TARA CHAND Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) This is a petition under articles 226 and 227 of the Constitution by Tara Chand, who appears to be working as a broker in the matter of transactions relating to second-hand cars at Amritsar. It is said that he carried out several transactions at the instance of the sons of late S. Pratap Singh Kairon, namely, Shri Surinder Singh Kairon and Shri Gurinder Singh Kairon. Their income-tax cases were being investigated by Shri Anand Prakash, Income-tax Officer, who was in charge of the Special Investigation Circle, Amritsar. It is said that during the course of the enquiries which he was making, he got into touch with the petitioner who was summoned by him. The petitioner appeared before him on 13th January, 1965, and his statement on oath was recorded. In that statement the petitioner is stated to have given details of all the transactions of which he was aware pertaining to purchase and sale of the cars by Shri Surinder Singh Kairon and Shri Gurinder Singh Kairon. the petitioner was served with a notice (annexure ) dated 24th May, 1965, by the aforesaid Income-tax Officer under section 226(3) of the Income-tax Act, 1961. It was stated therein that a sum of Rs. 2,83,752.98 was due from Shri Surinder Singh Kairon on account of income-tax and that the petitioner should not pay any amount due from him to him or held by him on his account up to the amount of arrears mentioned above. It was further stated that if the petitioner discharged any liability to the taxpayer after receipt of the notice, he would be personally liable to the Income-tax Officer to the extent of the liability discharged. On 3rd June, 1965, two statements of the petitioner were recorded by Shri Anand Prakash, Income-tax Officer, at Delhi. These statements were not recorded on oath and in one of them, which was signed by the petitioner, he purported to make an admission that a sum of Rs. 49,000 was due from him to Shri Surinder Singh Kairon. The Income-tax officer addressed a letter dated 25th August, 1965 (annexure C), to the petitioner saying that he had promised to deposit dues of Rs. 52,000, which were payable to Shri Surinder Singh Kairon, and, since he had not deposited the amount, he was called upon to show cause why attachment notice should not be issued against, him. By a letter dated 9th September, 1965 (annexure D), the petitioner expressed surprise at the contents of the letter of the Income-tax Officer dated 25th August, 1965. He further stated :

(2.) I am an illiterate person. I cannot read or write. Your goodself has been calling me in your office at Amritsar regarding certain enquiries against Shri Surinder Singh Kairon. I have been telling you whatever I knew regarding his affairs considering it my duty towards the National Government. You once called me at Delhi through Shri Surinder Singh Kairon when I was there on a private visit. You asked me to sign a piece of paper on which you had written something and I signed the paper thinking that it is again something regarding the income-tax enquiries against Shri Surinder Singh Kairon.

(3.) The Income-tax Officer sent a reply dated 15/16th September, 1965 (annexure E), pointing out that from the previous statements made by the petitioner, it stood admitted that he was liable to pay the amount to Shri Surinder Singh Kairon and, therefore, the petitioner could not be permitted to resale out of that position.