Allahabad High Court-Lucknow Bench
Court No. - 3 

Case :- MISC. BENCH No. - 8153 of 2015 

Petitioner :- Smt. Lalli Bajpai & 3 Others 
Respondent :- Principal Commissioner Of Income Tax (Central Circle)& 2 Ors 

Counsel for Petitioner :- Rohit Nandan Shukla 
Counsel for Respondent :- Ghanshyam Chaudhary 

Hon'ble Shri Narayan Shukla,J. 
Hon'ble Akhtar Husain Khan,J. 

Heard learned counsel for the petitioner as well as learned counsel for the respondents.

During search and seizure operation made under Section 132 of the Income Tax Act, 1961, savings bank account no.1852000100114313 of the petitioner no. 1 existing at Punjab National Bank, Banthara, Lucknow has been attached and the amount of cash Rs.1,37,95,000/- available in the bank account has been seized on 25.02.2013.
 
Learned counsel for the petitioners has submitted that under the assessment proceeding, the liability as has been assessed by the Assessing Officer is Rs. 88,01,189/- for different assessment years and accordingly the total demand of Rs. 88,01,189/- has been created against the petitioners, however, they have possessed the amount of Rs. 1,37,95,000/- from the saving bank account no.1852000100114313. Learned counsel for the petitioners has further submitted that under the provisions of Section 132-B of the Income Tax Act, the Assessing Officer is under statutory liability to release the balance amount, however, the period as has been prescribed in the Act has expired but till date no balance amount has been released to the petitioner. The petitioners have also represented to the Commissioner of Income Tax (Central Circle), Lucknow for release of the amount on 15.05.2015 and 18.06.2015 but no attention has been paid on the petitioners' representation. 

In reply, Mr. Manish Mishra, learned counsel for the Revenue has submitted that Central Board of Direct Taxation (CBDT) has issued instructions, which is numbered as Instruction No. 11/2006 dated 01.12.2006. Under the Instructions, it has been provided that the cash deposited in PD account is to be dealt with the following manner: 

"I. .... 

II. The amount lying in PD A/c should be released within one month of passing of the assessment order after adjusting the seized cash against any existing liability and the amount of liability determined on completion of search assessment and in case penalty proceedings are initiated, retaining an amount to meet the expected liability on account of penalty imposable." 

In light of the aforesaid provisions, he urged that under the CBDT Instruction, the respondents have right to retain the amount to meet the penalty imposable and the proceeding for imposition of penalty is pending consideration for the reason that an appeal against the order of assessment is also pending. 

Without being prejudiced to the aforesaid Instructions, we are of the view that once the provisions of Income Tax Act provide to release the balance assets/amount after satisfying the liability, there is no occasion for the respondents to retain the same under the executive Instructions. Therefore, at this stage, we feel it appropriate to issue direction to the Principal Commissioner of Income Tax (Central Circle), Lucknow to take decision on the petitioners' representation within fifteen days from the date of communication of this order. 
Accordingly, the writ petition stands disposed of. 

Order Date :- 4.9.2015 

Anupam S/- 

(Akhtar Husain Khan,J.)  (Shri Narayan Shukla,J.) 

Related Updates:
CBDT Instruction 21-01-2009-Release of Seized Assets other than Cash Click Here >>