Procedure to arrest and detention of defaulters. - Income Tax - 1259/CBDT

INSTRUCTION NO. 1259/CBDT Dated : May 18, 1979 Section(s) Referred: 2nd Schedule to I.T Statute: Income - Tax Act, 1961 The Central Board of Direct Taxes in its Instruction No.*331, dated 20th October , 1971 issued from F.No.1/7/69-ITCC, explained the procedure to be followed with regard to arrest and detention of defaulters in civil prison and the steps to be taken before such arrest and detention. Recently, a few instances have been reported to the Board wherein the due procedure has not been followed and thus avoidable adverse publicity has resulted. While the Board desires that the arrest of a defaulter and his detention in civil prison, specified under section 222 and Rule 4 of the Second Schedule as one of the modes of recovery available to the Tax Recovery Officer, should be effectively exercised in suitable cases, it is necessary to ensure that before depriving even a defaulter of his personal liberty, due consideration should be given to the facts and circumstances of the case to decide whether such extreme action is warranted. 2. Instances have also come to the notice of the Board where excessive use of force has been noticed in the actual exercise of the power of arrest. In one case, a Tax Recovery Inspector, authorised by the Tax Recovery Officer, to arrest a defaulter under his warrant, was assisted by five police constables in effecting the arrest, but not withstanding such formidable assistance, tied the hands of the defaulter and later on conveyed him in a three-wheeler to the office of the Tax Recovery Officer with the feet also tied. In another case, when a defaulter had already been apprehended and was detained in the custody of the Tax Recovery Officer in his office, his hands were fettered and linked to the bars of a window. The legal validity and reasonableness of these actions was examined by the Board in consultation with the Ministry of Law . We have been advised that on the facts of these two case, a view is possible that tying the feet in addition to the hands when the defaulter was already in the custody of the Inspector might not have been necessary. Fettering of a defaulter who is in the custody of the Tax Recovery Office by linking them to the bars of a window also appear to be uncalled for. 3. The general legal position in this regard is as under:- (i) Under Rule 73(1), before an order for arrest and detention in the civil prison could be made, the Tax Recovery Officer has to issue and serve a notice on the defaulter calling upon him to appear before the Tax Recovery Officer and to show cause why he should not be committed to civil prison. The Tax Recovery Officer is empowered under the Rule to record the reasons in writing if he is satisfied that the defaulter with the object or effect of obstructing the execution of the certificate has, after the receipt of the certificate, dishonestly transferred, concealed or removed any part of his property, or the defaulter has the means to pay the same. These are essentially questions of fact. The Tax Recovery Officer has to apply his mind judicially to the facts of the case and decide whether the conditions for committing a defaulter to civil prison exist factually and thereafter to record his satisfaction; (ii) Sub-rule (2) of Rule 73 provides that notwithstanding anything contained in sub-rule (1) a warrant for the arrest may be issued after the Tax Recovery Officer is satisfied, that with the object or effect of delaying the execution of the certificate, the defaulter is likely to abscond or leave the local limits of the Tax Recovery Officer. These again are essentially questions of fact but the order has to be passed honestly having regard to all the facts of the case. (iii) Sub-rule (2) of Rule 73 of the Second Schedule to the Income-tax Act further empowers the Tax Recovery Officer to issue a warrant for the arrest of the defaulter. The question arises as to when the fugitive does not submit himself for arrest, how could the arrest be effected? Arrest is a restraint of the liberty of the person and unless there is submission, actual contact is necessary to effect it. There must be touch or confinement or also acquiescence. Mere words cannot constitute an arrest-A.I.R. 1916(Vol.3) Sind P.19. (iv) It is well settled that in making an arrest no more force is to be used than is necessary -A.I.R 1948 Sind 67 at p.73. It is also not necessary that the arresting Office should in arresting the person immediately proceed to put handcuffs on him with cord or chain. Their use can only be justified on the ground that they are means necessary to effect the arrest-(1900-02) 1 Low Bur Ruling 173 (174, 175). The person effecting the arrest is justified under sub-section (2) of section 46 of the Cr.P.C. 1898 in using so much violence as is necessary to effect his object with this qualification, namely, that his right does not, except in the two cases mentioned in sub-section (3) of said section 46, extend to causing the death of the person sought to be arrested A.I.R. 1955 All. 379(381). (v) In view thereof, while it may be necessary for an officer executing the warrant to use force, it should be limited to the minimum extent possible. In executing a warrant, it is necessary to actually touch the defaulter unless he acquisces. If the defaulter unless he acquiesces. If the defaulter acquiesces in the arrest, there is no need to tying up or confining him. Depending upon the facts and circumstances of the case, it may be necessary to use the force to effect the arrest, but it is well settled that in making the arrest no more force is used than it is absolutely necessary. The following observations in Pandhikhan Nandokhan v. Emperor, A.I.R. 1948, Sind p. 67 should be borne in mind:- "The evidence abundantly establishes that at the time when the two appellants hand-cuffed Kassim and Gori Shanker and tied them up with a rope, and kept them in confinement, nothing was said or done by Kassim or by Gori Shanker which justified the appellants to think that they would not submit to custody, if an attempt to arrest them in a legal and proper way was made. The appellants knew that they were not entitled to act in the manner they did and their subsequent conduct, the false pleas put forward on their behalf, and their unwillingness to own what they actually did, clearly shows that". (vi) Rule 76 inter alia provides that upon the conclusion of the enquiry, the Tax Recovery Officer may make an order for the detention of the defaulter in the civil prison, Rule 74 provides that when a defaulter is brought before the Tax Recovery Officer, the latter shall proceed to hear the Income Tax Officer and afford an opportunity to the defaulter. Reading the two together, while the Tax Recovery Office is required to proceed with the hearing expeditiously after the defaulter is brought before him, till the conclusion of the enquiry, however, it is open to him to order detention of the defaulter in the custody of such officer as he may think fit or release him on his furnishing the security for his appearance when required. It is, therefore, for the Tax Recovery Officer to decide whether he should order his detention in the custody of any office under him or release him on security. If he feels in any given case, pending conclusion of the enquiry, to detain the defaulter the above rules permit him to do so so long as the said power is exercised bonafide and within reasonable limits. 4. In this connection, the attention of all the Tax Recovery Officers working in your charge may also be specifically invited to Part V of the Manual on " Law and Practice of Recovery of Direct Taxes" issued by the Directorate of Inspection (RS P) in 1972 so that they can make themselves fully conversant with the legal requirements in this regard and ensure that they act fully in accordance with the prescribed procedure. 5. In para 3 OF INSTRUCTION NO. 331, it was directed that for the purpose of detaining the defaulters, arrangements may be made with the state authorities to lodge the defaulter in Tehsil lock-up. The State authorities would normally agree to give the facility on our paying the subsistence allowance and other necessary charges. The Commissioners were requested to take up the matter with the Chief Secretaries of the various State Governments if any difficulties were encountered in this regard. It is hoped that so far no difficulties in this regard have actually arisen.