PARAS RICE MILLS Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) IN these petitions filed under Art. 226 of the Constitution of India, the petitioners have prayed for quashing of the notices issued by the Asstt CIT (Investigation Circle II), Ambala, under S. 226(3) of the IT Act, 1961 (for short "the Act"), for attachment of other accounts. They have also prayed for quashing of the orders passed by the Dy. CIT (Investigation Circle II), Ambala, declining the request made on their behalf to withdraw the attachment. Another prayer made by the petitioners is for quashing the approval granted by the CIT under S. 132(8) of the Act for continuing the seizure of their books of account and documents. The facts :

(2.) DURING the course of search and seizure operation conducted on the business and residential premises of the petitioners on 26th Sept., 1995, the officers of the IT Department seized the books of account and documents. This was followed by attachment of their bank accounts. After about one year, the AO passed an order of assessment dt. 27th Sept., 1996, and created a demand of Rs. 85 lakhs. The applications filed by the petitioners for stay of the recovery were dismissed by the Asstt. CIT, the Dy. CIT, Ambala Range, Ambala, and the CIT, Rohtak. However, by an order dt. 29th May, 1998, the Tribunal accepted their applications and stayed the recovery subject to certain conditions. The relevant extract of that order is reproduced below :

(3.) THE respondents have controverted the averments made in para 10 of the writ petition by making the following statements :