GODREJ V PATEL Vs. UNION OF INDIA

JUDGEMENT

(1.) HEARD parties on interim relief. Perused rival affidavits -in -reply including rejoinder and supplementary affidavits. 1. This petition is at the instance of two petitioners who are the joint depositors of respondent No. 4 bank, viz., Development Credit Bank Ltd., Mumbai. The petitioners had jointly deposited a sum of Rs. 3,00,000 in fixed deposit with respondent No. 4 in RIC scheme. In lieu thereof, they were holding FDR No. 019464 issued on 26th July, 1979. After the maturity of the said fixed deposit, it blossomed to Rs. 4,10,786 which was again renewed on 18th Nov., 1996, for a period of 12 months under fixed deposit receipt No. 01946 issued on 26th Nov., 1996. Some time in the month of February, 1997, the petitioners approached respondent No. 4 for premature withdrawal of the above fixed deposit. Respondent No. 4 declined to encash or liquidate the said fixed deposit and refused to pay the proceeds thereof to the petitioners on the ground that the amount has been seized by the IT authorities/Department. Respondent No. 4 -bank, however, confirmed the fixed deposit and value thereof in the sum of Rs. 4,26,131.29. It appears from the rival affidavits that during the course of search and seizure operations initiated by the IT authorities under S. 132 of the IT Act, a number of fixed deposit receipts were seized by the IT authorities and during the course of the assessment proceedings, respondent No. 4 -bank was called upon to prove and/or to establish the genuineness thereof. It appears that during the pendency of the assessment proceedings, respondent No. 4 -bank had called upon the petitioners to furnish their credentials, which the petitioners claimed to have furnished well within time. Learned counsel for respondent No. 4 also made a statement before us that all the details furnished by the petitioners were furnished to the AO with respect to the fixed deposits involved in this petition.

(2.) HOWEVER , learned counsel appearing for the IT Department disputed this statement made on behalf of respondent No. 4 -bank and has made a statement before us that respondent No. 4 -bank did not furnish details of the fixed deposit involved in this petition, therefore, the fixed deposit, which is the subject -matter of the present petition, has been assessed in the hands of respondent No. 4 - bank as their income and appeal challenging the said order of the AO is pending before the CIT(A), Mumbai, for final adjudication.

(3.) WE , considering the pendency of the appeal before respondent No. 5, do not propose to express our opinion so far as the merits of the order of the AO is concerned. Having heard the parties and having seen the material facts and particulars placed before us we are satisfied that the direction needs to be issued to respondent No. 5 to examine and scrutinise the genuineness of the FDR, alleged to be belonging to the petitioners. If respondent No. 5 is satisfied that the petitioners are the persons holding FDR and entitled to the said amount, then respondent No. 5 is directed to pass suitable order, pending appeal with respect to the said FDR if the same is found to be payable to the petitioners and shall direct release of the amount of the FDR to respondent No. 4 bank for being paid to the petitioners. All this process must be completed by respondent No. 5 within eight weeks from today. We direct the IT Department through respondent Nos. 1 and 2 to refund of this amount to respondent No. 4 bank within two weeks from the date of the above order. Respondent No. 4 bank shall in turn after receipt of the amount make the payment to the petitioners within one week from the date of receipt of the amount with accrued interest. The payment to the petitioners, if any, shall be subject to the result of this petition. Order accordingly.