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TMI Blog1977 (7) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... his court by the respondents in order to appreciate the issues involved herein. The respondents, New Central jute Mills Co. Ltd., in the said application in the court of first instance made under article 226 of the Constitution sought to have the notice dated the 5th June, 1969, issued by the appellant-Income-tax Officer under section 131 of the Income-tax Act, 1961, quashed and/or set aside. On or about April 11, 1963, an order was passed under section 237(b)(i) and (ii) of the Companies Act, 1956, for investigation of the affairs of the respondent-company. By order dated the 12th June, 1964, another co-officer of the Company Law Board was appointed as co-Inspector with coextensive powers under section 237(b)(i) and (ii) of the said Act, along with the previous Inspector. Another Inspector was appointed on the 30th June, 1964, under the above section of the Companies Act in the place and stead of one of the Inspectors appointed earlier. The time to complete the investigation was extended from time to time. The said Inspector obtained order for search and seizure of the respondent's documents from the Chief Presidency Magistrate, Calcutta, District Magistrate, 24-Parganas and D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment and order dated March 5, 1968, in the said Civil Rule, B. N. Banerji J. was pleased to quash the order, obtained by the said Inspectors from the said Magistrate under section 240A of the Companies Act. B. N. Banerji J. by the said order gave liberty to the Inspectors to apply before the said Magistrates on further and better materials for search and seizure and until such applications were made the documents would lie where they were lying. The above-mentioned appeal preferred by the appellant from the order made on August 4,1965, in Matter No. 272 of 1964 [New Central Jute Mills Co. Ltd. v. Dy. Secretary, Ministry of Finance [1966] 36Comp Cas 512 (Cal) ] was heard by the appellate court by a judgment and order passed on March 7, 1969 (New Central Jute Mills Co. Ltd. v. Dy. Secretary, Ministry of Finance [1970] 40 Comp Cas 102 (Cal)]. In the said appeal, the appellate court set aside the judgment and order of B.N. Banerji J. dated August 4, 1965, and, inter alia, quashed the purported orders under section 237(b)(i) and (ii) of the Companies Act, 1956. The respondents did not prefer any appeal from the said judgment and order of the appellate court dated March 7, 1969. On J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er law for the time being in force if you intentionally omit to so attend to give evidence or produce the books of account or documents, a fine up to Rs. 500 may be imposed upon you under section 131(2) of the Income-tax Act, 1961. Sd/-Illegible Income-tax Officer, CC-XX-Cal. Books of account or documents to be produced. 1. Books of accounts, documents and other papers of M/s. New Central Jute Mills Co. Ltd. of 1 1, Clive Row, Calcutta, in your custody." Various points were taken by the respondent-company in its challenge to the said summons. Sabyasachi Mukharji J., who heard the application, quashed the said summons on the ground that the issuer of the summons-appellant No. 1 did not apply his mind to the matter before issuing the said summons. From the said judgment and order of Sabyasachi Mukharji J., this appeal has been preferred. Mr. Balai Pal, on behalf of the revenue, submitted that the impugned notice was issued under section 131(1)(c) of the Income-tax Act, 1961. Section 30 of the Code of Civil Procedure read with Order 11 of the Code was not applicable in the present case. These provisions apply only to parties to a suit. The Income-tax Officer is not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d case. Mr. Pal also referred to us the Full Bench decision of the Madras High Court in Sankaralinga Nadar (T.M.M.) and Bros. v. Commissioner of Income-tax, AIR 1930 Mad 209. From a perusal of section 131 of the Income-tax Act, we are of the opinion, that the power of the Income-tax Officer under that section is co-extensive with that of a court trying a suit under section 30 of the Civil Procedure Code, read with rules 12, 14 and 15 of Order 11 of the Code. Section 131 empowers the officers mentioned in the section to act for the purpose of the Act, but that cannot be the only limitation set out under section 131 imposed upon the powers of the officers mentioned in the said section to act in the terms of the said section. All statutory bodies must act for the purposes of the statute even though the term " for the purposes of the Act " be not expressly stated. Secondly, it appears to us that the statutory power cannot be exercised without application of mind as urged by Mr. R. C. Deb appearing on behalf of the respondent. If such powers are granted then such powers would be so naked that the section itself would become ultra vires. Application of mind must be in regard to the que ..... X X X X Extracts X X X X X X X X Extracts X X X X
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