High Court Of Delhi
Ashok Kumar Aggarwal vs. Director (Grievance Cell), CBDT & Ors.
Section 132B, ART. 226
B.C. Patel, C.J. & Badar Durrez Ahmed, J.
Writ Petn. No. 2721 of 1992
25th November, 2004
Counsel Appeared
B.N. Goswamy, for the Petitioner : Sanjiv Khanna with Ajay Jha, for the Respondents
JUDGMENT
B.C. Patel, C.J.:
The petitioner has approached this Court by filing a writ petition under Art. 226 of the Constitution of India, inter alia, praying that the respondents be directed to pay interest on Rs. 6,49,250 from 25th Oct., 1985 to 9th April, 1990, which is the date of refund of the amount, at the rate of 15 per cent per annum, and further interest on the above amount of Rs. 6,49,210 at the rate of 15 per cent from 9th April, 1990 till the date of payment.
The assessee was searched at Bombay Airport and on his person a sum of Rs. 9,80,000 was found and seized by the IT authorities on 4th April, 1984. In view of this seizure and the provisions contained in s. 132 of the IT Act, 1961 (hereinafter to be referred as “the Act”), an order was made under s. 132(5) of the Act on 4th July, 1984. The order could have been challenged by the petitioner under sub-s. (11) of s. 132 of the Act. However, the order was accepted and no challenge was made thereto. It appears that on 25th Oct., 1985, the AO completed the assessment and made the assessment order and held that the petitioner concealed the income and the entire amount of Rs. 9,80,000 seized from the person of the assessee was considered as concealed income. Sec. 132B of the Act, as applicable, is required to be examined and the same is reproduced as under :
“132B. Application of retained assets.—(1) The assets retained under sub-s. (5) of s. 132 may be dealt with in the following manner, namely:
(i) The amount of the existing liability referred to in cl. (iii) of the said sub-section and the amount of the liability determined on completion of the regular assessment or reassessment for all the assessment years relevant to the previous years to which the income referred to in cl. (i) of that sub-section relates (including any penalty levied or interest payable in connection with such assessment or reassessment) and in respect of which he is in default or is deemed to be in default may be recovered out of such assets. (ii) If the assets consist solely of money, or partly of money and partly of other assets, the AO may apply such money in the discharge of the liabilities referred to in cl. (i) and the assessee shall be discharged of such liability to the extent of the money so applied. (iii) The assets other than money may also be applied for the discharge of any such liability referred to in cl. (i) as remains undischarged and for this purpose such assets shall be deemed to be under distraint as if such distraint was effected by the AO or, as the case may be, TRO under authorisation from the Chief CIT or CIT under sub-s. (5) of s. 226 and the AO or, as the case may be, TRO may recover the amount of such liabilities by the sale of such assets and such sale shall be effected in the manner laid down in the Third Schedule. (2) Nothing contained in sub- s. (1) shall preclude the recovery of the amount of liabilities aforesaid by any other mode laid down in this Act. (3) Any assets or proceeds thereof which remain after the liabilities referred to in cl. (i) of sub-s. (1) are discharged shall be forthwith made over or paid to the persons from whose custody of the assets were seized. (4)(a) The Central Government shall pay simple interest at the rate of fifteen per cent per annum on the amount by which the aggregate of money retained under s. 132 and of the proceeds, if any, of the assets sold towards the discharge of the existing liability referred to in cl. (iii) of sub-s. (5) of that section exceeds the aggregate of the amounts required to meet the liabilities referred to in cl. (i) of sub-s. (1) of this section. (b) Such interest shall run from the date immediately following the expiry of the period of six months from the date of the order under sub-s. (5) of s. 132 to the date of the regular assessment or reassessment referred to in cl. (i) of sub-s. (1) or, as the case may be, to the date of last of such assessments or reassessments.”
We called upon the petitioner to show us any order of appropriation. However, it was stated that no specific order was made for appropriation. We put a specific question as to whether any application was made by the assessee to the appropriate authority under s. 132B(3) for return of the amount or the articles in view of the said provision. There is no application made in this behalf. It may be noted that under the provision, it is the duty of the AO to return the amount forthwith and it is this omission which is challenged in this petition.
It is also required to be noted that the assessee preferred an appeal against the order made by the AO dt. 25th Oct., 1985 and the CIT(A) set aside the order made by the AO on 4th July, 1986 and thus deleted the addition of Rs. 9,80,000 which included the seized amount. Even after this order, the assessee did not approach the Court for appropriate relief. It is further required to be noted that the Revenue appealed to the Tribunal against the order made by the CIT(A). However, that is not relevant to the issue before us. In the absence of any order indicating that the AO was restrained from releasing the seized amount, it cannot be urged that the assessee should be assisted by the Court, though there is an inordinate delay on his part.
It is also required to be noted that the amount was ultimately returned on 9th April, 1990 in view of the order made by the Asst. CIT (Investigation), Circle 15(1), New Delhi, and the assessee was allowed interest from 4th Jan., 1985 to 25th Oct., 1985, i.e., the period prescribed under s. 132B (4)(b) of the Act. Therefore, the order made is in consonance with the provisions contained in s. 132B(4)(b) of the Act. The petitioner could have approached the Court after the assessment order was made or after the CIT(A) decided the appeal in his favour on 4th July, 1986. He kept quiet and approached this Court only in 1992. Even thereafter, the petitioner never bothered to see that the matter is taken up for admission. It is only when the Registry was called upon to trace the old matters which were lying in the Registry, this matter was brought to the notice of the Court. There is an order made by this Court on 8th Jan., 1993 to the effect that the matter be listed for arguments on 1st March, 1993. The Division Bench passed this order possibly in view of the fact that none remained present. Even on the next date, i.e., 1st March, 1993, the petitioner did not bother to remain present and, therefore, the Division Bench hearing the matter passed an order as under : “List the matter on the request of the counsel.”
That request was not made by the counsel for the petitioner till date and it is only in view of the exercise undertaken by the Registry that this matter is placed before the Court for admission.
6. In view of the provisions contained in s. 132(5) and (11) of the Act and as also in view of s. 132B of the Act, it is clear that though there was a right in favour of the petitioner, he had not approached the Court within a reasonable period. The right to return of the article accrued on 25th Oct., 1985 or latest on 4th Oct., 1986 and he ought to have approached the Court within a reasonable period from that date. It is clear that when he has approached this Court in 1992, 7 years later, it cannot be said that it is within a reasonable period. Therefore, on the ground of delay and laches we are not inclined to entertain this petition. Hence, the writ petition is dismissed.
[Citation : 279 ITR 161]
