TMI Blog1975 (10) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... ection or the Commissioner, in consequence of information in his possession, has reason to believe that-- (a) any person to whom a summons under sub-section (1) of section 37 of the Indian Income-tax Act, 1922 (11 of 1922), or under sub-section, (1) of section 131 of this Act, or a notice under sub-section (4) of section 22 of the Indian Income-tax Act, 1922, or under sub-section (1) of section 142 of this Act was issued to produce, or cause to be produced, any books of account or other documents has omitted or failed to produce, or cause to be produced, such books of account or other documents as required by such summons or notice, or (b) any person to whom a summons or notice as aforesaid has been or might be issued will not, or would not, produce or cause to be produced, any books of account, or other documents which will be useful for, or relevant to, any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act, or (c) any person is in possession of any money, bullion, jewellery or other valuable article or thing and such money, bullion, jewellery or other valuable article or thing represents either wholly or partly income or property which has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosed income (including the income from the undisclosed property) in a summary manner to the best of his judgment on the basis of such materials as are available with him ; (ii) calculating the amount of tax on the income so estimated in accordance with the provisions of the Indian Income-tax Act, 1922 (11 of 1922), or this Act ; (iii) specifying the amount that will be required to satisfy any existing liability under this Act and any one or more of the Acts specified in clause (a) of sub-section (1) of section 230A in respect of which such person is in default or is deemed to be in default, and retain in his custody such assets or part thereof as are in his opinion sufficient to satisfy the aggregate of the amounts referred to in clauses (ii) and (iii) and forthwith release the remaining portion, if any, of the assets to the person from whose custody they were seized : Provided that if, after taking into account the materials available with him the Income-tax Officer is of the view that it is not possible to ascertain to which particular previous year or years such income or any part thereof relates, he may calculate the tax on such income or part, as the case may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Indian Income-tax Act could be passed in the light of the provisions in that section. This is because under section 132(1)(c) the search is in respect of the money of which a person is in possession and which money either wholly or partly represents income or property which had not been disclosed for the purpose of the Income-tax Act and the order under section 132(3) could also only be issued only in respect of such money on the ground that it is not practicable to seize the same. Therefore, I do not find any way to sustain the legality of exhibit P-1 order in the three cases." To state the necessary facts, we have to mention that the 1st respondent in Writ Appeal No. 291 of 1975, his wife, the 1st respondent in Writ Appeal No. 292 of 1975, and his son, the 1st respondent in Writ Appeal No. 293 of 1975, were carrying on the business of motor transport. They have accounts with the 2nd respondent in each of these appeals, the Federal Bank, Punalur. The Commissioner, in consequence of information received, recorded that he has reason to believe that the 1st respondent in Writ Appeal No. 291 of 1975 was in possession of money which represented wholly or partly income which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ossession of money leaving out the various other items mentioned in the section : bullion, jewellery or other valuable article or thing with which we are not concerned in these cases which represented income which had not been disclosed for the purpose of the Indian Income-tax Act. Proceedings under the section will have to be taken against the person so believed to be in possession of such money and it is such money that could be seized. The further action that can be taken under sub-section (3) must also be, therefore, in relation to such money and not to some other money which though it originally belonged to the person liable to be taxed had become the property of some other person and is in his complete control and custody. We shall consider these aspects. Action under sub-section (3) of section 132 can be taken only " where it is not practicable to seize any such books of account, other document, money, bullion, jewellery or other valuable article or thing ". On the facts of the case we think there is nothing arbitrary or even strange in having come to the conclusion that the monies deposited in the bank of the 2nd respondent in these appeals by the 1st respondent in each ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on is whether by the mere fact that the order was directed against the bank, the 1st respondent in each of these appeals, we should set aside the orders under article 226 of the Constitution. We do not think that in substance they are aggrieved by the order merely because of its bad form more than they would have been aggrieved had the order been issued against them. We may add that any order issued to the 1st respondent in each of these appeals could have been communicated to the bank as well and any prudent bank, we are sure, would in the light of such an order served on the customer, refuse the customer to operate on the accounts. We think that there is power to communicate the copy to the bank in view of the last part of subsection (3) of section 132 reading " and such officer may take such steps as may be necessary for ensuring compliance with this sub-section ". In the light of the above discussion, we would not be justified in setting aside the order, exhibit P-1, for we consider exhibit P-1 only to be an indirect manner of doing what could have been done directly against the 1st respondent in each of these cases. In the circumstances, we are not satisfied that we should ..... X X X X Extracts X X X X X X X X Extracts X X X X
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