TMI Blog1973 (6) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... ax Rules, 1962 (hereinafter referred to as "the rules"), was issued allowing the petitioner an opportunity to explain the nature of the possession and source of the acquisition of the currency of Rs. 59,000. After the petitioner offered his explanation, the respondent No. 3, who is also an Income-tax Officer, passed the order contemplated by section 132(5) of the Act, determining the total income of the petitioner from undisclosed source at Rs. 2,64,500. For the tax assessed on this account, the cash of Rs. 59,000 which was seized, was appropriated. Other documents and valuable things seized during the course of the search have been retained by the department. Being aggrieved with this the petitioner has now approached this court, inter alia, praying for a writ of mandamus or any other appropriate writ or direction or order directing the respondents to hand over to the petitioner the sum of Rs. 59,000 and fixed deposit receipts which have been attached during the course of the search. One of the prayers of the petitioner is for obtaining declaration that section 132 of the Act is ultra vires of the Constitution of India. But in view of the decision given by this court in Ramjibh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, we find that this contention is totally devoid of merits. It is undoubtedly true that the respondent No. 2 and his party first visited the residential and business premises of the petitioner on July 10, 1969, but the search, which was started by this party, was not complete on that day. On that day, books of accounts such as rojmel and khatavahi of the relevant period, some files containing vouchers and other correspondence, lease deeds, bank pass books and some fixed deposit receipts were actually seized. But the further work of the search could not be proceeded with as some of the friends and well-wishers of the petitioner created uproar and made the situation tense. These facts are clearly borne out by reference to the affidavits made by respondents Nos. 2 and 3. Respondent No. 2 states in his affidavit that pursuant to the authorisation under section 132 of the Act, he and one W. Hasan started making search of the residential and office premises of the petitioner at Nani Daman on 10th July, 1969. During the course of the search, he collected account books and other documents and made an inventory thereof. What happened thereafter is best put in the words of the deponent hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the residents of the village. It is further found by reference to exhibit A that on 11th July, 1969, an order, contemplated by section 132(3) of the Act, was passed. By this order the petitioner was requested not to remove, part with or otherwise deal with the cash and ornaments, which were noticed in the cupboard. Shri Bhatt, the learned advocate of the petitioner, contended that even though it is true that on 10th July, 1969, the respondent No. 2 could not carry out complete search of the premises, the proceedings, which he had already undertaken on that day, reveal that all the articles including cash, ornaments and other documents were seized by him and, therefore, 10th or 11th July, 1969, should be considered as the proper due dates for computing the period of 15 days, for the purpose of the notice contemplated by rule 112A of the Rules. We are unable to accept this contention for the simple reason that the facts stated by the respondents Nos. 2 and 3 in their affidavits make it very clear that the cash and ornaments noticed in the cupboard were not at all seized on 10th July, 1969. The order passed under section 132(3) of the Act found at exhibit A clearly shows that these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C does not refer to those articles but refers only to the cash amount of Rs. 59,000. According to the petitioner these fixed deposit receipts and title deeds are valuable things and articles to which the provisions of rule 112A of the Rules apply. As against this, Shri Kaji, who appeared on behalf of the department, contended that section 132 of the Act as well as rule 112A of the Rules make a clear distinction between the assets such as money, bullion, jewellery or other valuable articles and things on the one hand and mere documents on the other. So far as the assets as described above are concerned, the section as well as rule 112A provide a particular procedure but so far as the documents and books of accounts are concerned, section 132 contemplated altogether a different procedure. In this connection, he drew our attention to sub-section (8) of section 132 which says that books of accounts or other documents seized under sub-section (1) of section 132 shall not be retained by the authorised officer for a period exceeding 180 days from the date of the seizure unless the reasons for retaining the same are recorded by him in writing and approval of the Commissioner for such reten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or thing. For the purpose of considering this point, we are not concerned with sub-sections (2), (3) and (4) of section 132. But, sub-section (5) of this section authorises the Income-tax Officer concerned to estimate the undisclosed income of the assessee concerned in a summary manner to the best of his judgment, to calculate the amount of tax on the income so estimated and to specify the amount that would be required to satisfy any existing liability of the assessee under the Act. Of course, this order should be passed with the previous approval of the Commissioner and within 90 days of the seizure. Clause (iii) of sub-section (5) is material for our purpose, because it contains the directions as regards the retention of seized assets, or part thereof of the assessee, which, in the opinion of the Income-tax Officer, is sufficient to satisfy the aggregate of the amounts referred to in clauses (ii) and (iii) and to release the remaining portion, if any, of the said assets. This clause (iii) is in the following words: "(iii) specifying the amount that will be required to satisfy any existing liability under this Act and any one or more of the Acts specified in clause (a) of sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be conducted. Sub-rule (1) contemplates the issuance of the show-cause notice. It is in the following terms: "(1) Where any money, bullion, jewellery or other valuable article or thing (hereinafter referred to as assets) are seized, the Income-tax Officer shall within fifteen days of the seizure issue to the person in respect of whom enquiry under sub-section (5) of section 132 is to be made requiring him on the date to be specified therein (not being earlier than fifteen days from the date of service of such notice) either to attend at the office of the Income-tax Officer to explain or to produce or cause to be there produced evidence on which such person may rely for explaining the nature of the possession and the source of the acquisition of the assets." We are not concerned with sub-sections (2), (3) and (4) for the purpose of this discussion. It is evident from clause (e) of sub-section (1) read with the provisions of sub-section (5) of section 132 of the Act, that the officer authorised under section 132 can seize and retain for the purpose of sub-section (5) only those articles which fall within the category of "money, bullion, jewellery or other valuable artic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee concerned, as revealed from his undisclosed income, could be duly satisfied. In other words, the thing or article which can be retained under sub-section (5) of section 132 should be the one which is carrying its own intrinsic value in terms of money. Therefore, the question is whether the fixed deposit receipts and documents of title relating to an immovable property are the things or articles which can be evaluated in terms of money. Obviously, a document of title relating to an immovable property or even a fixed deposit receipt issued by a bank in favour of a particular person are merely the documents of title which, though possessing much evidentiary value, do not possess any intrinsic market value. They do supply evidence of assets which by themselves are valuable but they being mere documents of title, they can neither be negotiated nor be transferred for a valuable consideration. Under the circumstances, we are of the opinion that documents of title, which have no greater value than an evidentiary one, and which do not carry any saleable interest, are not the "valuable things or articles" contemplated either by sub-section (5) of section 132 of the Act or by rule 112A of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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