TMI Blog2009 (1) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... ation) issued a warrant of authorization in Form 45 under Section 132 of the Income Tax Act, 1961 (hereinafter referred to as the said Act') and Rule 112 (2) (a) of the Income Tax Rules, 1962 (hereinafter referred to as the 'said Rules') to, inter alia, the Additional Director of Income Tax (Investigation) (Mr A. K. Singh) as also to Assistant Directors of Income Tax (Investigation) [Mr L. K. Aggarwal, Mr Ajay, Mr Anil Kumar, Mr S. Bose, Mr K. C. Badhang, Mr P. K. Mishra (DCIT) and Mr Rajiv Kumar]. This warrant of authorization was issued on 25.05.2000 and was in respect of the premises at B-256, Suraj Mal Vihar, Delhi-92. A panchnama was drawn upon on 25.05.2000 itself and a restraint order under Section 132 (3) of the said Act in respect of locker No. 11-PNB, Preet Vihar, Delhi under the names of Sh. P. K. Garg and Smt. Shashi Garg was also served on Mr P. K. Garg. 3. Thereafter, a second warrant of authorization in Form 45 under Section 132 of the said Act read with Rule 112 (2)(a) of the said rules was issued on 25.05.2000 by Mr A. K. Singh, Additional Director of Income Tax (Investigation) authorizing some Deputy Directors of Income Tax, Assistant Directors of Income Tax a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as happened is that the second warrant of authorization in respect of the said locker was issued by the Additional Director Income Tax (Investigation). The Additional Director does not find mention in the provisions of Section 132(1). However, it was contended by the learned counsel for the revenue that the Additional Director would be covered in the expression Joint Director in view of the provisions of Section 2 (28D) of the said Act. Even assuming that the expression Joint Director as used in Section 132(1) includes an Additional Director, such Additional Director or Joint Director would have to have initial empowerment by the Board to issue warrants of authorization in view of the provisions of Section 132(1)(B). This, of course, is de hors the argument that the definition given in Section 2(28D) has to be read in the light of the opening words of Section 2 which clearly stipulates that the definitions given in that provision are subject to the expression unless the context otherwise requires. 7. The learned counsel for the revenue also contended that there was authority granted to the Additional Director of Income-tax by the Board to issue warrants of authorisation of sear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n continued till 1965 when, by virtue of the amendments brought about in 1965, the Director of Inspection, alongwith the Commissioner, was empowered to take action under Section 132 of the said Act. By the amendment introduced in 1975, an additional class or category of persons was created in Section 132(1). That class or category included Deputy Directors of Inspection and Inspecting Assistant Commissioners. While the persons belonging to the original category, i.e., of Director of Inspection or Commissioner of Income-tax were empowered by the statute itself to authorise any action under Section 132 of the said Act, the persons falling in the second category, i.e., Deputy Directors of Inspection and Inspecting Assistant Commissioners had to be specifically empowered by the Board to issue warrants of authorisation of search and seizure operations under Section 132 of the said Act. After the 1975 amendment, even Deputy Directors of Inspection and Inspecting Assistant Commissioners could initiate action under Section 132 provided they were specifically empowered to do so by the Board. It is pursuant to this amendment in 1975 that the Board issued the notification dated 06.11.1979 emp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a notification dated 23.10.1998 issued by the Central Government under Section 117(1) of the said Act. The said notification merely re-designated certain officers of the Indian Revenue Service w.e.f. 01.10.1998. The re-designation, inter alia, entailed that Deputy Directors of Income-tax and Deputy Commissioners of Income-tax in the pay scale of Rs 12,000-375-16,500/- would be re-designated as Joint Director or Income-tax and Joint Commissioner of Income-tax in the pay scale of Rs 12,000-375-16,500/-. The learned counsel for the revenue contended that the empowerment as per notification dated 11.10.1990, would automatically apply, in view of the above re-designation, to Joint Directors of Income-tax as also Joint Commissioners of Income-tax. This argument does not advance the case of the revenue. First of all, the officer who issued the warrant of authorisation on 25.05.2000 was not a Joint Director of Income-tax, but was the Additional Director of Income-tax (Investigation). Secondly, the notification that was necessary in the present case, was a notification by the Board in exercise of powers under Section 132(1) of the said Act. There is no such notification authorizing any Join ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s concluded. The issue before the Supreme Court, however, is open. The Supreme Court has not expressed any opinion either way in its said judgment dated 30.09.2008. 14. With these prefatory remarks in respect of the Division Bench decision of this court in Dr Nalini Mahajan (supra), it would be appropriate to now examine what was actually held in that decision. One of the issues raised was whether the Additional Director (Investigation) had the requisite jurisdiction to authorize any officer to effect search and seizure in purported exercise of the power conferred upon him under Section 132 of the said Act. The Division Bench concluded that the Additional Commissioner (Investigation) did not have the power to issue any authorisation or warrant to the Joint Director, New Delhi. While doing so, the Division Bench considered, inter alia, the provisions of Section 2(21) which defined Director General and Director; Section 2(28D) which defined Joint Director and Section 132(1) of the said Act. The definition of Director General or Director given in Section 2(21) after the amendment of 01.10.1998 indicated that the Director General or Director meant a person appointed to be a Directo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IR 1936 PC 253; Viteralli v. Saton: 3 Law Ed. 1012 and Ramana Dayaram Shetty v. International Airport Authority of India: 1979 (3) SCC 489, that when a power is given to do a certain thing in a certain manner, the same must be done in that manner or not at all and that all other proceedings are necessarily forbidden. In this context, the Division Bench found that the Additional Director (Investigation) had no jurisdiction to issue a warrant of authorisation and consequently, the same was liable to be quashed. 16. We may also note that in CIT v. Jainson: ITA 366/2007 decided on 17.07.2008, we had endorsed and respectfully followed the view taken by this court in Dr Nalini Mahajan (supra). The main question sought to be raised in CIT v. Jainson (supra) was with regard to the power of the Additional Director of Income-tax (Investigation) to issue a warrant under Section 132(1) of the said Act. The tribunal in that case had found that the warrant of authorisation by the Additional Director of Income-tax (Investigation) was without authority and, therefore, the entire search as well as the assessment proceedings subsequent upon such warrant were invalid and bad in law. The tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion in Sunil Dua (supra) is clearly distinguishable. 18. It had been argued by the learned counsel for the revenue that as per Section 2(28D), the Joint Director meant a person appointed to be a Joint Director of Income-tax or an Additional Director of Income-tax under Section 117(1) of the said Act. It was, therefore, contended that since the warrant of authorisation in the present case had been issued by an Additional Director of Income-tax, it meant that it was issued by a Joint Director of Income-tax and, therefore, the warrant of authorisation was valid. This argument cannot be accepted. As held in Dr Nalini Mahajan (supra), the definition of Joint Director has to be read contextually. The provisions of Section 132(1) refers to Director General or Director as well as Joint Director or Joint Commissioner. While the first two authorities fall within the first category, which were empowered by the statute itself to authorize action under Section 132(1), the latter two authorities, namely, the Joint Director or Joint Commissioner, can only authorize action if they are specifically empowered by the Board in that behalf. Now, the definition of Director General or Director as giv ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
