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TMI Blog2020 (9) TMI 871X X X X Extracts X X X X X X X X Extracts X X X X ..... ising them to issue notices to co-operative banks/ urban co-operative banks/credit co-operative societies coming under the respective jurisdiction calling for information as contemplated under section 133(6) of the Income-tax Act. By virtue of these documents, the Income-tax Officer (Intelligence) is the authorised person who could issue exhibit P1, therefore, the allegation that the officer who issued exhibit P1 had no authority has to be rejected. Then coming to section 133(6) of the Income-tax Act, in Kathiroor Service Co-operative Bank's case (supra), various co-operative societies registered under the Kerala Co-operative Societies Act engaged in banking business were before this court when notices were issued to the societies under section 133(6) of the Act calling for particulars of cash transaction above rupees one lakh with details of account holders/deposit holders in the format prepared by the authority issuing the notices. The societies challenged the validity of the notices. After referring to section 133(6) of the Act, prior to the introduction of the second proviso and its effect and after the introduction of the second proviso to section 133(6), their Lordship ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad case for adjudication of the questions of law raised in all the appeals. The questions of law raised for consideration are as following : (1) Whether the Income-tax Officer (Intelligence) is an authority to issue notice under section 133(6) of the Income-tax Act to the appellant prior to Notification No. 77 of 2014 of the Central Board of Direct Taxes, dated December 10, 2014 ? (2) Whether the notice under section 133(6) issued by the Income-tax Officer (Intelligence) is valid prior to Notification No. 77 of 2014 of the Central Board of Direct Taxes on the delegation of power dated December 10, 2014 ? (3) Whether the 'Inquiry' under section 133(6) in the absence of an 'enquiry' under any of the provisions of the Act, conducted by the Income-tax Officer (Intelligence) is right in the eye of law ? (4) Whether the notice under section 133(6) issued by the Income-tax Officer (Intelligence) is valid in the absence of a formation of opinion as to whether it will be useful for or relevant to any enquiry or proceeding under the Act ? (5) Whether a notice under section 133(6) can be issued on the appellant which is not a 'person' as per Income-tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The proviso does not authorize the Income-tax Officer (Intelligence) to make such an inquiry. (iv) Section 120 of the Act do not envisage any power of delegation in the absence of any direction of the Central Board of Direct Taxes. The enquiry under section 133(6) has no nexus with any inquiry under the Act. Enquiry is a request for information, whereas inquiry is the investigation because as per the statement of facts of the respondents, the Income-tax Officer (Intelligence) is not an Assessing Officer. (v) As per the Manual of Office Procedure , the responsibility for collection, collation and dissemination of information was with the Central Information Branch. But vide notification dated September 6, 2013 (annexure G attached to the statement of the respondents in I. T. A. No. 265 of 2019), the aforementioned powers vested with the Income-tax Officer (Intelligence), Kochi, to collect the information, thus, the role of Income-tax Officer (Intelligence) and that of the Assessing Officer as per the Manual of Office Procedure is totally different, but the Tribunal did not address such issues, though, specifically raised in the memorandum of appeals. (vi) In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as challenged, by relying upon the judgment in Kathiroor Service Co-operative Bank Ltd. (supra) and it was held that as per the notification dated August 19, 2011 which was in vogue, the Directors of Income-tax had all the powers to issue orders in writing in relation to and in connection with collection, collation, verification and dissemination of information. The validity of notices under challenge and the jurisdiction of the Income-tax Officer (Intelligence) to issue the notices, were upheld. 9. Vide order/notification dated November 1, 2011, the Income-tax Officer, Thiruvananthapuram, Alappuzha, Kochi and Thrissur were authorised to function as Income-tax Officer (Intelligence) and by subsequent letter dated September 2, 2013, handed over during the course of hearing, the Director of Income-tax (Intelligence) authorised the Income-tax Officers (Intelligence) to issue notices to co-operative banks/urban co-operative banks/credit co-operative societies, calling for information. The scope of enquiry was in respect of the survey. 10. It was further argued that there is no merit in the appeals nor any questions of law arises for determination and prayed for dismissal of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or as the case may be, assigned to, the Assessing Officer by or under this Act in respect of any specified area or persons or classes of persons or incomes or classes of income or cases or classes of cases, shall be exercised or performed by an Additional Commissioner or an Additional Director or a Joint Commissioner or a Joint Director and, where any order is made under this clause, references in any other provision of this Act or in any rule made thereunder to the Assessing Officer shall be deemed to be references to such Additional Commissioner or Additional Director or Joint Commissioner or Joint Director by whom the powers and functions are to be exercised or performed under such order, and any provision of this Act requiring approval or sanction of the Joint Commissioner shall not apply. (5) The directions and orders referred to in sub-sections (1) and (2) may wherever considered necessary or appropriate for the proper management of the work, require two or more Assessing Officers (whether or not of the same class) to exercise and perform, concurrently, the powers and functions in respect of any area or persons or classes of persons or incomes or classes of income or cases ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exchange has paid any sum in connection with the transfer, whether by way of sale, exchange or otherwise, of assets, or on whose behalf or from whom he or the exchange has received any such sum, together with particulars of all such payments and receipts ; (6) require any person including a banking company or any officer thereof, to furnish information in relation to such points or matters, or to furnish statements of accounts and affairs verified in the manner specified by the Assessing Officer, the Deputy Commissioner (Appeals), the Joint Commissioner or the Commissioner (Appeals), giving information in relation to such points or matters as, in the opinion of the Assessing Officer, the Deputy Commissioner (Appeals), the Joint Commissioner or the Commissioner (Appeals), will be useful for, or relevant to, any enquiry or proceeding under this Act : Provided that the powers referred to in clause (6), may also be exercised by the Principal Director General or Director General, the Principal Chief Commissioner or Chief Commissioner, the Principal Director or Director or the Principal Commissioner or Commissioner or the Joint Director or Deputy Director or Assistant Director : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rect Taxes, Number(s) S. O. 883(E), dated September 14, 2001, S. O. 494(E), dated March 13, 2008, S. O. 855(E), dated May 31, 2007 and S. O. 856(E), dated May 31, 2007, the Central Board of Direct Taxes hereby directs that : (i) the Director General of Income-tax specified in column (2) of the Schedule-1 annexed to this notification, having his headquarters at the place specified in the corresponding entries in column (3) of the said Schedule shall exercise the powers and perform the functions in respect of such territorial area or of such persons or classes of persons or of such incomes or classes of incomes or of such cases or classes of cases, in respect of which the Directors of Income-tax specified in the corresponding entries in column (4) of the said Schedule are having jurisdiction ; (ii) the Directors of Income-tax specified in column (2) annexed to this notification, having their headquarters at the places specified in the corresponding entries in column (3) of the said Schedule-2, shall exercise powers and perform functions specified in column (5) of the aforesaid Schedule in respect of territorial areas specified in column (4) of the aforesaid Schedule ; 2. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... collection, dissemination as well as enquiry. It is a matter of record that the appellants did not provide any information on receipt of the impugned notice resulting into imposition of penalty. (iii) There is nothing in the notification dated August 19, 2011, which would arrest the power of the Director of Income-tax to authorise Income-tax authorities to initiate actions. By specifying section 133, in the notification dated December 10, 2014, would not mean that the Income-tax authorities did not have any jurisdiction to issue the impugned notice in the year 2013. The procedure prescribed under sub-section (6) of section 133 is akin to a survey in order to ascertain whether the co-operative banks failed to divulge information with regard to the receipts of more than ₹ 5 lakhs within three immediate assessment years. (iv) Reliance on the manual, it is only with regard to the procedure which would not partake the powers and the functions of the authorities enumerated in the Principal Act. (v) In Kathiroor Service Bank (supra), the question which came to be pondered was that it pertained to challenge of the notices, issued under section 133(6) by various Income-tax au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Income-tax Act. By virtue of these documents, the Income-tax Officer (Intelligence) is the authorised person who could issue exhibit P1, therefore, the allegation that the officer who issued exhibit P1 had no authority has to be rejected. Then coming to section 133(6) of the Income-tax Act, in Kathiroor Service Co-operative Bank's case (supra), various co-operative societies registered under the Kerala Co-operative Societies Act engaged in banking business were before this court when notices were issued to the societies under section 133(6) of the Act calling for particulars of cash transaction above rupees one lakh with details of account holders/deposit holders in the format prepared by the authority issuing the notices. The societies challenged the validity of the notices. After referring to section 133(6) of the Act, prior to the introduction of the second proviso and its effect and after the introduction of the second proviso to section 133(6), their Lordships opined that there was no scope for interfering with validity of notices. 13. From the reliance on the notification dated November 1, 2011, it is decipherable that the power of collection, collation and d ..... 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