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TMI Blog2024 (11) TMI 324X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner from raising the objections before the Central Board of Direct Taxes as provided under sub-section (10) of section 132 of the Act. The respondents by not providing reasons for almost two years has deprived the petitioner from raising objections for such retention. This itself is enough to hold that the respondents are not authorized to continue retention in spite of the fact that such retention is extended upto 30.04.2025. This Court in case of Cowasjee Nusserwanji Dinshaw [ 1987 (3) TMI 106 - GUJARAT HIGH COURT] after analyzing the provisions of section 132 of the Act and conjoint reading of the provisions of sub-sections (8), (10) and (12) held that the assessee must be communicated reasons recorded by the Authorized Officer on the basis whereof the Commissioner granted necessary approval . Thereafter, considering the decisions of Oriental Rubber Work [ 1983 (11) TMI 1 - SUPREME COURT] it was held that failure to communicate the reasons recorded would render further retention of the account books and documents seized udder sub-section (8) of section 132 illegal, invalid and unlawful. Thus, the respondent-authorities are not justified in continuing the retention of books of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the outstanding demand. 5. The petitioner also made an application under the Right to Information Act,2005 for the reasons recorded for retention of the Books and other documents by the respondents which was replied by reply dated 04.03.2024 and copy of the decision/ approval of extending retention of the document under section 132 (8) of the Act was provided. 6. It appears that the petitioner thereafter preferred the present petition for return of books of accounts and documents seized during the course of search as well as setting aside the recovery proceedings thereafter. 7. During the pendency of this petition CIT (A) passed an order reducing the demand by granting substantial relief to the petitioner. The respondents have already passed an order giving effect to the order of the CIT (A) for the three assessment year as under: Sr.No. AY Assessed Income Relief Granted by Ld. CIT (A) Payment made in installments Balance amount payable/recoverable after appeal effect (In Rs.) 1 2017-18 11,35,00,000 11,35,00,000/- 20,00,000/- (-)23,23,275/- 2 2019-20 92,28,006 0 3,00,000/- 35,04,771/- 3 2020-21 97,72,06,645 92,68,25,695 3,25,00,000/- 4,15,35,907/- 3,48,00,000 4,27,17,403/- 8. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interference is required to be made for returning the same to the petitioner. It was submitted that the books of accounts and other documents are required for the purpose of preferring appeal as well as to prove the case of the department before the higher appellate authority. 13. It was further submitted that at the relevant time also, the approval was first granted on 19.04.2022 immediately after the assessment order was passed as provided under section 132 (8) of the Act and there is no violation of any of the provisions of the Act. It was submitted that the reliance placed by the petitioner on the decisions are on the facts stated therein and the same would not be applicable in the facts of the case inasmuch as there is no delay on the part of the respondent-authorities to record the reasons and get the approval for retention of the books and other documents. It was submitted that recovery proceedings were initiated against the petitioner as the petitioner failed to pay the outstanding demand of more than Rs. 100 Crore which is now reduced pursuant to the order passed by the CIT (A)which would be challenged shortly before the Tribunal. 14. Having heard learned advocates for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner], [Principal Commissioner or Commissioner], [Principal Director General or Director General] or [Principal Director or Director]] under sub-section (8), he may make an application to the Board stating therein the reasons for such objection and requesting for the return of the books of account or other documents [and the Board may, after giving the applicant an opportunity of being heard, pass such orders as it thinks fit]. 17. On perusal of the above provision, it is clear that the respondents by not providing reasons for almost two years has deprived the petitioner from raising objections for such retention. This itself is enough to hold that the respondents are not authorized to continue retention in spite of the fact that such retention is extended upto 30.04.2025. Hon ble Supreme Court in case of Oriental Rubber Works (supra) while applying the provisions of section 132 (8) at the relevant time has held as under: 4. In order to decide the aforesaid contention it will be desirable to set out the material provisions of sec.132 of the Act, namely, sub-secs. (8), (10) and (12) thereof, which run as follows: (8) The books of account or other documents seized under sub-section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been seized or the person to whom these belong) acquires a right to the return of the same forthwith. It is true that sub-sec. (8) does not in terms provide that the Commissioner's approval or the recorded reasons on which it might be based should be communicated to the concerned person but in our view since the person concerned is bound to be materially prejudiced in the enforcement of his right to have such books and documents returned to him by being kept ignorant about the factum of fulfillment of either of the conditions it is obligatory upon the Revenue to communicate the Commissioner's approval as also the recorded reasons to the person concerned. In the absence of such communication the Commissioner's decision according his approval will not become effective. 5. Moreover, sub-sec.(10) confers upon the person legally entitled to the return of the seized books and documents a right to object to the approval given by the Commissioner under sub-sec.(8) by making an application to the Central Board stating therein the reasons for such objection and under sub-sec.(12) it is provided that the Central Board may, after giving the applicant an opportunity of being he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to retain the books of account and other material beyond the period of 180 days because notices under sec. 158BC under the Act had been issued and, according to the provisions of the Act, the respondent authorities have to complete the assessment on or before 31st December 2001. It has been further stated that for the purpose of completion of some of the consequential procedures, a further period of three months is required and therefore the Assessing Officer had prayed for extension upto 31st March 2002, which was duly accorded by the Commissioner. Xxxx 12. Looking to the facts of the case, we are of the view that it would not be just and proper on the part of the respondent authorities to retain the books of account and other seized material till the block assessment is completed. It is true that the Act gives powers to the authorities to retain the books of account and other material beyond the period of 180 days but that does not mean that the permission should be granted by the higher authorities as a matter of course. The power which has been given to higher authority for giving approval for further retention of the books of account and other seized material is to be used wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... officer in writing, and (i) the approval of the Commissioner is obtained. Both these things are a pre-condition. They must be done before the period of 180 days expires. This conclusion is supported by the strong language 2b sub-section (8) is worded. To use the language of Lord Russell of Killowen, The wording is too strong to justify the view. Smith v. Cammel, Laird Co. [1940] AC 242 (HL). 8. The sub-section is framed in negative and prohibitory terms. It says that the books of account shall n6t be retained for a period exceeding one hundred and eighty days . The words not , 'exceeding , are the key words. These words go to the power and jurisdiction itself. Neglect to comply with the conditions of the sub-section is fatal to the right of retention beyond 180 days. Negative words alone are a deciding factor to compel a mandatory construction of a statute of this kind. We do not agree that even if the approval of the Commissioner is accorded after the expiry of 180 days, the retention of the books will be Valid. We, respectfully, agree with the view expressed by the Division Bench of this Court. We do not think that sub-section (8) is widely worded, as is the view of the Alla ..... X X X X Extracts X X X X X X X X Extracts X X X X
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