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Issues:
1. Validity of service of notice on the petitioner. 2. Jurisdiction of assessment and penalty imposition. 3. Legality of directing the bank to prepare a draft in the name of the Commissioner of Income-tax. 4. Relief sought by the petitioner regarding the seized amount. Validity of Service of Notice: The petitioner argued that the assessment and penalty imposition proceedings lacked jurisdiction due to invalid notice service. The petitioner claimed not to reside or conduct business at the address where notices were sent. The respondent contended that notices were validly served at the last known address, and as the petitioner failed to respond, orders were passed. The court held that the validity of notice service required factual investigation, pending the petitioner's appeal. The court refrained from quashing the assessment and penalty orders in the absence of conclusive evidence. Jurisdiction of Assessment and Penalty Imposition: The petitioner challenged the jurisdiction of the assessment and penalty imposition due to alleged lack of valid notice service. The respondent argued that the petitioner's failure to respond justified the orders passed. The court emphasized that without a thorough investigation, it couldn't determine the validity of service. The court deferred the decision to the appellate authority pending the petitioner's appeal, refraining from expressing an opinion on jurisdiction. Legality of Directing Bank to Prepare Draft: The petitioner contested the respondent's directive to the bank to convert the fixed deposit into a draft for the Commissioner of Income-tax. The respondent justified the action under section 132(3) of the Income-tax Act, allowing seizure of bank deposits. The court acknowledged the seizure provision but found no legal basis for instructing the bank to convert the deposit. The court ruled the directive invalid, emphasizing that the bank couldn't be compelled to prepare a draft for the tax authority. Relief Sought by the Petitioner: The petitioner sought the return of the seized amount with interest, arguing against the actions of the respondent authorities. The court noted the petitioner's fictitious address provided to the bank and lack of response during proceedings. Considering the petitioner's conduct and the existing demand exceeding the seized amount, the court denied relief in the current petition. The court stated that if the assessment and penalty orders were overturned in subsequent proceedings, the petitioner would be entitled to a refund with interest. This detailed analysis covers the issues of notice validity, jurisdiction, directive legality, and relief sought in the judgment delivered by the High Court of Patna.
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