Patna H.C : The hearing of these cases was taken up after disposal of Civil Appeals Nos. 304-35 of 1997, preferred in the Supreme Court against the orders dt. 31st Nov., 1996, and 19th Dec., 1996, passed by this Court.

High Court Of Patna

Sushil Kumar Modi & Ors. vs. State Of Bihar & Ors.

Sections 245D(3), 245D(6)

S.N. Jha & S.J. Mukhopadhaya, JJ.

C.W.J.C. No. 1617 of 1996

3rd February, 1997

Counsel Appeared

Basant Kumar Choudhary & P.K. Shahi, for the Petitioners in CWJC No. 602 of 1996 & Ravi Shanker Prasad, for the Petitioners in CWJC No. 1617 of 1996 : Rakesh Kumar, for the CBI : Shashi Anugrah Narain, Addl. A.G. II, with Subhash Chandra Jha, Addl. A.G. II, for the State : L.N. Rastogi & S.K. Sharan, for the Respondents

JUDGMENT

BY THE COURT :

The hearing of these cases was taken up after disposal of Civil Appeals Nos. 304-35 of 1997, preferred in the Supreme Court against the orders dt. 31st Nov., 1996, and 19th Dec., 1996, passed by this Court.

The Supreme Court in its order dt. 24th Jan., 1997, has held that the nature of proceedings before the High Court is somewhat similar to those pending in the Supreme Court in Writ Petition (Crl.) Nos. 340-343 of 1993—Vinit Narain vs. Union of India and Writ Petition (Civil) No. 640 of 1995—Anukul Chandra Pradhan vs. Union of India, and, therefore, the High Court is required to proceed with the matter in a similar manner and on the same lines. At another place, the Supreme Court has observed that keeping in view the nature of the proceedings and the manner in which the exercise is to be performed to ensure performance of its duty by the CBI, guidance through counsel for the CBI could have been given by the High Court without entering into the merits of any of the accusations. There is a controversy between the parties regarding the import and interpretation of the above mentioned portions of the orders of the Supreme Court. We would like to hear the parties on the point on the next date.

The parties are directed to file affidavits indicating their respective stand within two weeks after serving copies thereof on the other side. On 11th Dec., 1996, the Director, CBI, had given undertaking that investigation into the conspiracy aspect of the case shall be completed within a period of three months. We hope, the aforesaid time schedule shall be adhered to.

An interlocutory application (IA No. 270 of 1997) has been filed on behalf of the IT Department seeking clarification of the orders dt. 13th Nov., 1996, and 19th Dec., 1996. Mr. L.N. Rastogi, standing counsel for the IT Department, submitted that in the light of the abovesaid orders request was made to the Income-tax Settlement Commission (Addl. Bench), Calcutta, to reopen certain disposed of proceedings relating to the assessees involved in the animal husbandry scam in terms of the provisions of s. 245D(6) of the IT Act, 1961. The Settlement Commission, however, has expressed its inability to deal with the request on the ground of pendency of the present proceedings in the High Court. We would clarify that pendency of these proceedings do not stand in the way of the Settlement Commission taking action/passing orders under s. 245D(6) as may be considered fit and appropriate. In fact, that would be in consonance with the spirit of the abovesaid orders of this Court.

Mr. Rastogi has next pointed out that a request was made to the Commission to hold enquiry into cases which have been admitted by the Settlement Commission under s. 245D(1) of the IT Act at Patna. It is said that in view of the volume of records and also for security reasons, as there is a danger to the records be destroyed/tampered with in the course of transit, it may not be in the interest of the Department to send the bulk of records to Calcutta. The Commission, however, by its letter dt. 6th Jan., 1997, has turned down the request and directed the CIT, Patna, Bihar, to send the records to the Addl. Director of Investigation I, Calcutta. It is said that as many as 22 cases are pending at this stage of s. 245D(1). Mr. Rastogi submitted that if it is not possible for the Settlement Commission to hold its sitting at Patna, it may entrust the enquiry to the Chief CIT, Bihar, under s. 245D(3) of the Act.

We find that the power conferred on the Settlement Commission regarding entrustment of enquiry to the CIT under s. 245D(3) is discretionary in nature. We have doubts if we can give any positive direction to the Commission in this regard. We would, however, having regard to the significance of these cases, the amount involved, etc., like to know the response of the Commission in this regard.

Let notice be issued to the Income-tax Settlement Commission (Additional Bench), 16B, Rowland Road (5th floor) Calcutta-700 020, returnable within two weeks. Notice shall go through the CIT, Bihar, along with a copy of the interlocutory application. In the meantime, it will be open to the Commission to act on its own in terms of the provisions of s. 245D(3) of the Act.

These matters will be on the list next on 21st Feb., 1997. Both the CBI and the IT Department shall file their reports on 20th Feb., 1997.

[Citation : 233 ITR 671]

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