KRISHNAGOPAL Vs. DIRECTOR OF INCOME-TAX

JUDGEMENT

(1.) BY this petition, filed under Article 226 of the Constitution, the petitioner has prayed for quashing of warrant of requisition dated August 24, 2007, issued by respondent No. 1 under Section 132A of the Income -tax Act, 1961 (in short, 'the Act').

(2.) BRIEFLY stated the facts giving rise to this petition are that the petitioner belongs to Mathura (U.P.) wherein he carries on the business in the purchase and sale of raw silver, manufacture and sale of silver ornaments in the name and style of M/s. Goyal Payal Company. He is also regularly assessed to income -tax on Permanent Account No. ADWPA1767D by the Income -tax Officer, Ward 3 (2), Mathura, and registered with the Trading Tax Authorities of Uttar Pradesh on TIN No. 09427100479 09427100479 . On August 14, 2007, the police of Lordganj Police Station, during routine checking, found the petitioner in Hotel Shyam, Jabalpur (M.P.), in possession of raw silver and silver ornaments weighing 118.426 kg. and cash amounting to Rs. 3,98,450. The police, on suspicion that the silver and cash had nexus with some crime such as theft, etc., seized the same and informed the Income -tax Department of the seizure. Respondent No. 1, on receiving the information from police, issued the warrant of requisition dated August 14, 2007, under Section 132A of the Act which was served on the Town Inspector of Lordganj Police Station, sometime between August 24, 2007, and August 29, 2007. The Town Inspector could not handover the possession of assets as they were in judicial custody under the orders of the Additional Chief Judicial Magistrate, Jabalpur. The respondents, therefore, filed an application before the Magistrate requesting for possession of assets which was opposed by the petitioner. In the meantime, the petitioner moved an application dated September 3, 2007, annexure P2, before respondent No. 2 that he is a regular income -tax assessee having permanent account number and has been submitting returns before the Income -tax Officer, Ward 3 (2), Mathura, right from the assessment year 1994 -95 and enclosed the copies of returns from the assessment years 2002 -03 to 2007 -08. The petitioner, along with the application, also filed copies of stock register and cash book to establish that the seized assets were his duly accounted business assets. The police, after investigation, found that the seized assets had no nexus with any crime and, therefore, did not register any offence against the petitioner. The Magistrate, however, by order dated September 6, 2007, directed that the assets be handed over to the Income -tax Department. On these circumstances, the petitioner has filed this petition assailing the validity of the warrant of requisition issued by respondent No. 1 on the ground that the conditions precedent for the exercise of the powers under Section 132A(1) of the Act were not satisfied.

(3.) THE respondents, in their return, have stated that warrant of requisition was issued only after the conditions precedent for its issuance were satisfied and even produced the concerned record for perusal by this court to justify the action of issuance of warrant.