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1987 (6) TMI 24

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..... " purchies " valued at Rs. 8,30,877 and post-dated cheques for Rs. 1,53,254 as recorded in a seizure list from the ground floor of the said premises where the appellant was staying. During the course of the search, the appellant was examined on oath and she gave a statement in writing before the officers concerned under section 132(4) of the said Act on November 8, 1985. The appellant claimed to be the owner of the said " Purchies " and post-dated cheques. On or about January 23, 1986, the appellant made an application before respondent No. 3 f or release of the said " purchies " and post-dated cheques. Ultimately, the "purchies " seized were released to the appellant upon the latter furnishing a bank guarantee in favour of respondent No. 3 for Rs. 8 lakhs, through the Punjab and Sind Bank, Lindsay Street Branch, Calcutta, respondent No. 5. The said guarantee was dated February 19, 1986, and was effective from that date for period of one year and subject to further renewal at the instance of respondent No. 3. The Income-tax Officer, " C "-Ward II (2), Calcutta, respondent No. 4, has assessed Ashok Kumar Hora, the said son of the appellant, for the accounting period ending .....

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..... bove writ petition before the first court on March 5, 1987, when an order was passed directing the appellant to serve copies of the writ petition on the respondents. Respondent No. 3 was restrained from encashing the said bank guarantee through respondent No. 5 and respondent No. 5 was also directed not to encash the said bank guarantee without leave of court. The petitioner was directed to keep the bank guarantee alive in the meantime. It was contended in the writ petition, inter alia, that the said search and seizure were without any authority of law and amounted to deprivation of the property of the appellant being a contravention under article 300A of the Constitution. It was contended further that the respondents had no jurisdiction to detain the seized ".Purchies " and post-dated cheques or to demand from the appellant a bank guarantee for release of the same. It was contended further that in any event, respondent No. 3 was not entitled to ignore the request of respondent No. 6, the assessing authority of the appellant, to have the period of the bank guarantee extended and to demand from respondent No. 5 encashment of the said guarantee pending the assessment of the app .....

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..... appeal. It is contended that respondent No. 5, the bank, was under a legal obligation to encash the bank guarantee at the instance of respondent No. 3. At the hearing of this application, it was contended on behalf of the appellant that the controversy raised in the present proceeding is in respect of the enforcement of a bank guarantee which has been furnished by respondent No. 5, which is a bank at Calcutta within the jurisdiction of this court. It is contended further that on the basis of the said search and seizure, the Income-tax Officer concerned, viz., respondent No. 6, intends to complete the assessment of the appellant at Calcutta within the said jurisdiction. The same has been recorded in a letter dated February 9, 1987, from respondent No. 6, issued from Calcutta a copy whereof was served on the appellant at Calcutta within the jurisdiction of this court. It was contended that this court had jurisdiction to entertain the writ application as a part of the cause of action of the appellant had arisen within the said jurisdiction. Contentions to the contrary were made on behalf of the respondents, the income-tax authorities. From the facts on record, it appears to .....

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..... ver the articles seized or the bank guarantee furnished by the appellant in lieu thereof to respondent No. 6 who thereupon would be entitled to proceed to take further steps under section 132. Admittedly, respondent No. 3 is seeking to enforce the bank guarantee furnished through a bank at Calcutta against the appellant, the assessee, who is required to be assessed in respect of the said articles seized by respondent No. 6 at Calcutta. Under section 132 of the said Act, no asset can be retained and appropriated before the undisclosed income, if any, is estimated and tax thereon is calculated in accordance with the Income-tax Act. In the instant case, no such estimate of the undisclosed income of the appellant has been made nor has the amount of tax payable by the appellant on such undisclosed income been calculated. It appears that under section 132(9A), respondent No. 3 ceased to have any seisin over the assets seized from the appellant which ought to have been made over to respondent No. 6. Also, prima facie, the present respondent No. 6 has or would be deemed to have seisin over the assets of the appellant which have been seized and it is for respondent No. 6 to decide whethe .....

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