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TMI Blog2011 (5) TMI 585X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Income-tax Officer (Investigation), Indore to the Police Station In-charge of Chandan Nagar Police Station that the department has started enquiry with regard to the sources of seized amount and the same should not be released to any one until enquiry by the Income-tax Department is completed. A sum of Rs. 36,00,000 was seized from the custody of petitioner No. 2, whose statement was recorded on 10-6-2007 itself under section 131 of the Income-tax Act, 1961 (hereinafter referred to as the IT Act). This petition relates to the authorization issued in respect of the said amount. Warrant of authorization was issued on 11-6-2007, which has been challenged in the present writ petition on the ground that the authority had no information in his possession to enable him to form a reason to believe that money seized from petitioner No. 2 has not been or would not have been disclosed for the purposes of the IT Act. 3. Petitioner No. 1 is M/s. M. Manoj Kumar & Company, a partnership firm duly constituted under the deed of partnership dated 23-9-2006 (Annexure P/1), whereas petitioner No. 2 is Madhavlal Patel from whose possession the amount in question was seized. It is stated in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y material requisite for the satisfaction to have reason to believe that money has not been or would not have been disclosed for the purpose of the IT Act. 4. Respondents submitted the reply, refuting thereby the averments contained in the petition. Accordingly, it has been stated that the powers to issue warrant of authorization has been properly and rightly exercised and the same is valid. 5. Shri P.M. Choudhary, learned counsel appearing for the petitioner and Shri R.L. Jain, learned senior counsel appearing for the revenue made their respective submissions, which have been considered in the succeeding paragraphs. 6. Firstly, we feel it proper to reproduce section 132A of the IT Act for convenience :- "132A. (1) Where the [Director General or Director] or the [Chief Commissioner or Commissioner], in consequence of information in his possession, has reason to believe that- (a) any person to whom a summons under sub-section (1) of section 37 of the Indian Income-tax Act, 1922 (11 of 1922), or under sub-section (1) of section 131 of this Act, or a notice under sub-section (4) of section 22 of the Indian Income-tax Act, 1922, or under sub-section (1) of section 142 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or its custody. (3) Where any books of account, other documents or assets have been delivered to the requisitioning officer, the provisions of sub-sections (4A) to (14) (both inclusive) of section 132 and section 132B shall, so far as may be, apply as if such books of account, other documents or assets had been seized under sub-section (1) of section 132 by the requisitioning officer from the custody of the person referred to in clause (a) or clause (b) or clause (c), as the case may be, of sub-section (1) of this section and as if for the words "the authorised officer" occurring in any of the aforesaid sub-sections (4A) to (14), the words "the requisitioning officer" were substituted.]" 7. Constitutional validity of section 132A of the IT Act has already been upheld by the Hon'ble Supreme Court of India long back in the case of Pooran Mal v. Director of Inspection (Investigation) of Income-tax AIR 1974 SC 348. It has been observed:- "17. We are not, therefore, inclined to hold that the restrictions placed by any of the provisions of section 132, 132A or Rule 112A are unreasonable restrictions on the freedoms under article 19(1)(f) & (g)." 8. It is almost a settled law that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asonable man could have arrived at the conclusion that the action under section 132A was called for although formation of opinion under the said section is subjective. It is well to remember that jurisdiction under article 226 of the Constitution of India of this court is very limited. In fact this court cannot afford to act as an appellate or revisional court and as such has no justification to examine meticulously the information in order to decide for itself as to whether action under section 132A was called for or not. Suffice it to say that in exercise of extraordinary jurisdiction this court can examine whether the act or issuance of an authorisation under section 132A is arbitrary or mala fide or whether the subjective satisfaction which is recorded is such that it indicates lack of application of mind of the appropriate authority. According to me the reason to believe must be based on definable material or materials and if the information or the reason to believe has no nexus with the belief or there is no definable material or tangible information for formation of such belief then in such a case action taken under section 132A of the Income-tax Act, 1961, would be treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ney to Ahmedabad on 9-6-2007 by luxury bus number MP-41 P-0150 from Indore. Seizure was intimated immediately at 2.45 AM on 10-6-2007 by the City Superintendent of Police to the Income-tax Department Record was produced by the Income-tax Department before us through Shri R.L. Jain, learned senior advocate appearing for the revenue, which contains the statement of Madhav Bhai Patel recorded on oath under section 131 of the IT Act. He stated that he was an employee of M/s. M. Manoj Kumar & Company, Puranik Plaza, 1st Floor, Near Prashant Hotel, Jail Road, Indore. He was employed by Tina Bhai, who happened to be the Manager/In-charge of that company. He further stated that he was not the owner of the company. Tina Bhai resides with him in a common flat at 170, Jail Road, 3rd Floor, Indore. Money in question was handed over to him in the evening of 9-6-2007 by Tina Bhai for being delivered to a person at the Office of A. Monoj Kumar & Company, Ganga Dhiya ki Pol, Sakari Seri, Manik Chowk, Ahmedabad. However, particulars of the person to whom the money was to be delivered were not disclosed and instead, he was told that such particulars would be furnished by telephone on his reaching at ..... X X X X Extracts X X X X X X X X Extracts X X X X
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