TMI Blog2016 (1) TMI 811X X X X Extracts X X X X X X X X Extracts X X X X ..... .04.2014, came to be decided only on 20.07.2015 i.e. over one year later. In the meantime, the petitioner had sent two reminders. Action of the Assessing Officer cannot be countenanced. Impugned order dated 20.07.2015 is set aside. The seized cash shall be released in favour of the petitioner alongwith interest as per the statute. - Special Civil Application No. 13374 of 2015 - - - Dated:- 11-1-2016 - Akil Kureshi And Mohinder Pal, JJ. For the Appellant : Mr RK Patel with Mr B D Karia with Mr Darshan R Patel, Adv For the Respondent : Mr Pranav G Desai, Adv JUDGMENT ( Per : Honourable Mr. Justice Akil Kureshi ) 1. Heard learned counsel for the parties for final disposal of the petition. The petitioner has challenged an order dated 20.07.2015 as at Annexure N to the petition in following factual background. 2. The petitioner, on 24.03.2014, was travelling from Morbi to Rajkot carrying cash of ₹ 20,07,000/-. According to him, he had to handover such cash to his friend Manoj P. Rajdev. The vehicle, in which, the petitioner was travelling, was intercepted by the police authorities being the election period for general election to the parliament. The pol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner was able to satisfy the source of the asset. 4. Relevant facts may be re-stated. On 25.03.2014, the Income Tax department seized the cash which was found by the police authority on 24.03.2014 in the hands of the petitioner. The petitioner applied for release of such cash under petition dated 14.04.2014 which was filed on 17.04.2014. Despite reminders, such application came to be decided by the respondent only on 20.07.2015. 5. In this context, we may peruse the statutory provisions. Section 132B of the Act pertains to application of seized or requisitioned assets and reads as under: [Application of seized or requisitioned assets: 132B. (1) The assets seized under section 132 or requisitioned under section 132A may be dealt with in the following manner, namely:- (i) the amount of any existing liability under this Act, the Wealth-tax Act, 1957 (27 of 1957), the Expenditure-tax Act, 1987 (35 of 1987), the Gift-tax Act, 1958 (18 of 1958) and the Interest-tax Act, 1974 (45 of 1974), and the amount of the liability determined on completion of the assessment [under section 153A and the assessment of the year relevant to the previous year in which search is initiated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ets and such sale shall be effected in the manner laid down in the Third Schedule. (2) Nothing contained in sub-section (1) shall preclude the recovery of the amount of liabilities aforesaid by any other mode laid down in this Act. (3) Any assets or proceeds thereof which remain after the liabilities referred to in clause (i) of sub-section (1) are discharged shall be forthwith made over or paid to the persons from whose custody the assets were seized. (4) (a) The Central Government shall pay simple interest at the rate of [one-half per cent for every month or part of a month] on the amount by which the aggregate amount of money seized under section 132 or requisitioned under section 132A, as reduced by the amount of money, if any, released under the first proviso to clause (i) of sub-section (1), and of the proceeds, if any, of the assets sold towards the discharge of the existing liability referred to in clause (i) of sub-section (1), exceeds the aggregate of the amount required to meet the liabilities referred to in clause (i) of sub-section (1) of this section. (b) Such interest shall run from the date immediately following the expiry of the period of one hu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k assessment proceedings. Such liabilities would not only include the principal tax but also interest and penalties, if any. However, under the first proviso to Clause (i) of sub section (1), if the person concerned makes an application within the prescribed time and also satisfies the Assessing Officer about the source of acquisition of such asset, the asset would be adjustable only against the existing liabilities. In other words, upon the concerned person applying to the Assessing Officer and satisfying him about the source of the acquisition of the asset, the same would be released after adjustment towards existing liabilities, without waiting for the outcome of the assessment proceedings under Section 153A of the Act or the assessment for the year relevant to the previous year, in which, the search was initiated or a requisition is made or for the block period referred to under Chapter XIV-B. 8. Further proviso to Clause (i) of sub section (1) of Section 132B of the Act provides that such asset or any portion thereof, as is referred to in the first proviso shall be released within a period of 120 days from the date on which the last of the authorizations for search under Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the seized assets and books of accounts was decided after expiry of 120 days from the last of the authorizations. Division Bench of this Court held and observed as under: 18. Having heard the learned advocates appearing for the parties and having considered their rival submissions in light of the statutory provisions and facts and circumstances of the case, the Court is of the view that the impugned order passed by the respondent rejecting the petitioner's application for release of jewellary and gold ornaments is not tenable at law and hence the same deserves to be quashed and set aside. The provisions contained in Section-132B(1) are very clear and unambiguous. Section-132B deals with the assets seized under Section- 132 or recognized under Section-132A of the Act. A detailed procedure is prescribed under Section-132B(1)(i) of the Act. Out of such seized assets, the amount of the existing liability or the amount of the liability determined on the completion of the regular assessment or reassessment including any penalty levied or interest payable in connection with such assessment or reassessment is required to be recovered. The first proviso of this Section enables ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 120 days. It is only after the expiry of the said period the order was passed raising all sorts of contentions. However, this is not permissible in view of the mandate contained in second proviso to Section-132B(1)(i) of the Act. It clearly says that the assets or any portion thereof shall have to be released within a period of 120 days. Once this period is over the respondents have no authority to retain these assets. Interpreting somewhat similar provisions, this Court has already taken the view in Cowasjee Nusserwanji Dinshaw (Supra) wherein the books of accounts were retained beyond the period of 180 days from the date of seizure without communicating the reasons recorded by the authorised officer and approval of the Commissioner was held to be illegal and unlawful. The ratio of the said decision would squarely cover the present case and in all these cases the respondent authorities have retained the seized assets beyond the period of 120 days. The orders passed by the respondent authorities beyond such period are of no consequence and they are not tenable at law. 20. In the above view of the matter, all these orders which are challenged in the present group of petitions ..... X X X X Extracts X X X X X X X X Extracts X X X X
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