2013 (9) TMI 759 - HC - Income Tax

Application for release of goods within 30 days from the date of seizure Condition of application within the 30 days period is mandatory Held that - Merely because the petitioners application for release of the stock was not made to the Assessing Officer within 30 days from the end of the month in which the seizure was made, cannot be held against the petitioners, for the purpose of considering the petitioners application on merits Decided in favor of Assessee. Applications for release of seized gold to the extent of 5.25 Kgs Held that - Assessing Officer shall consider the petitioners alternative prayer made to release atleast 70% to 50% of the seized gold while retaining the balance to meet the existing liability of the petitioners Partly decided in favor of Assessee.

Summary

Issues:
1. Challenge to the order rejecting the application for release of seized gold under Section 132B(1) of the Income Tax Act, 1961.
2. Timing of the application for release of seized gold.
3. Substantiation of the claim that the seized gold is part of the petitioner's stock in trade.
4. Consideration of the petitioners' application on merits.
5. Opportunity for personal hearing to satisfy the Assessing Officer.

Analysis:
The judgment addresses the challenge against the order rejecting the application for release of seized gold under Section 132B(1) of the Income Tax Act, 1961. The petitioners argued that their application for release was made within the required time frame, even though it was not directly to the Assessing Officer. They contended that the nature and source of acquisition of the seized gold were explained within the stipulated period, and thus, the rejection solely based on timing was unjustified. The court found merit in this argument and directed the Assessing Officer to consider the application without treating it as time-barred, emphasizing the need to evaluate the application on its merits.

Regarding the substantiation of the claim that the seized gold is part of the petitioner's stock in trade, the Assessing Officer had raised concerns about the irregularity in maintaining accounts. The petitioners, however, provided evidence supporting their assertion that the gold was indeed part of their stock in trade. The court acknowledged this discrepancy and directed the Assessing Officer to consider the application expeditiously, allowing for the release of a portion of the seized gold if necessary to meet the petitioners' liabilities.

Furthermore, the judgment highlighted the importance of providing the petitioners with a personal hearing to present their case effectively. Given the conflicting views on whether the seized gold was reflected in the books of account, the court deemed it essential for the Assessing Officer to offer an opportunity for a personal hearing to ensure the petitioners' perspective is adequately considered. This step was seen as crucial in upholding the principles of natural justice and ensuring a fair assessment of the situation.

In conclusion, the judgment focused on addressing the procedural and substantive aspects of the case, emphasizing the need for a thorough evaluation of the petitioners' claims and ensuring a fair opportunity for them to present their case effectively before the Assessing Officer.