JAGADESWARIAH K Vs. PINGLE VIJAYAPAL REDDY

JUDGEMENT

(1.) THE second defendant in O. S. No. 18 of 1958 on the file of the Court of the Subordinate Judge, Warangal, is the petitioner in this case. Respondents Nos. 1 and 2 filed a suit against the defendants for recovery of about Rs. 30,000. One of the defences raised was that the respondents Nos. 1 and 2 and another, Ravva Pullaiah, constituted a partnership and that, as the partnership was not registered, the suit is not maintainable. Defendants Nos. 1 and 2 filed I. A. No. 76 of 1961 in the lower Court to summon the ITO to produce a letter dt. 24th April, 1956, written by P. Ramachandra Rao & Co., Chartered Accountants, and who represented the respondents Nos. 1 and

(2.) BEFORE the ITO, Warangal Circle, Warangal, requesting the return of the original partnership deed filed in the Department. It is stated that the said letter also bears an endorsement of the ITO that the said document might be returned and also contains an endorsement by the chartered accountants acknowledging the return of the document. The lower Court heard the counsel for the plaintiffs and defendants Nos. 1 and 2 and by its order dt. 2nd March, 1961, ordered the documents to be produced by 4th March, 1961. By that order, it expressed the view that the case was covered by S. 54, cl. (4), of the IT Act, and that, as such, the prohibition contained in cl. (1) of s. 54 of the Act did not apply. It appears from another order dt. 4th March, 1961, passed by the lower Court that the ITO expressed his readiness to produce the document if the Court directs, but wanted a month's time to get instructions from his higher authorities. But the lower Court refused further time and directed him to produce the document by 6th March, 1961. Accordingly, the document was produced by the ITO on 6th March, 1961. On that date, Sri Madhava Rao, a partner in the firm of Ramachandra Rao & Co., Chartered Accountants, was examined to prove the said letter. It appears that, while sending the document to the Court, the ITO also informed the Court that the registers in his office do not indicate the existence of any file relating to the plaintiffs Nos. 1 and 2 under S. 26A of the IT Act. Therefore, the learned counsel for the plaintiffs argued that since there was no file relating to S. 26A of the IT Act, cl. (4) of S. 54 has no application and that the document in question cannot be taken in evidence in view of S. 54, cl. (1). The lower Court held that, since there is no file under S. 26A of the IT Act relating to the plaintiffs Nos. 1 and 2, the document in question could not have been filed in a proceeding under S. 26A of the Act and that, therefore, the ITO could not be summoned to produce that document and that it could not be admitted in evidence. Against this order, the second defendant filed the above civil revision petition. Sub s. (1) of S. 54 of the IT Act is as follows :

(3.) THE question is, does this document fall under any one of the categories mentioned in S. 54, cl. (1), of the Act. It is not a statement made or return furnished or account or document produced in the course of any proceedings under the Act. It is also not any evidence given or affidavit or deposition made in the course of any proceedings under the Act and it is not any record of assessment proceeding or any proceeding relating to the recovery of a demand prepared for the purposes of the Act. It is only a letter written by the chartered accountant representing the assessee to return certain documents which were filed in connection with the assessment proceedings relating to the first plaintiff and another. It has been pointed out in S. C. Bahl vs. Megh Raj (1961) 42 ITR 308 that :