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2019 (6) TMI 101 - HC - Income TaxSeizure of cash carried out by the Flying Squad - cash seized in an exercise conducted under the guidelines of the Election Commission of India - Seeking release the seized cash which was deposited in the District Treasury at Muzaffarpur but has since been transfered to the Income Tax Department - HELD THAT:- In view of the conclusion drawn by the three-men Committee constituted under the guidelines of the Election Commission of India, a copy of which is enclosed at Annexure A/9 to the counter affidavit of the Election Commission of India, in accepting the error committed in the seizure of the cash in question and concluding that the seized money had no connection with the Elections which conclusion is accompanied with the recommendation for release of cash by the Income Tax Department, any attempt made by Ms. Sinha to justify either the requisitioning of the cash in question by respondent no.6 vide his letter dated 4.4.2019 at Annexure F/9 or in taking recourse to the provisions of Section 132 or to hold on to the money is absolutely without jurisdiction and without sanction of law because the guidelines nowhere empowers either the Income Tax Department to requisition the cash seized in an exercise conducted under the guidelines of the Election Commission of India nor does guidelines provide that any cash seized in the process is to be deposited with the Income Tax Department. The seizure itself was without sanction of law and which is apparent from the fact that no F.I.R. or complaint was instituted as provided under Clause 4 of the Guidelines nor the case was submitted to the court of competent jurisdiction within 24 hours nor the Committee so constituted under the Guidelines took any decision to order seizure of the cash, in absence of any F.I.R./ complaint instituted in terms of Clause 16(i). The illegality is perpetuated because the guidelines do not empower the authorities connected with conduct of the Elections to transfer money deposited in the Treasury to the Income Tax Department on their dictates. The action of the District Treasury Officer, Muzaffarpur in succumbing to the dictates of the Income Tax Department to transfer the seized cash vide Annexure 5 to the writ petition on 11.4.2019 is dehors the guidelines and even the requisition made by respondent no.6 through his letter dated 4.4.2019 addressed to the District Magistrate, Muzaffarpur at Annexure F/9 vide order dated 11.4.2019 at Annexure 5 is wholly illegal and without sanction of law. What we find surprising is that even when the Committee constituted has accepted vide Annexure J/9 that the seizure was wrong, the Income Tax Department has proceeded to exercise jurisdiction over the cash seized as if the seizure made by the Flying Squad under the guidelines of the Election Commission of India was in fact in furtherance of exercise under section 132 of the Income Tax Act and the Flying Squad was acting as their agency. That the Committee vide its order dated 13.5.2019 has ordered for release of cash with the recommendation to the Income Tax Department to take consequential action, we hereby direct respondents no. 6 to 8 or the authority found responsible more particularly respondent no.6 under whose requisitional order the money was transferred to the Income Tax Department to forthwith take steps for release of the cash in favour of the proprietor of the petitioner within a maximum period of eight weeks of receipt/ production of a copy of this judgment, failing which the petitioner would be entitled to interest @ 10% on the seized cash payable by the Income Tax Department from the date the seizure took place i.e. 27.3.2019 until the money is refunded by the Income Tax Department. Be it noted that we have expressed no opinion on the exercise initiated by the Income Tax Department in purported exercise under section 131 and 132A of ‘the Act’ and they are at liberty to take it to its logical conclusion.
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