2020 (2) TMI 661 - HC - Income Tax

Release of assets (jewellery) seized from them during the search and seizure - Application made in representative capacity on behalf of all the family members, including the petitioners herein - application was made by Sh. Lalit Kumar Challani whereas the jewellery was seized either from the residence, wherein the petitioners and others also resided or from the bank lockers of the two petitioners - HELD THAT - We do not find this to be a reasonable justification for not even responding to the application dated 26.04.2019 made by one of the family members, Sh.Lalit Kumar Challani. Even if, according to the respondents, the application could not be made by Sh.Lalit Kumar Challani and the same ought have been made by two petitioners, the least that the respondents could do was to send the response to the said application. The respondents have however, allowed time to pass by their own omission. Thus, it is not correct for the respondents to turn around and say that the application for release of the jewellery was not made within time. In view of the stand taken by the respondents, we permit the petitioners to move the application for release of jewellery seized during the course of search and seizure as well as from their bank lockers. If and when the application is made, the same should be actioned without any delay in accordance with law. In case the respondents reject the same for any reason whatsoever, the same should be communicated by a reasoned order within a period of four weeks from the date the application is made.

Summary

Issues:
1. Non-release of seized assets (jewellery) by respondents after search and seizure under section 132 of the Income Tax Act, 1961.

Analysis:
The petitioners filed a writ petition stating that the respondents failed to release the jewellery seized during a search and seizure operation at the petitioners' residence and bank lockers. The application for release of the jewellery was made by a family member, not the petitioners themselves. The respondents did not respond to the application, prompting the petition. The respondents argued that since the application was not made by the petitioners, it was not actioned. The court found this reasoning inadequate, emphasizing that the respondents should have at least responded to the application made by a family member. The court held that the petitioners should be allowed to move the application for the release of the seized jewellery, and if rejected, a reasoned order should be provided within four weeks.

This judgment highlights the importance of timely responses and actions by authorities in cases involving the release of seized assets. The court emphasized that even if an application is not made by the affected party directly, it should not be ignored, and a response must be provided. The judgment aims to ensure that due process is followed in dealing with seized assets and that decisions regarding their release are made promptly and communicated clearly to the concerned parties.