TMI Blog2000 (2) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... n 133A of the Income-tax Act, 1961 (for short, "the Act"), at the business premises of the petitioner on December 21, 1999, and a list of documents was prepared. On the same date, i.e., on December 21, 1999, summons under section 131 of the Act was issued to the director of the petitioner-company to produce the books of account and other documents for verification of the entries on December 22, 1999. In pursuance of the summons issued under section 131(1) of the Act, the director of the petitioner-company appeared along with the books of account and other documents on December 22, 1999, and the same had been impounded by the authority on the said date. Hence, this petition. Heard Mr. Anjay Kothari, learned counsel for the petitioner, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he rival submissions made by learned counsel for the parties. Section 133A of the Act empowers the authority to conduct the survey. Sub-section (4) of the said section provides that the income-tax authority acting under the provisions of the said section "shall, on no account, remove or cause to be removed from the place wherein he has entered, any books of account or other documents or any cash, stock or other valuable article and thing." Thus, the said sub-section (4) of the said section puts an embargo on the powers of the authority to remove or cause to be removed from the place where he has entered, the books of account and other documents, etc. Sub-section (6) of section 133A reads as under: "If a person under this section is re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther documents cannot be retained for a period of more than fifteen days unless there is prior sanction by the authority mentioned therein. In view of the above, it is quite clear that the income-tax authority cannot impound the books of account or other documents in the proceedings of conducting the survey and the impounding is permissible only under sub-section (3) of section 131. Thus, the instant case is to be examined in the light of the aforesaid statutory provisions. Mr. Kothari has placed reliance upon a large number of judgments of various High Courts urging that what is not permissible to be done directly, cannot be done indirectly and under the garb of the powers conferred under section 131(3), the authority have malafide exe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d (c) compelling the production of books of account and other documents..., are also conferred on the income-tax authority while carrying out a survey, if the persons connected with the business or profession present at the time of survey, refuse or evade complying with the requisitions made in respect of the matters referred to in section 133A(1). The contents of section 131(1) are incorporated into section 133A(6) by reference. By such incorporation, the other sub-sections of section 131 are not engrafted into section 133A(6). Parliament has taken particular care to avoid any reference to section 131(3) which empowers the authority before whom books of account are produced to impound the same, in view of the express and emphatic bar impos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the power under section 133A was not empowered to impound documents during the course of survey. In Sri Venkateshwara Tourist Home (P.) Ltd. v. Assistant Director of Income-tax (Investigation), [1998] 233 ITR 736, the Karnataka High Court, after considering a large number of judgments, held as under: "The contention which has been raised by the petitioner appears to be correct that without following the procedure provided under section 133A, the respondent was in a mood to impound the documents and for that purpose, list was prepared at the spot and the formalities under section 131 were just shown to have been done. The action of the authorities cannot be considered as justified in accordance with the provisions of law." A similar v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rued as to defeat all attempts to do, or avoid doing, in an indirect or circuitous manner that which it has prohibited or enjoined'." Law prohibits to do something indirectly which is prohibited to be done directly. More so, the powers even under section 131(1) can be resorted to in all cases where the assessee refuses or evades the answer of the querries or recording of his statement and does not co-operate with the survey. The impugned order dated December 22, 1999 (annexure 2), does not disclose anywhere that the petitioner-assessee or any of its employees, legal representatives or directors has either refused or evaded to furnish an information, therefore, the question of resorting to the provisions of section 131(1) was unwarranted ..... X X X X Extracts X X X X X X X X Extracts X X X X
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