1972 (4) TMI 6 - HC - Income Tax

Property is not available with the police. Under the authority of a warrant issued by the Commissioner of Income-tax, the officers. of that department have taken custody of this amount from the police station. Proceedings are now pending before the Commissioner of Income-tax. These proceedings are not criminal proceedings. No case is now pending before any court. The statutory powers conferred on the income-tax authorities to deal with the seizure cannot be interfered with by the exercise of the powers under section 439 or under the inherent powers of the court under section 561 A of the Criminal Procedure Code. The petitioner in this case prays for an order directing the Commissioner of Income-tax to return the amount seized to him - no such direction can be given - revision fails and the same is dismissed

Summary

Issues:
1. Seizure of currency notes under section 54 of the Criminal Procedure Code.
2. Disposal of seized property under section 523 of the Criminal Procedure Code.
3. Authority of income-tax officers to seize property under section 132 of the Income-tax Act.
4. Jurisdiction of the court under section 561A of the Criminal Procedure Code.
5. Availability of property for court orders under section 517 of the Criminal Procedure Code.

Analysis:
1. The judgment revolves around the seizure of currency notes from an individual under section 54 of the Criminal Procedure Code by a police officer. The individual was arrested on suspicion and the currency notes were not sent to court but were later taken by the Income-tax authorities under a warrant issued by the Commissioner of Income-tax under section 132 of the Income-tax Act.

2. The court analyzed the provisions of section 523 of the Criminal Procedure Code, which govern the disposal of seized property. It was noted that if property seized by the police is not produced before the court during enquiry or trial, the court has the power to make orders regarding its disposal. However, in this case, as the currency notes were not available with the police but were taken by the Income-tax authorities, the court held that no order could be made under section 517 or section 561A of the Criminal Procedure Code.

3. The judgment emphasized the authority of the income-tax officers to seize property under section 132 of the Income-tax Act. It was highlighted that the proceedings before income-tax authorities are not criminal proceedings, and the statutory powers conferred on them cannot be interfered with by the court under section 439 or section 561A of the Criminal Procedure Code.

4. Regarding the jurisdiction of the court under section 561A of the Criminal Procedure Code, it was clarified that even if the police or income-tax authorities exceeded their jurisdiction in seizing or handling over the amount, the remedy for the petitioner would not lie under this section.

5. The court further explained that for any court order under section 517 of the Criminal Procedure Code or for the return of property value under section 561A, the property must be available. In this case, as the currency notes were with the income-tax authorities pending proceedings, no direction for their return could be given by the court.

In conclusion, the court dismissed the revision, stating that the petitioner's prayer for an order directing the Commissioner of Income-tax to return the seized amount could not be granted due to the statutory powers of the income-tax authorities and the absence of the property with the police for court orders.