Calcutta High Court (Appellete Side)
Md. Nizamuddin vs The State Of West Bengal & Anr on 21 December, 2022
IN THE HIGH COURT AT CALCUTTA
CRIMINAL REVISIONAL JURISDICTION
APPELLATE SIDE
PRESENT:
THE HON'BLE JUSTICE AJOY KUMAR MUKHERJEE
C.R.R. 1802 of 2020
Md. Nizamuddin
Vs.
The State of West Bengal & Anr.
For the Petitioner : Mr. Aneek Pandit
Mr. Priyabrata Mukherjee
Ms. Sonakshi Mitra
Mr. Abhijit Kundu
For the Income Tax Authority : Mr. Vipul Kundalia
Mr. Amit Sharma
Mr. Anurag Roy
Ms. Uweaza Ali
Heard on : 06.12.2022
Judgment on : 21.12.2022
Ajoy Kumar Mukherjee, J.
1. Challenging the order dated 21.11.2020 passed by learned Additional
Chief Judicial Magistrate at Alipore in Pragati Maidan Police Station case no. 3
dated 24.3.2020 under Section 41 of the Code of Criminal Procedure and
Section 379 of the Indian Penal Code, the present application under Section
482 of the Code of Criminal Procedure has been preferred.
2. The petitioner contended that the petitioner was working in the Life
Insurance Corporation of India (LICI) and retired from service on 31.10.2018.
The employer of L.I.C.I. credited Petitioner's retiral and other dues to his Bank
account No. 520301199790971 and petitioner received in the year 2017-2018
from LICI before his retirement a sum of Rs. 11,95,439/- as withdrawal by him
from his provident fund account. Then on retirement on 31.10.2018, the
petitioner received further amount of Rs. 37, 63,455/- on account of gratuity,
commuted pension, leave encashment, PF entitlement etc through his said
bank account of corporation Bank's branch at C.R. Avenue, Kolkata. The
petitioner being income tax assessee has filed income tax return and the
petitioner showed his income tax return for the year 2018-19 to Rs.
41,47,680/- as his total income including his retirement benefits. Out of the
said amount, Rs. 31,36,352 pertains to his exempted income due to gratuity,
commuted pension, leave encashment etc.
3. On 23.3.2020, the petitioner herein had given Rs. 29,08,800/- in cash
out of money accumulated in his residence over a considerable long period
being repaid by his sons, son-in-law and other family members who took
financial help from time to time from him for their business and other personal
requirements and returned the same in cash to him, to one Pritam Das, his
authorised person for the purpose of depositing the said cash money in his
another bank account No. 520101199854870 of the corporation bank at C.R.
Avenue, Kolkata Branch through motorbike of his son and accordingly, said
Pritam Das took the said cash amount of Rs. 29,08,800/- from the petitioner
from his residence and left his home for going to the said bank. Subsequently
the said Pritam Das informed the petitioner that he could not deposit the said
money in the said account due to sudden physical illness of his wife and
petitioner then advised him to look after his wife and to return the said money
to the petitioner on the next date i.e. 24.3.2020. Accordingly, said Pritam Das
along with cousin Rabi Kumar Das was coming to return said money
contained in a jute bag riding the petitioner's son by motorbike and when they
reached Parama Island, the police team inspected the motorcycle on that day
i.e. 24.3.2020 at 5.25 p.m. and found the said cash money in the jute bag
carried by Pritam Das. Petitioner further alleged without making any
investigation whatsoever, police seized the said cash of Rs. 29,08,800/- from
the possession of the said Pritam Das as stolen money and arrested the said
Pritam Das and Rabi Kumar Das from the road along with seized motorcycle
and at that point of time, said Pritam Das said police personnel that said
money belongs to the petitioner herein and it was given to them for depositing
in his bank account but the police personnel did not pay any heed to such
statement and treating the said cash money as "stolen property" registered
Pragati Maidan Police Station Case no. 3 dated 24.3.2020 under Section 41 of
the Code of Criminal Procedure and Section 379 of the Indian Penal Code
against the said Pritam Das and Rabi Kumar Das. The petitioner and his son
subsequently went to Pragati Maidan Police Station on getting information of
such arrest and repeatedly stated to police personnel that said money
belonging to the petitioner and the petitioner has every document to prove the
ownership of said cash amount and requested to record his statement but the
petitioner alleged that he was ill treated by the police personnel and was
threatened with dire consequence to implicate in money laundering cases.
During investigation, the petitioner submitted all relevant documents to the
police in respect of lawful source of his seized money like income tax return,
bank passbook etc.
4. Later on said Pritam Das got a notice on 2.6.2020 from the income tax
department to submit his reply as per requirement of the said notice and
accordingly said Pritam Das sent his reply on 4.6.2020. Subsequently the
petitioner herein was also served with a similar notice on 28.7.2020 through
E-mail to submit his documents and accordingly, the petitioner sent all
relevant documents as desired by the income tax department but the income
tax department has not intimated the petitioner about the result of said
enquiry by the said authority.
5. During investigation, learned Additional Chief Judicial Magistrate called
for investigating officer's report on the point of releasing the said cash amount
as prayed by the petitioner in his application under Section 457 of the Code of
Criminal Procedure, on 6th July, 2020. It is alleged that the Investigating
officer intentionally did not send his opinion as to whether the said money
could be released in favour of the petitioner. The Income tax department raised
objection regarding return of the seized money but in spite of asking income
tax department to submit a report, no report was submitted by the income tax
department. On 20.10.2020, the petitioner's prayer for return of the seized
vehicle was allowed.
6. The petitioner further submits that the income tax department has not
filed any written application whatsoever for getting the seized money from
learned court's custody while the petitioner's application under Section 457 of
the Code of Criminal Procedure was lying pending since 6 th July, 2020 before
the court below. Ultimately on 21.11.2020, vide impugned order the learned
court below was pleased to reject the prayer made by the petitioner with regard
to return of seized cash amount of Rs. 29,08,800/- without giving any hearing
of the petitioner's petition dated 16.9.2020 challenging the locus standi to
oppose petitioner's prayer for return by PP/APP or learned Advocate on behalf
of the Income Tax department.
7. Being aggrieved and dissatisfied with the aforesaid order dated
21.11.2020 passed by the learned Additional Chief Judicial Magistrate, Alipore
rejecting the aforesaid prayer made by the petitioner, under Section 457 of the
Code of Criminal Procedure, the present application under Section 482 of the
Code has been preferred.
8. Learned advocate for the petitioner submits that the court below wrongly
held that power conferred under Section 457 of the Code is discretionary
power upon the court with respect to the disposal of seized property during
investigation. The learned court below ignored the settled principle of law as
enunciated by different High Courts and Supreme Court. The petitioner further
submits that the income tax department cannot intervene in the disposal of
the petitioner's petition under Section 457 of the Code for releasing the cash
money to the petitioner on the ground that income tax act is a special statute.
Income tax department was not a contesting party in that case and learned
court below wrongly applied the principle laid down in Section 451 of the Code
which deals with the situation during inquiry or trial and not during
investigation. The police investigating agency could not prove that the seized
money is stolen property and income tax department never seized money
under the Income Tax Act, 1961 and it was seized by police and this aspect
was ignored by the learned court. The learned court below should have applied
his judicial mind not in a cavalier manner and mechanical method. The
income tax department has no authority to seize the money by any stretch of
imagination.
9. The petitioner in order to support his claim relied upon the following
documents:
i) Income Tax Returns Rs. 12,46,477/-
for the year 2016-
ii) Income Tax Returns Rs. 10,89,012/-
for the year 2018-
iii) Income Tax Returns Rs. 41,48,796/-
for the year 2019-
iv) Pass Book entries Rs. 31,38,121/-
showing balance as on
09.02.2020
v) Pass book entries Rs. 31,00,000/-
dated 11.02.2020
showing withdrawal of
cash
vi) Pass Book entries
showing major
withdrawal
10. The petitioner submit further that by the aforesaid documents he has
prima facie shown his source of income as well as the withdrawal of cash from
lawful and accounted income to the tune of Rs. 31,00,000/-. But by the
impugned order, learned court below was pleased to reject the petitioner's
prayer for return of the seized money in favour of the petitioner and was
pleased to held that the seized cash cannot be handed over to the petitioner at
this stage and the same should instead, be hand over to the income tax
department. Accordingly, the learned court below directed the State
investigating agency to hand over the seized cash as per seizure list to the
authorized representative of the income tax department after due verification
and identification and after preparation detailed panchnama of the currency
notes.
11. Learned advocate for the opposite party no. 2 by filing affidavit-in-
opposition contended that in spite of getting adequate opportunity given by the
income tax department to explain the source of seized cash amounting to Rs.
29,08,800/-, no satisfactory explanation has been provided by the petitioner
and the same remained unexplained. Since the source of cash is not explained
and during investigation and verification of documents placed by the
petitioner, it was found that said cash amount of Rs. 29,08,800/- is
unaccounted income, the same is required to be handed over to the income tax
department under Section 132A of the Income Tax Act, 1961 to proceed
further with the matter. It is not correct that the pass book entries dated
11.02.2020 shows that cash amounting to Rs. 31,00,000/- was withdrawn
from the bank account of the petitioner. The income tax return for assessment
year 2016-17, 2018-19 and 2019-20 do not show the source of seized cash
amounting to Rs. 29,08,800/- or that the same is accounted money of the
petitioner. The transaction in connection with pass book of the Union Bank of
India having account no. 5201011999790971 dated 11.2.2020 of Rs.
31,00,000/- are not the cash withdrawal instead the said entry dated
11.2.2020 is pertaining to RTGS transfer made to other account of the
petitioner in the same bank having account no. 520101199854870. The
Opposite party no. 2 further submits that regarding transaction/entry made
on 11.2.2020 from the said account of the petitioner, they have made query to
the said bank and they also satisfied with the aforesaid transfer of
Rs.31,00,000/- from petitioner's one bank to other bank account through
RTGS. In fact, no cash withdrawal has been made by the petitioner and as
such the petitioner's claim of cash withdrawal of Rs. 31,00,000/- is incorrect
and far from the truth. On the contrary on perusal of bank statement it
transpires that there were various small ATM self withdrawal amounting to Rs.
10,000/- from the bank on different occasions. Such small withdrawals do not
establish seized cash amounting to Rs. 29,08,800/- have been withdrawn from
the bank account of the petitioner. The small withdrawal on different
occasions of about Rs. 10,000/- do not establish the said cash withdrawal of
three financial years i.e. 2017-18 to 2019-20 is the cash in hand or that is the
actual source of seized cash. The said small withdrawals may be made for the
purpose of meeting daily basic expenditure. Even if the expenditure was not
done, then the source of expenditure for three financial years is to be
explained, which was not explained by the petitioner, before the income tax
department. The opposite party no. 2 also denied that the petitioner is a bona
fide tax payer or that money in his possession is accounted money or disclosed
in the return of income filed by the petitioner. It is incorrect to say that said
seized cash amounting to Rs. 31,00,000/- was withdrawn from his bank
account prior to 9.2.2020. The withdrawal of small amount from ATM has also
been mentioned as per following chart:
Date Amount in Rupees
01/09/2017 10,000.00
09/10/2017 10,000.00
15/11/2017 10,000.00
01/01/2018 10,000.00
01/01/2018 10,000.00
29/01/2018 10,000.00
31/01/2018 10,000.00
09/02/2018 10,000.00
28/03/2018 10,000.00
13/04/2018 10,000.00
19/04/2018 10,000.00
24/04/2018 10,000.00
10/05/2018 10,000.00
09/02/2018 10,000.00
01/09/2017 10,000.00
12. It is further submitted on behalf of opposite party No. 2 that the
petitioner's statement made in supplementary affidavit in different paragraphs
are contradictory and inconsistent in as much as in one hand, the petitioner
contends that seized cash was withdrawn on 11.2.2020 from his bank account
and on the other hand, he contends that said seized cash were withdrawn
prior to lock down on 9.2.2020, the said contradictory statements negate claim
of the petitioner and proves that the said seized cash amounting to
Rs.31,00,000/- is unaccounted money of the petitioner and accordingly
proceeding has to be initiated against the petitioner in accordance with law by
the income tax department, which they could not do due to grant of stay by
this court.
13. In the present case, admittedly the money was seized not from the
petitioner but from one Pritam Das and Rabi Kumar Das. The petitioner
contended that they are his employee but no such document furnished in
respect of the same, nor the aforesaid persons had filed any income tax return.
In fact, when the learned Magistrate called for a report from investigating
agency about the petitioner's prayer for return of the seized money, the
investigating agency raised objection by their report dated 24.3.2020. It
appears that in the letter dated 17.8.2020, the investigating agency
recommended for seeking direction from the Magistrate to hand over
possession of the seized cash to the income tax department as the claim of
Pritam Das that the seized cash amount of Rs.29,08,800/- belongs to
petitioner herein is doubtful and his statements are contradictory and Pritam
Das does not file income tax return. Moreover it was further noted in the
correspondence that the seized cash amount cannot be construed as
consisting of various cash withdrawals spanning in three financial years from
the bank account of the petitioner and the said amount does not consist of
gratuity, pension or leave encashment receipt of the petitioner. Moreover, it
was further noted that the petitioner furnished unsigned copies of documents
which are not reliable and did not furnish any documents showing TDS on the
salary payment made to his said employee, Pritam Das. On the contrary the
petitioner herein has shown huge unsecured loan in the financial year 2019-
20, source of income of which is not established and it is further noted that
the petitioner has fabricated/manipulated story to cover up the unaccounted
money.
14. Section 457 of the Code of Criminal Procedure provides that when a
property is seized during investigation and when the person who is entitled to
get the said property is known, the possession should be handed over to such
person who is entitled to possession and if such person cannot be ascertained
respecting the custody and production of such property but when there is
serious controversy as to the person entitled to the delivery of such property,
law does not require the Magistrate to finally adjudicate upon the said
controversy. In the present case, the said investigating agency at first has
taken up the investigation and later on as reported by the said investigating
agency, the income tax department is also processing for proceeding for
enquiry in the aforesaid seized money. When there is allegation and counter
allegation and when it is still the subject matter of enquiry by the concerned
authority that is the income tax department as to whether said money is
accounted money or not, I find that the Magistrate was justified in passing the
impugned order as enquiry has not yet been completed. It is submitted that
due to stay order granted by this court, the income tax authority could not
proceed for the enquiry or investigation by taking custody of the said property.
The expression "entitled to possession" would normally mean lawful or rightful
title to hold the property. When the other enquiry authority on a preliminary
enquiry came to a finding that prima facie the petitioner has failed to show
that the money seized by the said police investigating agency is accounted
money, ultimate finding of the order impugned does not call for any
interference at this stage. However this order will not preclude the petitioner
from making similar prayer for return of seized money on furnishing
appropriate bond at a subsequent stage after completion of
investigation/enquiry and if such prayer is made, such application shall be
disposed of in accordance with law.
15. Accordingly, CRR 1802 of 2020 is accordingly disposed of.
16. However, the income tax authority is directed to conclude their entire
proceeding within a period of six months from taking change of seized
property.
Urgent photostat certified copy of this order, if applied for, be given to the
parties upon compliance of all requisite formalities.
(Ajoy Kumar Mukherjee, J.)
