2021 (4) TMI 1255 - HC - Income Tax

Attachment of the property envisaged under Section 132(9B) - HELD THAT - As the provisional attachment of the property envisaged under Section 132(9B) is of property 'belonging to the assessee', meaning the person/assessee searched. In the light of the confirmation by the Standing Counsel to the effect that the aforesaid two individuals have not been subjected to search and seizure under Section 132, there is no justification for the provisional attachment of their assets. Thus the attachments of the fixed deposits in the name of the two individuals as aforesaid, as per the details furnished in warrant for attachment of properties dated 22.03.2021, will stand lifted forthwith.

Summary

Issues:
1. Provisional attachment of property under Section 132(9B) of the Income Tax Act, 1961 in the absence of search and seizure of individuals.

Analysis:
The Honorable Dr. Justice Anita Sumanth, in the case at hand, addressed the issue of provisional attachment of property under Section 132(9B) of the Income Tax Act, 1961 concerning individuals who were not subjected to search and seizure. The learned Senior Standing Counsel confirmed that no warrants under the Act had been issued in the names of the individuals in question. Section 132(9B) allows for provisional attachment of property belonging to the assessee who has been searched. As the two individuals had not been subjected to search and seizure, the court found no justification for the attachment of their assets. Consequently, the attachments of fixed deposits in their names were ordered to be lifted immediately.

The judgment emphasized the requirement for the property to belong to the assessee who is searched under Section 132 for provisional attachment to be valid. Since the individuals in question were not part of the search and seizure proceedings, the provisional attachment of their assets was deemed unwarranted. The court's decision to lift the attachment was based on the lack of legal basis for attaching the fixed deposits in the names of the individuals. The judge directed the respondents to file a counter by a specified date, ensuring due process and opportunity for further submissions before the court.

In conclusion, the judgment by Honorable Dr. Justice Anita Sumanth clarified the legal provisions regarding provisional attachment of property under Section 132(9B) of the Income Tax Act, 1961. The ruling underscored the necessity for the property to belong to the assessee who is the subject of search and seizure actions. In this case, where the individuals in question had not been searched, the court ordered the immediate lifting of the provisional attachment on their assets. The judgment upheld the principles of fairness and adherence to legal procedures in matters concerning the attachment of properties under income tax laws.