2025 (2) TMI 989 - HC - Income Tax

Income Tax Department to conduct an inquiry and investigate the alleged illegal cash transactions - HELD THAT - Petitioner is unable to indicate as to what fundamental or statutory rights of the petitioner have been infracted or violated. From the submissions as also after perusing the pleadings of the petitioner it appears that the present petition is predicated upon a matrimonial feud between the petitioner and respondent no. 3. That apart record also reveals that the disputes are hotly contested and involve highly complex and disputed questions of facts which will not be within the purview of the Income Tax department to adjudicate. Similarly such disputed questions of facts also cannot be adjudicated under Article 226 of the Constitution of India. As also been unable to indicate the provision under which such a complaint has been submitted to the Income Tax department. Clearly the complaint was not under a statutory scheme or a regulatory mechanism available under the Income Tax Act 1961 thus the question of non-response to such complaint constituting violation of fundamental right or even a civil or statutory right of the petitioner is non-existent. The said submission is unmerited.

Summary

ISSUES PRESENTED and CONSIDERED:1. Whether the Income Tax Department has a duty to investigate alleged illegal cash transactions and financial misconduct?2. Whether the petitioner's complaint under Article 226 of the Constitution of India is valid and justifiable?3. Whether the petitioner's rights have been infringed or violated by the non-response of the Income Tax Department to the complaint?ISSUE-WISE DETAILED ANALYSIS:Issue 1: Duty of the Income Tax Department to Investigate Financial Misconduct- Relevant legal framework and precedents: Section 296ST of the Income Tax Act, 1961 prohibits cash transactions exceeding Rs. 2,00,000 to curb black money and tax evasion.- Court's interpretation and reasoning: The Court noted that the petitioner sought an investigation into alleged cash transactions and financial records of respondents, citing the Income Tax Act.- Key evidence and findings: The petitioner submitted a formal complaint to the Income Tax Department regarding the alleged financial misconduct.- Application of law to facts: The Court considered the duty of the Income Tax Department to investigate such complaints under the relevant legal provisions.- Treatment of competing arguments: The petitioner argued for the investigation based on the complaint and admissions made by the respondent.- Conclusions: The Court dismissed the petition as it found the petitioner's claims of financial misconduct and the duty of the Income Tax Department to investigate to be unsubstantiated.Issue 2: Validity of the Petitioner's Complaint under Article 226- Relevant legal framework and precedents: Article 226 of the Constitution of India allows for the issuance of writs for enforcement of fundamental rights.- Court's interpretation and reasoning: The Court questioned the basis of the petitioner's complaint under Article 226, as it appeared to stem from a matrimonial feud.- Key evidence and findings: The Court observed that the disputes involved complex and disputed factual questions beyond the purview of the Income Tax department.- Application of law to facts: The Court analyzed the nature of the complaint and its alignment with the statutory schemes under the Income Tax Act.- Treatment of competing arguments: The petitioner sought relief through the court process, which the Court deemed impermissible.- Conclusions: The Court dismissed the petition, stating that the complaint did not fall under a statutory scheme or regulatory mechanism, and the petitioner's rights were not violated.Issue 3: Alleged Infringement of Petitioner's Rights by Non-Response of Income Tax Department- Relevant legal framework and precedents: Fundamental rights under the Constitution of India.- Court's interpretation and reasoning: The Court found no infringement of the petitioner's rights by the non-response of the Income Tax Department to the complaint.- Key evidence and findings: The Court noted the absence of a statutory basis for the complaint and the lack of merit in the petitioner's claims.- Application of law to facts: The Court analyzed the petitioner's submissions and the legal framework governing the complaint.- Treatment of competing arguments: The petitioner argued that the non-response constituted a violation of rights, but the Court found such claims unmerited.- Conclusions: The Court dismissed the petition, concluding that the non-response to the complaint did not amount to a violation of the petitioner's rights.SIGNIFICANT HOLDINGS:- The Court dismissed the petition as the petitioner's claims of financial misconduct and the duty of the Income Tax Department to investigate were not substantiated.- The Court found the complaint under Article 226 to be impermissible and beyond the scope of the Income Tax department's jurisdiction.- The Court concluded that the non-response of the Income Tax Department to the complaint did not infringe upon the petitioner's rights.Overall, the Court dismissed the petition, emphasizing the lack of legal basis for the claims made by the petitioner and the impermissible nature of the relief sought through the court process.