2019 (3) TMI 1808 - HC - Income Tax

Search proceedings - seizure and attachment of the petitioner's bank account - respondent informed this Court that the petitioner's account was not frozen and on the other hand, only a communication dated 05.09.2017 was issued to the Manager of the Karur Vysya Bank requesting him not to allow any Debit transaction without the knowledge of the respondent department - petitioner submitted that in view of the above statement made by the learned counsel for the respondent, the writ petition may be closed by recording such submission - HELD THAT - Considering submissions made by the learned counsel appearing on either side, this writ petition is closed by recording the statement made by both parties.

Summary

Issues:
Petitioner seeks declaration on the illegality of the respondent's actions regarding the freezing of the bank account. The respondent contests the freezing of the account and accuses the petitioner of non-cooperation with the investigation.

Analysis:
The petitioner filed a writ petition to challenge the respondent's seizure and attachment of the bank account, alleging it to be illegal and without lawful authority. The petitioner's counsel argued that the freezing of the account following a search by the respondent was in violation of Section 132(8A) of the Income Tax Act, 1961, which allows such actions for a maximum of 60 days only. The petitioner sought relief from the continued freezing of the account, stating it to be unlawful.

During the hearing, the respondent's counsel refuted the claim that the account was frozen, stating that only a communication was sent to the bank requesting restrictions on debit transactions without the respondent's knowledge. The respondent's counsel further accused the petitioner of failing to cooperate with the investigation by not attending the inquiry after receiving a summons. The respondent's position was that the account was not frozen, and the petitioner's non-cooperation was hindering the investigation process.

In response to the statements made by both counsels, the petitioner's counsel requested the writ petition to be closed, asserting that the petitioner would cooperate with the investigation. Considering the arguments presented by both sides and the circumstances of the case, the court decided to close the writ petition, recording the submissions made by the parties. No costs were awarded, and the connected miscellaneous petition was also closed as a result of this judgment.