1983 (3) TMI 254 - HC - VAT and Sales Tax

Issues Involved:

1. Validity of the search warrant issued by the Magistrate.
2. Legality of the retention of seized documents beyond 60 days.
3. Requirement of notice and hearing before extending the retention period.
4. Non-communication of the retention orders to the petitioner.
5. Validity of the search and seizure in light of the panch witnesses not being from the locality.
6. Deficiencies in the search warrant.
7. Alleged indiscriminate seizure of documents.

Issue-wise Detailed Analysis:

1. Validity of the search warrant issued by the Magistrate:

The petitioner challenged the search warrant issued by the Magistrate under Section 93 of the Criminal Procedure Code and Section 28(2) of the Karnataka Sales Tax Act, 1957. The Court noted that the search warrant and the seizure derive their authority from the Magistrate's order for search. Since the petitioner did not challenge the primary order for search, the Court found it proper to decline to examine the search warrant's validity on that ground alone. However, the Court proceeded to examine the other contentions due to the records being available and the arguments addressed by both parties.

2. Legality of the retention of seized documents beyond 60 days:

The C.T.O. retained the seized documents beyond the initial 60 days with the permission of his superior officer, the Deputy Commissioner (D.C.). The D.C. granted extensions on 4th January 1983 and 7th March 1983, based on the C.T.O.'s requests. The Court found that the proviso to Section 28(3) of the Act allows retention beyond 60 days with the next higher authority's permission. The orders for retention were deemed valid as the D.C. was satisfied with the reasons provided by the C.T.O.

3. Requirement of notice and hearing before extending the retention period:

The petitioner argued that the D.C.'s power to extend the retention period was quasi-judicial and required notice and a hearing. The Court disagreed, holding that the power under the proviso to Section 28(3) of the Act was administrative, not quasi-judicial. Therefore, there was no obligation to notify the petitioner or afford him an opportunity of hearing before making the order. The Court cited rulings from the Allahabad High Court and the Gujarat High Court supporting this view.

4. Non-communication of the retention orders to the petitioner:

The petitioner contended that non-communication of the retention orders vitiated them. The Court found that the proviso to Section 28(3) did not require communication of the orders. The validity of an order does not depend on its communication. The Court rejected the petitioner's reliance on the Calcutta High Court ruling in Mahabir Prasad Poddar's case, noting that the Karnataka Sales Tax Act did not contain similar provisions to the Income-tax Act, 1961, which required communication of such orders.

5. Validity of the search and seizure in light of the panch witnesses not being from the locality:

The petitioner argued that the search and seizure were vitiated because the panch witnesses were not from the locality, as required by Section 100 of the Criminal Procedure Code. The Court acknowledged the contravention but held that it was a curable irregularity, not an illegality that vitiated the search and seizure. The Court relied on a similar ruling in Hanuman Traders' case, which was binding until overturned by a higher court.

6. Deficiencies in the search warrant:

The petitioner contended that the search warrant's deficiencies, such as the omission of the officer's name and improper filling of columns, vitiated the search and seizure. The Court found that these were curable irregularities and did not invalidate the search warrant or the consequent search and seizure.

7. Alleged indiscriminate seizure of documents:

The petitioner claimed that the C.T.O. seized documents indiscriminately without prima facie satisfaction that they related to the firm. The Court examined the order of seizure and found that the officer was satisfied that the documents were necessary for the inquiry under the Act. The Court held that it was neither possible nor desirable to scrutinize each document meticulously before seizing them. The Court rejected the petitioner's contention, finding no evidence of whimsical or indiscriminate seizure.

Conclusion:

As all the contentions urged by the petitioner failed, the writ petition was rejected with costs. The Court permitted the learned High Court Government Pleader to file her memo of appearance for the respondent within 15 days and ordered a certified carbon copy of the order to be furnished to her.

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