Punjab-Haryana High Court
Jiwan Lal Kapoor vs Cit on 15 July, 2003
Equivalent citations: [2003]132TAXMAN286(PUNJ, HAR)
ORDER G.S. Singhvi, J.
This is third round of litigation by the petitioner in the matter of release of jewellery lying with the authorities of Income-tax department which was seized at Bhopal in the month of June, 2002.
2. The facts :
Shri Rajiv Kapoor son of petitioner - Jiwan Lal Kapoor had come to Bhopal in the month of June, 2002 carrying with him gold jewellery weighing 3934.410 grams valued at Rs. 17,50,808. He went to the shop of M/s Shrinagar Jewellers at Bhopal on 18-6-2002 when an income-tax raid look place in that shop. Amongst others, the jewellery which Rajiv Kapoor was carrying with him was also seized alongwith bill books, vouchers etc. by the income-tax authorities from the shop of M/s Shrinagar Jewellers, Bhopal. The officer dealing with the case of M/s Shrinagar Jewellers Bhopal, recorded a prima facie finding that the jewellery seized from Rajiv Kapoor did not belong to M/s Shrinagar Jewellers and that it is the unaccounted jewellery of M/s. J.L. Kapoor and Sons, Amritsar of which Rajiv Kapoor was a representative. After recording the said finding, he transferred the record to his counter-part at Amritsar for taking necessary action against M/s J.L. Kapoor and sons. The assessing officer at Amritsar issued notice to M/s J.L. Kapoor and sons under section 158BD of the Income Tax Act, 1961 (hereinafter referred to as 'the Act').
3. The petitioner challenged the proceedings initiated against M/s. J.L. Kapoor and Sons in C.W.P. No. 1882 of 2002 in which he prayed for issuance of a writ nature of certiorari to quash telephonic authorisation given by the Joint Director of Income Tax, Bhopal the deducting of search and seizure of goods by Assistant Commissioner of Income Tax, Bhopal and for issuance of a writ in the nature of mandamus to release the goods and related documents like bills, books and vouchers. The same was disposed of by a division bench of this court on 4-3-2003 by directing the Assessing Authority to examine the books of account and other material which may be produced before him and then record a finding whether the jewellery seized from Rajiv Kapoor had been accounted for or not. The relevant extracts of the order passed by the division bench read as under :
"It is common case of the parties that the jewellery seized from Rajiv Kapoor cannot be retained by the income-tax authorities if the same stands accounted for/reflected in the account books of M/s. J.L. Kapoor and Sons. It is, therefore, necessary that the assessing officer of M/s. J.L. Kapoor and Sons at Amritsar should examine the books of account including the stock register and record a finding whether the seized jewellery lying at Bhopal had been accounted for by M/s J.L. Kapoor and Sons in its books of account or not. We, therefore, direct the petitioner to appear before his assessing authority at Amritsar on 10-3-2003, at 10.30 A.M. along with the books of account including the stock register and such other evidence which he may like to produce before the assessing authority. The assessing authority will examine the books of account and other material that may be produced before him and record a finding whether the jewellery seized from Rajiv Kapoor which is presently lying, at Bhopal, has been accounted for or not. In case the assessing authority comes to the conclusion that the jewellery has been accounted for, he shall pass an order releasing the same forthwith. In case such an order is passed, the concerned Commissioner of Income Tax at Bhopal will release the jewellery forthwith to the representatives of the petitioner."
4. In the purported compliance of the direction given by the High Court, the Assistant Commissioner of Income Tax, Circle-2 Amritsar (hereinafter referred to as respondent No. 2) passed order dated March 20/21, 2003 (Annexure P-20) declaring that the entries contained in the stock register are not authentic and genuine.
5. The petitioner then filed Civil Miscellaneous No. 9904 of 2003 in C.W.P. No. 18844 of 2002 for issuance of a direction to the respondents to release the jewellery seized at Bhopal. The same was dismissed by the court on 23-5-2003 with liberty to the petitioner to avail appropriate legal remedy against the order passed by respondent No. 2. This is the background of the present writ petition in which the petitioner has prayed for quashing of order dated March 20/21, 2003 and for issuance of a writ in the nature of mandamus for release of the jewellery.
6. We have heard Shri Salil Kapoor, counsel for the petitioner and Shri N.L. Sharda learned counsel for the respondents and have carefully gone through the documents produced by the parties. In our opinion the impugned order is liable to be quashed because while deciding the question relating to release of the jewellery, respondent No. 2 failed to consider the material produced by the petitioner and gravely erred in appreciating the entries recorded in the stock register. A reading of the impugned order shows that Shri J.P. Bhatia, Advocate had appeared before respondent No. 2 and produced the following documents :
"1. Copy of High Court order as mentioned above.
2. Copy of impounding order.
3. Original affidavit of Shri Om Prakash Mehta, Shri Jagdish Mitter and Shri Atul Mehra.
4. Photo copies of vouchers issued by M/s Mehta Artist Jewellers, M/s. Jagdish Mitter Jewellers and M/s Atul Enterprises.
5. Letter written by Shri K.S. Talwar, ACIT (Inv.) Amritsar to Shri Ajit Sinha, Addl. DIT (Inv) Bhopal.
6. Power of Attorney.
7. Stock register for the period from 1-4-2002 onward along with other books of account."
7. However, without even adverting to any of the documents, respondent No. 2 straightaway concluded that the entries recorded in the stock register are not genuine. He recorded this conclusion on the basis of some over-writings in one of the columns of entries recorded against Sr. Nos. 1, 2, 4 and 5.
8. We have examined the disputed entries and find that the opinion formed by the respondent No. 2 qua the correctness of those entries is based on misreading of relevant para of the stock register. If the officer had bothered to undertake an intensive study of various entries, he would have surely realized that the so called over-writing was irrelevant and insignificant and the figures recorded therein tally with other entries. In view of the above, we hold that the conclusion recorded by the respondent No. 2 that entries recorded in the stock register were not genuine is per se erroneous and the same has the effect of vitiating the impugned order.
9. We are further of the view that failure of respondent No. 2 to consider the documents produced by the Advocate representing the petitioner has resulted in grave failure of justice apart from non-compliance of the directions given by the High Court. Therefore, without going into other points raised by the petitioner, we deem it proper to remand the case to respondent No. 2 with a direction to him to pass fresh order in terms of the directions given by the High Court in C.M.P. No. 18844 of 2002.
10. In the result, the writ petition is allowed. Order Annexure P-20 is quashed with a direction to respondent No. 2 to pass a fresh order within a period of one month from the date of presentation of a certified copy of the order. The petitioner is directed to appear before respondent No. 2 in person or through his Advocate on 25-8-2003 and produce a copy of this order.