1982 (1) TMI 41 - HC - Income Tax

Summary

Issues involved: Jurisdiction of the Income Tax Officer (ITO) under section 133A of the Income Tax Act, 1961 and the legality of notices and orders issued during a survey.

Jurisdiction of ITO under section 133A:
The petitioner, a partnership firm, challenged the jurisdiction of the ITO, A-Ward, Bhatinda, to conduct a survey under section 133A of the Income Tax Act. The petitioner argued that they fell under the jurisdiction of the ITO, B-Ward, Bhatinda, as per an order by the Commissioner of Income-tax. However, the respondent contended that a change in territorial jurisdiction had occurred, placing the petitioner under the ITO, A-Ward. The court found that the ITO, A-Ward, had the jurisdiction to conduct the survey based on the territorial division changes and the petitioner's compliance with tax notices issued by the ITO, A-Ward.

Legality of Notices and Orders:
The petitioner further contended that the notices issued by the ITO, A-Ward, under section 131 and the impounding of account books under section 131(3) during the survey were unlawful. The court noted that under section 133A, the ITO had the authority to inspect documents and make inventory but was prohibited from removing them from the premises. As the petitioner cooperated during the survey and did not contravene any provisions, the ITO exceeded jurisdiction by issuing notices under section 131 and impounding the account books. Consequently, the court quashed the notices and the impounding order, directing the return of records to the petitioner.