Kamal Khosla And Anr. vs Director Of Income-Tax ...
2002 Latest Caselaw 910 Del

JUDGMENT

Vikramajit Sen, J.

1. We have heard learned counsel for the petitioner at length. The prayers in the petition are : (a) that the search and seizure proceedings initiated under Section 132 of the Act may be declared as illegal and invalid ; (b) that the entire seized material including the cash of Rs. 1,40,000 may be ordered to be released forthwith ; (c) that the cash amounting to Rs. 2,80,000 extorted by the search party may be ordered to be returned to the petitioners forthwith ; (d) that the restraint order under Section 132(3) in respect of the premises at 605, Hemkunt Tower, 6, Rajendra Place, New Delhi, may be directed to be withdrawn by the respondents forthwith and the seals be removed to enable the petitioners to resume their business ; (e) that due cost and compensation may be suitably awarded to the petitioners for all the harassment and hardships caused to them by the respondents ; and (f) that any other order or direction may be passed in favor of the petitioners as it may deem fit and proper.

2. However, in the course of arguments Mr. Bajpai additionally prayed that the petitioner be permitted to amend the petition in order to implead the Central Bureau of Investigation and that directions be issued to the Central Bureau of Investigation to complete their investigation expeditiously. We find no justification in enlarging the scope of the present petition and virtually monitoring the activities of the Central Bureau of Investigation. This is additionally so for the reason that no allegations against the Central Bureau of Investigation have been articulated in the petition. The impression that we have gathered from the submissions made by Mr. Bajpai is that the Central Bureau of Investigation is proceeding in the matter with diligence and dispatch. In fact it appears that an FIR has already been registered on May 14, 2000, against Shri Rajesh Sharma and Shri Gupta both of whom are the inspectors in the Income-tax Department involved in the subject search. Prayer (c) mentioned above, as also the prayers additionally made before us in the course of arguments, are palpably precipitate, and are rejected as such. The Central Bureau of Investigation must be left to investigate the complaint unhindered by this court.

3. The gravamen of Mr. Bajpai's argument is that the search and seizure should be declared illegal and invalid for the reason that it was directed and intended for altogether different parties, namely, Ramesh Kalra, Joan Kalra, Arun Kalra, Ashwani Kalra and Smt. Sunita Kalra. The submission is that the petitioners, namely, S/Shri Naval Khosla and Kamal Khosla, are not connected with the business of the Kalras. It is also his submission that the authorisation under Section 132 did not extend the search and seizure operation pertaining to the petitioners' premises and property ; and that their names and premises had been added in the duration of the search. In this regard the original files pertaining to this exercise, coded as "Operation Desert Fox", were produced before us for our perusal. There is not even an iota in support of the allegations made by Mr. Bajpai on behalf of the petitioners. From a reading of the file presented to us by learned counsel for the respondents, from the inception the petitioners were inherently within the contemplation of the respondents, even prior to the search, as their activities were considered as intricately connected with the business of the Kalras.

4. Mr. Bajpai contended that the inspectors had acted in an illegal manner in demanding the said sum of Rs. 2,80,000. Without in any way reflecting upon the merits of this accusation, even though transcripts of some tape recorded conversations have been produced, these events even if they are assumed to be correct, would not directly affect the legal propriety of the search and seizure under Section 132 of the Income-tax Act. The latter proceedings would not be invalidated because of a subsequent illegal action. As we see it, the allegations pertaining to the alleged bribe of Rs. 2.80 lakhs have been impressed upon us in an effort to prejudice the search and seizure carried out by the respondents.

5. The search emanated from the complaint filed by a group of persons alleging that R. K. International are extorting large sums of money in the name of sending people abroad. They are charging from Rs. 40 thousand to Rs. 70 thousand and sometimes even Rs. 80 thousand per person for sending them abroad for job. Kamal Khosla in his statement confessed that the figure of Rs. 40 thousand and Rs. 70 thousand are not recorded in the books of account but are recorded in the range of Rs. 1,500 to Rs. 5,000 only. Kamal Khosla also mentioned that this practice is going on for about four years.

6. It has next been contended that the seizure of Rs. 1,40,000 is in violation of Section 132(3) of the Income-tax Act for the simple reason that it was not concealed income and has been duly reflected in the books of account maintained by the petitioners. Mr. Khanna, learned counsel for the respondents, has taken us through the interrogation conducted in the case. On a reading thereof, prima facie, it appears that the contention of the petitioners is not correct that adequate evidence had been shown to the respondents that the said sum was duly accounted for. On the fateful day of the search, i.e,. May 9, 2002, the petitioners undertook to produce books of account pertaining to R. K. International and Khosla Transport Co. by 4 p.m. However, the same could not be produced by the petitioners until 7.40 p.m. Thereafter, the petitioners mentioned that the books of account are lying with the chartered accountant, Kamal Gupta. The respondents examined Kamal Gupta, C. A. He stated that the accounts for the year March 31, 2002, are under compilation/finalisation. It has been vehemently contended by Mr. Sanjiv Khanna, learned counsel appearing on behalf of the respondents, that the statement of accounts annexed to the petition has been prepared later on, and does not truly reflect the financial state of affairs of the petitioners. Mr. Bajpai has countered the submission by stating that the Department could very well have obtained the accounts from the hard disc of the computers which have been in their possession since that date. Even if that be true it cannot be said that the Department did not give adequate opportunity to the petitioners to prove that the said sum of Rs. 1,40,000 was legitimately accounted for. At this stage, it is not possible for this court to arrive at the conclusion that the stand adopted by the petitioners is unimpeachable. It is thus not possible at this stage to grant the relief claimed for by exercising the extraordinary powers under article 226 of the Constitution of India.

7. Normally, we would have preferred not to enter into details to the extent that we have done so as not to prejudice the case of the petitioners. This has, however, been necessitated because of the specific request made by counsel for the petitioner.

8. The writ petition is without merit and is dismissed.