C/SCA/20532/2015 JUDGMENT IN HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION NO. 20532 of 2015 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MR.JUSTICE BIREN VAISHNAV 1 Whether Reporters of Local Papers may be allowed to see judgment ? 2 To be referred to Reporter or not ? 3 Whether their Lordships wish to see fair copy of judgment ? 4 Whether this case involves substantial question of law as to interpretation of Constitution of India or any order made thereunder? INCOME TAX OFFICER (INVESTIGATION)....Petitioner(s) Versus DEPUTY SUPERINTENDENT OF POLICE & 2....Respondent(s) Appearance: MRS MAUNA M BHATT, ADVOCATE for Petitioner No. 1 MR PRANAV TRIVEDI, AGP for Respondent No. 1 MR RK PATEL, WITH MR. DARSHAN R PATEL ADVOCATE for Respondents No. 2 - 3 CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MR.JUSTICE BIREN VAISHNAV Date : 09/08/2017 ORAL JUDGMENT Page 1 of 5 HC-NIC Page 1 of 5 Created On Sat Sep 09 11:09:44 IST 2017 C/SCA/20532/2015 JUDGMENT (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. This petition is filed by Income Tax Department to challenge order dated 07.11.2015 passed by Deputy Superintendent of Police, Modasa. Brief facts are as under: 2. On 04.11.2015, police authorities intercepted Ford Fiesta car on Shamlaji-Himmatnagar highway and found that there were two passengers in car, respondents No. 2 and 3 and, in car, they were carrying cash amount of Rs. 1.40 crores. police authorities therefore, seized vehicle, said cash amount and other valuables such as mobile phones etc. of occupants of car under seizure memo. case of occupants was that they were employees of Angadia firm and cash belonged to angadias and was withdrawn from bank accounts and was therefore, wrongly seized by police authorities. application for release of cash was filed before Judicial Magistrate, Modasa. Simultaneously, application was also moved before police authorities for release of cash. 3. On 04.11.2015 itself, police authorities had informed Income Tax Department about seizure of cash. On 06.11.2015, Police Inspector, Modasa (Rural) sent fax message to Income Tax Officer, Ahmedabad, conveying that angadias have contended that cash amount is withdrawn from different branches of their bank. They also produced supporting documents. This amount was needed Page 2 of 5 HC-NIC Page 2 of 5 Created On Sat Sep 09 11:09:44 IST 2017 C/SCA/20532/2015 JUDGMENT looking to ensuing Diwali vacation. angadias have moved application before learned Magistrate on 05.11.2015 for release of cash which was fixed for hearing on 06.11.2015. He, therefore, requested that responsible officer of Income Tax Department will be deputed to remain present before Magistrate. 4. On 06.11.2015 itself, department had issued summons to respondent Nos. 2 and 3 to remain present before authority on 16.11.2015 to give evidence or to produce documents. On 07.11.2015, Income Tax Officer applied to learned Magistrate not to release cash on ground that Income Tax Department has initiated proceedings under section 132 of Act. cash can, therefore, be released only by department. 5. Case of department is that ignoring such pleas, Deputy Superintendent of Police, Modasa, passed order dated 07.11.2015 releasing cash on certain terms and conditions. Counsel for department submitted that action of said officer was needlessly hasty when department is looking into source of cash, there was no reason why same should have been released without awaiting of outcome of such inquiry. department had issued notices to persons, from whom cash was seized, to appear and produce documents so that proper view could have been taken. Page 3 of 5 HC-NIC Page 3 of 5 Created On Sat Sep 09 11:09:44 IST 2017 C/SCA/20532/2015 JUDGMENT 6. On other hand, learned counsel Mr. R.K.Patel for private respondents submitted that source of cash was well explained. amount belonged to Angadia firm. It was withdrawn from different bank accounts. Full disclosure was made before Assessing Officer where scrutiny assessment has been undertaken. In any case, police authorities had no power to withhold cash when even prima facie no offence was disclosed. He pointed out that no FIR was registered. Only entry for information was recorded. 7. From materials on record, it can be seen that Income Tax Department has not issued any requisition with respect to cash in question under section 132A of Act. Under clause (c) of sub-section (1) of Section 132A, it is open for competent authority if he has reason to believe that any assets represent either wholly or in part income or property which has not been, or would not have been disclosed for purpose of Act by any person from whose possession or control such assets have been taken into custody by any officer or authority under any other law for time being in force, he may require officer or authority to deliver such asset to requisitioning officer. When no such requisition was made, police authority had no business to withhold cash, if same was not required for police parties and could not have been withheld under powers of Criminal Procedure Code. So far as police is concerned, when it was convinced that such amount was not involved in any illegal activity nor any Page 4 of 5 HC-NIC Page 4 of 5 Created On Sat Sep 09 11:09:44 IST 2017 C/SCA/20532/2015 JUDGMENT offence was registered against occupants of car or any other person which may have link to such cash, said authority had no reason to, in fact, no power to withhold such amount. It was always open for competent authority acting under section 132A of Act to requisition such amount, if conditions contained therein were not satisfied. However, without any such requisition, it was not open to ask police authorities not to release amount which said authorities otherwise did not require to withhold. 8. Even otherwise, while releasing amount, Deputy Superintendent has imposed certain conditions one of them being that, if and when Income Tax authorities required persons from whom amount was seized to appear and produce amount, they would do so. 9. Under circumstances, this petition is dismissed. (AKIL KURESHI, J.) (BIREN VAISHNAV, J.) Jyoti Page 5 of 5 HC-NIC Page 5 of 5 Created On Sat Sep 09 11:09:44 IST 2017 Income-tax Officer (Investigation) v. Deputy Superintendent of Police & 2