The Delhi High Court quashed the petitions challenging validity and legality of the search action initiated by the Income Tax Officials and held that the Search is justified on failure of the Assessee to furnish details of contents of the locker.
The petitioners, Shilpa Chowdhary and Vikas Chowdhary are wife and husband, by way of separate writ petitions challenging the validity and legality of the search action initiated by the Respondent authorities.
They sought to quash of the impugned Warrant of Authorization (WoA); a declaration that the search and seizure, conducted on them is illegal, void, and without the authority of law, and the exercise is without jurisdiction; direction to the Respondents to release the entire material and valuables seized under the search action; and quashing of the notices issued under Sections 153A or 143(3) of the Income Tax Act, 1961.
Mr. Vikas Chowdhary denied having any bank locker. However, Shilpa Chowdhary, while admitting the existence of the locker, did not give any information relating to its contents.
There was indeed material with the concerned authority to form reasons to believe that the locker contained any articles or cash or jewellery or other materials which represented the undisclosed income of the Petitioner. The satisfaction arrived at by the authority meets the conditions stipulated in Clauses (b) / (c) of Section 132(1) of the Act.
The division bench of Justice Manmohan and Justice Sanjeev Narula noted that the impugned WoA against the Petitioners has been issued not merely on the ground of recovery of locker key, as Mr. Srivastava has sought to project. The formation of belief by the authorities is also based on the statements of the Petitioners.
It was further noted that the satisfaction note also records that Petitioners were asked to furnish details of the contents of the locker, but did not provide satisfactory explanation.
In these circumstances, the court held that the Revenue was well within its right to proceed to search the Petitioner’s locker under section 132(1) of the Act.
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