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2020 (12) TMI 186 - HC - Income TaxValid search - proceedings initiated under Section 132 - whether satisfaction does record reasons calling for necessary authorization to carry out search and seizure - sufficiency and adequacy of the reasons recorded in the note of satisfaction in terms of Section 132 - HELD THAT:- Search and seizure proceedings, place considerable power in the hands of the Revenue Department. Hence it becomes essential that a consistent system of checks and balances be maintained against it. This power empowers the Revenue Department to bypass the privacy of an assessee or any individual, whom the Revenue has a 'reason to believe,' would hold some information regarding tax evasion activities. The search and seizure procedure requires the authority to apply their mind and pay heed to all relevant facts while concluding that a warrant of authorization must be issued. The authority, ought to record their reasons in reaching the conclusion that such proceedings ought to be initiated against the assessee. The jurisdiction of this Court merely extends to keeping a check on the relevance of the reasons recorded and not go beyond in assessing the sufficiency or adequacy of the reasons provided. The Satisfaction Note was clearly concerned with tax evasion activities conducted by various companies and persons mentioned therein and the same has been relied upon by the authority to initiate the proceedings under Section 132. Further it must be kept in mind that the Court cannot substitute its own opinion in this regard. Petitioner's assertion of having resigned from the Company and nothing to do with the same, cannot be accepted as a disputed fact in writ jurisdiction, more so when records of the Registrar of Companies reflected the position to be otherwise. In any event, whether Petitioner, any which way was connected with the Company or not; or the documents reflecting huge amounts of cash transactions stood reflected in the books of accounts and was not an undisclosed income is again a question of fact which can be easily taken before the authorities in the adjudicatory proceedings. The same was allowed to be completed by this Court by way of the interim order dated 21st of April, 2010 with the only restraint of not passing a final order. The impugned action is neither malafide nor arbitrary or capricious. Note of satisfaction does record reasons calling for necessary authorization to carry out search and seizure operation. The search and seizure operations carried out by and in terms of Section 132(1) of the Income Tax Act cannot be said to be illegal and ultra vires the Statute.
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