2000 (7) TMI 12 - HC - Income Tax

Summary

Issues: Jurisdiction under section 132 for seizing immovable property, Exhaustion of alternative remedy under subsection (11) of section 132

Jurisdiction under section 132 for seizing immovable property:
The petitioner challenged the orders made under section 132(1) of the Income-tax Act, contending that the officers had no jurisdiction to seize or retain immovable property. The Assistant Director of Income-tax conducted a search at the petitioner's premises and issued an order prohibiting disposal of certain properties. Subsequently, another officer endorsed this order directing the retention of the immovable properties. The petitioner argued that section 132 only applies to movables like books of account, documents, money, bullion, and jewelry. The Revenue authorities, however, contended that immovable properties also fell within the scope of section 132. The High Court analyzed the provisions of section 132 and concluded that the actions taken by the officers were without jurisdiction. The court emphasized that the authorized officer could seize only specific items listed in section 132(1), not immovable properties. Referring to a previous judgment, the court held that the scope of section 132 did not extend to immovable properties. Consequently, the court quashed the impugned orders seizing the immovable properties.

Exhaustion of alternative remedy under subsection (11) of section 132:
The Revenue authorities raised a preliminary objection, arguing that the petitioner should have exhausted the alternative remedy provided under subsection (11) of section 132 before approaching the High Court under article 226/227 of the Constitution. However, the High Court did not delve into this issue as it found the actions of the officers to be without jurisdiction. The court's decision to quash the orders rendered this preliminary objection moot. The court allowed the petition, quashed the impugned orders, and made no order as to costs, directing the refund of any security deposit to the petitioner after verification.