2019 (10) TMI 86 - HC - Income Tax

Return of the seized documents - Warrant for attachment of properties u/s 132(9B) where period of limitation has already expired - HELD THAT - As per section 132(9C) of the said Act, the provisional attachment made u/s 132(9B) of the said Act automatically ceased to have effect after the expiry of a period of six months from the date of the order referred to in sub-section 9B. Therefore, it is admitted by the 4th respondent that the order of attachment, impugned in this writ petition, ceased to have effect after 25.08.2018. When such being the factual and legal position, the first limb of the prayer in this writ petition has become infructuous. Return of documents - It is not the case of the petitioner that the documents sought to be returned have been recovered from the premises of the petitioner and on the other hand, it is the case of the Revenue that they were recovered from the premises of one V.K.Sasikala and others during search operation. Therefore, this Court is of the view that the petitioner is not entitled to seek for return of those documents which are not seized from its premises, more particularly, when it is stated that the assessment proceedings are still going on and not completed. The petitioner is also not entitled to the other limb of the prayer made in this writ petition. - Petition dismissed.

Summary

Issues:
Challenge to order of attachment under section 132(9B) of the Income Tax Act, 1961; Request for return of seized documents.

Analysis:

Issue 1: Challenge to order of attachment under section 132(9B) of the Income Tax Act, 1961
The petitioner challenged the order of the 4th respondent dated 26.02.2018, which was a warrant for attachment of properties under section 132(9B) of the Income Tax Act, 1961. The petitioner's case revolved around the possession of land for specific purposes, inability to exploit it commercially, and a group of shareholders wanting to exit the business. The petitioner had taken temporary custody of important documents for finding suitable buyers. The impugned order of attachment was issued without prior notice to the petitioner. The court noted that the attachment automatically ceased to have effect after six months from the date of the order, which was on 25.08.2018. As the order had expired, the court found the challenge to the attachment order to be infructuous.

Issue 2: Request for return of seized documents
The petitioner sought the return of seized documents, arguing that they were not directly seized from the petitioner but during a search in another case. The respondents contended that the documents were seized during a search operation involving a different party, and the assessment proceedings were ongoing. The court held that since the documents were not seized from the petitioner's premises and the assessment proceedings were still in progress, the petitioner was not entitled to the return of the documents. Therefore, the court dismissed the writ petition on the grounds that the attachment order had expired, and the petitioner was not entitled to the return of the seized documents while assessment proceedings were ongoing.