9911796707
TMI Blog1985 (1) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... given to the distributors of the cinema on various dates and that the books were required for facilitating verification and that they are, therefore, impounded until further orders. The matter was posted again to April 24, 1984, on which date the respondent issued summons to the Assistant Commercial Tax Officer for production of the daily collection reports, etc., seized from the distributors. As the petitioner and his representatives were not present on April 24, 1984, the respondent adjourned the case to April 26, 1984, on which date the A.C.T.O. and the assessee were also present. A statement was recorded from the assessee as well as from the A.C.T.O. on that day. It appears that the petitioner did not choose to cross-examine the A.C.T.O. On May 11, 1984, the petitioner filed an application before the respondent requesting (1) for copies of the D.C.Rs. (Daily Collection Reports) seized by the sales-tax authorities ; (2) copy of the petitioner's sworn deposition; (3) release of the impounded account books and the D.C.Rs., etc. ; and (4) depositions taken from the distributors and requesting for stay of the assessment proceedings till such time as the requests of the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l for the Department, contends that the retention of the books is not illegal, that II prior " approval for retention beyond 15 days is not contemplated and such approval can be obtained subsequent to the retention and could validate the previous retention of the books. He also submits that the communication of the approval to the petitioner is not necessary and that the petitioner is not entitled to certified copies of the D.C.Rs. Two questions mainly arise for consideration : The first question that arises for consideration is : Whether in cases where books of account and documents are impounded by the ITO under sub-s. (3) of s. 131 of the Act and he decides to retain them beyond fifteen days (exclusive of holidays), it is incumbent upon him to obtain the approval and " communicate " the approval of the Commissioner to the person from whom they are received and impounded. The second question will be whether the approval of the Commissioner can be obtained or granted ex Post facto after the expiry of the said period of fifteen days. It is necessary to refer to the relevant provisions of the statute. The provisions of sub-s. (1) of s. 131 of the Act enable the ITO, the AAC, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , " shall not retain " the custody of the books and documents impounded beyond fifteen days (exclusive of holidays) without " obtaining the approval " of the Commissioner therefor, the provisions of sub-s. (8) of s. 132 direct that the books of account or documents seized " shall not be retained " beyond a period of one hundred and eighty days unless the reasons for retaining the same are recorded by him in writing and " the approval " of the Commissioner for such retention obtained. Thus, while under s. 131(3), the retention of the books of account and documents beyond fifteen days as prescribed is not permissible unless the condition, namely, the approval of the Commissioner is obtained, the retention under s. 132(8) beyond one hundred and eighty days shall not be made unless two conditions, namely, the reasons for retention are recorded and the approval of the Commissioner is obtained.Under sub-ss.(10) and (12) of s.132, a right is conferred on the concerned person to file objections before the Central Board of Revenue questioning the order of approval of the Commissioner. A reading of the relevant provisions of s. 131(3) and s. 132(10) and (12) would show that Parliament has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roval by the Commissioner is communicated to the concerned persons. We wish to make it further clear that while the obtaining of the approval within the period of 15 days is a mandatory requirement, the communication of the factum and date of approval is not mandatory and will not vitiate the proceedings. In the event of the above officers not communicating the factum of approval or its date, it is open to the concerned person to approach the concerned officer seeking information as to whether the approval of the Commissioner for further retention has been in fact obtained or not or as to when it was obtained and we are sure that in such cases, the officer concerned will not hesitate to inform the concerned person in writing about the factum of the approval of the Commissioner and the date of such approval so that the concerned person may feel satisfied that such approval has been obtained within the mandatory period of 15 days. If the concerned person, however, finds that the approval has not been obtained within the period of 15 days he could immediately seek for return of the books of account and documents on the ground that further retention beyond the period of 15 days is unla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt in Oriental Rubber Works' case [1984] 145 ITR 477, shows that the conclusions at which their Lordships arrived were based on a construction of sub-s. (8) of s. 132 independently without resort to subs. (10) of s. 132. Their Lordships referred to sub-s. (10) of s. 132 as second approach to the same conclusion as is clear from the words "Moreover " used at page 483 of the report. Admittedly, even sub-s. (8) of s. 132, like sub-s. (3) of s. 131, speaks only of " approval" and not" prior approval ". The reasoning of the Division Bench ruling of this court in Hyderabad Vanaspathi Limited v. ITO [1985] 152 ITR I (AP), which dealt with the invalidity of an ex Post facto approval under s. 132(8) also supports our view in regard to s. 131(3). One of us (Jeevan Reddi J.), sitting with Anjaneyulu J., in that case, pointed out that the words in s. 132(8) are negative and the language is " emphatic and mandatory " and observed (P. 5): " The reasons for the concern shown by Parliament are not far to seek. The power of search and seizure conferred by sub-s. (1) is extraordinary. In the interests of proper administration of the Act and public revenue, such a special power is vested, in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Parkash v. ITO [1970] 77 ITR 1010 (P H), to the effect that the reasons recorded by the ITO for impounding need not be communicated to the concerned person., That ruling also does not deal with the various questions relating to the approval of the Commissioner with which we are concerned in the case before us and is, in our view, not relevant. The petitioner is, therefore, forthwith entitled to the return of the books of accounts and documents impounded on April 19, 1984. Of course, it is open to the respondent to impound them again in accordance with the proviso to s. 131(3) or to retain them in accordance with the procedure indicated by us. The other question that remains to be considered is the request of the petitioner for the copy of the deposition of the A.C.T.O. and the certified copies of the Daily Collection Reports (DCRs) seized from the distributors by the entertainment tax authorities. We are of the view that on the facts of this case revealed from the counter-affidavit of the respondent, the interests of justice and fair play would be amply satisfied if we direct the respondent to furnish the certified copy of the deposition of the A.C.T.O. recorded by the respo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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