 143(3) of the Income-tax Act on the basis that the amount of rupees one lakh represents his undisclosed income. It has also imposed a penalty of Rs. 50,000 under Section 273(b) of the Act on the ground that the assessee had without reasonable cause failed to disclose his income. THE orders of the Income-tax Officer are under appeal, and it is open to the aggrieved party to canvass the correctness of the orders before the heirarchy of Tribunals constituted under Chapter XX of the Income-tax Act. If, ultimately, the aggrieved party succeeds, he will be entitled not only to the refund of the entire amount, but also to interest at 9 per cent, per annum on the amount in case of delayed refund (vide Section 243 of the Income-tax Act). It is true that the powers of seizure given to the Income-tax Officer might lead to harassment of innocent citizens if unreasonably exercised. But, Parliament in its wisdom has conferred such powers after taking care to see that such powers are not exercised unless authorised by the Director of Inspection or the Commissioner of Income-tax, and that too, if either of them has reason to believe that the article or thing to be seized represents either wholly or partly income or property which has not been disclosed for the purposes of the Indian Income-tax Act.

(2.) LEARNED counsel for Mohammed Kunhi, the revision petitioner, advanced three grounds upon which he attacked the correctness of the order of the court below dismissing the petition of Mohammed Kunhi and directing payment of the amount in court deposit to the income-tax department: The first ground is that inasmuch as the Income-tax Officer has not seized the amount in court deposit under Section 132 of the Income-tax Act, he cannot be regarded as a person entitled to the possession of the amount within the meaning of Section 523, Criminal Procedure Code. I am unable to agree. If the Income-tax Officer is clothed by the statute with the power to seize the amount in court deposit, he would certainly be a person entitled to possession of the amount, because seizure is the process by which possession is procured, and it would be idle to draw a distinction between a person entitled to possession and a person entitled to seize. If the court is convinced that the Income-tax Officer has the power under Section 132 of the Income-tax Act to seize the money in court deposit, it would be a wholly needless and empty ritual to ask him to wait till after the court has refunded the amount to Mohammed Koya or Mohammed Kunhi and then to allow the Income-tax Officer to seize the amount from either of them the moment it is handed over to them. In fact, it has been held by the different High Courts in India that if a property which an officer is entitled under the law to seize is in custody of a court, what the officer has to do is to move the court for handing over possession of the property for any lawful purpose, and it is the duty of the court to hand it over to the officer if it does not require it for some lawful purpose : vide Bavajee Fakkir Mohammed v. State of Kerala, AIR 1967 Ker 282, Krishnan Sukumaran v. Enforcement Officer, Cochin, , Deputy Superintendent, Customs, Preventive, West Bengal v. Sitaram Navsaria, and Enforcement Officer v. Sub-Inspector of Police, 1971 K.L.J. 2 267 Ker..

(3.) NO orders on Crl. M. Ps. NOs. 613/72 and 989/72 are necessary in view of the order passed in the main criminal revision case.