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Issues:
Seizure and retention of assets under section 132(1) of the Income-tax Act, 1961; Validity of the approval for continued retention of books of account and documents under section 132(8); Interpretation of sections 131(3), 132(8), 132(10), and 132(12) in the context of asset retention; Communication and validity of orders for retention; Delay in filing the writ petition; Direction for return of seized assets. Analysis: The judgment pertains to the seizure and retention of assets by the Income-tax Department following a search under section 132(1) of the Income-tax Act, 1961. The petitioner sought the return of the seized assets after 180 days had passed since the search. An order dated October 5, 1983, approved the continued retention of the assets, purportedly under section 131(3), which the petitioner contested as inapplicable. The court examined the legality of the approval for retention under section 132(8) and the necessity for communication of such orders to the concerned party. The court analyzed the provisions of sections 132(8), 132(10), and 132(12) concerning the retention of seized assets. It was noted that the retention beyond June 30, 1982, lacked a valid order and communication, rendering it invalid. The judgment emphasized the requirement for reasons to be recorded, approved by the Commissioner, and communicated to the assessee for the retention to be lawful, citing relevant precedents to support this interpretation. Regarding the delay in filing the writ petition, the court deemed it irrelevant given the continued retention of the assets by the Income-tax Department. The judgment concluded that the retention of the assets post-October 5, 1983, under section 131(3) was invalid due to the prior invalidity of the retention beyond June 30, 1982. The court directed the return of the seized books and documents to the petitioner by December 12, 1984, declining to impose conditions on their future use by the Department. In summary, the judgment underscores the procedural requirements and limitations on the retention of seized assets under the Income-tax Act, emphasizing the importance of valid orders, communication, and adherence to statutory provisions. It upholds the petitioner's plea for the return of the assets and awards costs for the writ petition to the petitioner.
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