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Issues Involved
1. Legality of the notice issued under Rule 112A of the Income-tax Rules, 1962. 2. Timeliness of the order passed under Section 132(5) of the Income-tax Act, 1961. 3. Legality of the retention of fixed deposit receipts and documents of title. 4. Requirement of fresh authorization for the search and seizure conducted on 26th August, 1969. Detailed Analysis Issue 1: Legality of the Notice Issued Under Rule 112A The petitioner contended that the notice issued under Rule 112A was illegal as it was issued beyond the 15-day period from the date of seizure, which the petitioner claimed was 10th July 1969. The court found this contention to be without merit, noting that the initial search on 10th July 1969 was incomplete due to commotion and was only completed on 26th August 1969. The notice under Rule 112A was issued within 15 days of the actual completion of the search, thus complying with the legal requirement. Issue 2: Timeliness of the Order Under Section 132(5) The petitioner argued that the order under Section 132(5) was issued beyond the 90-day period from the date of seizure, which, according to him, was 10th July 1969. The court rejected this argument, reiterating that the seizure was completed on 26th August 1969, and therefore, the order issued on 22nd November 1969 was within the 90-day period. Issue 3: Legality of the Retention of Fixed Deposit Receipts and Documents of Title The petitioner claimed that the retention of fixed deposit receipts and documents of title was illegal as no show-cause notice under Rule 112A was issued for these items. The court clarified that Section 132 and Rule 112A distinguish between "money, bullion, jewellery or other valuable articles or things" and "documents." The fixed deposit receipts and title deeds are considered documents and not valuable articles or things with intrinsic market value. Therefore, the retention of these documents falls under Section 132(8), which does not require a show-cause notice under Rule 112A. Issue 4: Requirement of Fresh Authorization for the Search and Seizure on 26th August 1969 The petitioner argued that the search and seizure on 26th August 1969 required fresh authorization as the initial authorization issued on 9th July 1969 had served its purpose. The court dismissed this argument, stating that the initial search on 10th July 1969 was incomplete and the authorization remained valid for the continuation and completion of the search on 26th August 1969. Conclusion The court found no merit in any of the points raised by the petitioner. The petition was dismissed, and the rule was discharged with costs. The court concluded that the actions of the Income-tax Department were in compliance with the legal provisions of the Income-tax Act and the Income-tax Rules. Petition dismissed.
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