2017 (10) TMI 109 - HC - Income Tax

Relief for release of gold and jewellery - Department has released the gold and jewellery to the petitioner s brother under similar circumstances - Held that - Considering submission made by the petitioner that apart from search and seizure operation conducted in the business premises of the petitioner similar search and seizure operation was conducted in the business premises of the petitioner s brother. Though order of assessment has been passed against the petitioner s brother till date they have not paid taxes but the Department has released the gold and jewellery to the petitioner s brother. It is not known under what basis the third respondent has released the gold and jewellery to the petitioner s brother especially when they are defaulters in payment of tax as computed by the Assessing Officer. In my considered view this aspect of the matter can also be placed before the ITAT by the petitioner in an application which they can move for appropriate interim direction for release of gold and jewellery. Accordingly this writ petition stands disposed of by giving liberty to the petitioner to file proper interlocutory application in the pending appeal before the ITAT seeking for release of gold and jewellery. It is open to the petitioner to place all points before the ITAT and if such application is filed the ITAT is requested to give preference to the application and consider for an earlier disposal of the application in the light of the fact that the gold and jewellery are in the custody of the Department for over five years. The petitioner is also entitled to raise plea that he alone has been discriminated when his brother has been granted the relief for release of the gold and jewellery.

Summary

Issues:
1. Petitioner seeks to quash an order and release seized gold, jewellery, and cash.
2. Previous writ petition disposed of with a direction to dispose of an appeal.
3. Dispute over release of assets due to pending appeal and interest waiver petition.
4. Third respondent's decision based on potential penalty and ownership dispute.
5. Court directs petitioner to approach the Income-tax Appellate Tribunal for relief.
6. Discrepancy in treatment of petitioner and brother's tax liabilities regarding asset release.
7. Court disposes of the writ petition, granting liberty to file an interlocutory application before ITAT for asset release.

Analysis:
1. The petitioner filed a writ seeking to quash an order and release seized assets. The previous writ petition directed the disposal of an appeal related to the seized gold and jewellery. The current dispute revolves around the release of assets due to a pending appeal and a petition for interest waiver under Section 220(2A) of the Income-tax Act.

2. The third respondent's decision to reject the release request was based on potential penalty implications and ownership disputes over the seized assets. The court directed the petitioner to approach the Income-tax Appellate Tribunal for appropriate interim relief, considering the pending appeal and interest waiver petition.

3. The petitioner highlighted a perceived discrepancy in the treatment of tax liabilities between the petitioner and their brother regarding the release of assets. The court disposed of the writ petition, granting the petitioner liberty to file an interlocutory application before the ITAT seeking the release of gold and jewellery. The ITAT was instructed to consider the application promptly, taking into account the extended custody period of the assets and the potential discrimination in treatment between the petitioner and their brother.