2001 (11) TMI 29 - HC - Income Tax

Search And Seizure - a search warrant under section 132 of the Act was issued authorising search and seizure in regard to locker No. 139 maintained by the petitioner herein in the premises of Shaswathi Leasing Private Limited and in pursuance of the said warrant, the locker was again opened, searched, inventorised and sealed. The appellant is aggrieved. - It is thus seen that the procedure prescribed under section 132 has been followed and the satisfaction note shows that there was application of mind and a recording of the finding that there was reason to believe that the circumstances mentioned in the section exist. The learned single judge has considered all these aspects in detail and has rightly come to the conclusion that there is no irregularity or infirmity in the search warrant

Summary

Issues:
1. Validity of search conducted on locker No. 139 on March 31, 1997.
2. Legality of the search warrant issued on April 1, 1997 for the same locker.

Issue 1: Validity of search conducted on locker No. 139 on March 31, 1997:
The appellant contended that the search and seizure conducted on March 31, 1997, when the locker was voluntarily opened, inventoried, and sealed, should have precluded any further search under a fresh warrant on April 1, 1997. The Revenue argued that the March 31, 1997, action was merely an inventory with the appellant's consent and not a search and seizure. The court noted that there was no forcible entry by officers, and the appellant voluntarily facilitated the inventory during the search of Shaswathi Leasing Private Limited's premises. As no seizure occurred on March 31, 1997, the court rejected the appellant's claim regarding the first search.

Issue 2: Legality of the search warrant issued on April 1, 1997:
The appellant contended that since the locker's contents were inventoried on March 31, 1997, a fresh warrant on April 1, 1997, was unnecessary as the information was already known. The court referred to legal principles regarding search and seizure proceedings, emphasizing the need for reliable information justifying the belief for a search. Citing a similar case, the court upheld the validity of the search warrant issued on April 1, 1997. The court highlighted that the search warrant was based on a satisfaction note, showing due application of mind and compliance with the procedure under section 132 of the Income-tax Act, 1961. Consequently, the court dismissed the appeal, affirming the legality of the search warrant issued on April 1, 1997.

In conclusion, the court upheld the legality of the search warrant issued on April 1, 1997, for the locker maintained by the appellant, rejecting the challenges to both the initial inventory on March 31, 1997, and the subsequent search. The judgment emphasized the importance of following due process and legal requirements in search and seizure actions under the Income-tax Act, 1961.