Police cannot register FIR against Tax Officers and demand diary seized during search: HC

Case Details: Director General of Income Tax (Investigation) v. Deputy Commissioner of Police, Bengaluru (East Division) - [2021] 133 taxmann.com 54 (Karnataka)

Judiciary and Counsel Details

• • M. Nagaprasanna, J.
  • K.V. Aravind, Adv. for the Petitioner. 
  • Smt. Namitha Mahesh B.G., K. Shashikiran Shetty, Sr. Adv. and Sandeep, Adv. for the Respondent.

Facts of the Case

Income-tax Officers (revenue) conducted search and seizure proceedings under section 132 on the residential premises of the assessee. Several incriminating documents, including a diary, were found and seized. The diary had recordings of various transactions with abbreviations and amounts against each of the abbreviations. At that point in time, the assessee was holidaying in Goa.

Later, the assessee registered an FIR alleging that there was gross violation of the procedure adopted in the search and certain documents that were seized and particularly the diary. The Police issued a notice under section 91 of the Cr.PC directing revenue to hand over the diary. The Police also directed revenue to divulge the names of persons who had conducted the search and seized the documents. Revenue filed the writ petition before the Karnataka High Court, contending that registration of FIR was not maintainable.

High Court Held

The High Court held that section 293 of the Income-tax Act, mandates that no suit shall be brought in any civil Court to set aside or modify any proceeding taken or order made under the Income-tax Act. Further, no prosecution, suit or other proceedings shall lie against the Government or any officer of the Government for any act done in good faith.

The bar that operates under Section 293 is twofold, i.e., no proceedings shall be instituted before a civil court, and no prosecution shall lie against the Government or any officer of the Government for anything done under the Income-tax Act.

Admittedly, the Income-tax Officers perform search and seizure under the Income-tax Act. The bar of divulging any information or document taken into custody during the seizure is available under Section 138(2). In the teeth of the said provision, the registration of the FIR was bad in law, as the recording of FIR against officers of Government, who have performed certain acts of search and seizure under Section 132, cannot be brought to prosecution.

It is rather shocking that the Police wanted only the diary seized during the search, and no other document was sought for investigation. It seems that Police was acting at the behest of the assessee to secure the diary by invoking Section 91 of the Cr.P.C. Accordingly, the writ petition is allowed, and FIR registered against Tax Officers & all further proceedings taken up according to it stand quashed.