Law:

Section:

Section 132 of the income-tax act, 1961-Search and seizure-Search authorised by CIT in respect of petitioner's two sons at their residential premises also occupied by her-Jewellery discovered in petitioner's room claimed by her as her exclusive property-Assets and documents searched Disclosed that petitioner was doing money lending business and was neither income-tax nor wealth-tax assessee-Fresh search/seizure warrants issued by CIT against petitioner and jewellery, etc., consequently seized in her name-Whether action by CIT under section 132(1) and subsequent search and seizure of impugned assets legal-Held, on facts, yes Facts The petitioner, along with his two sons, resided in one residential premises which stood in her name. As a result of search operations authorised by CIT under section 132(1), the raiding party recovered certain jewellery from the safe and further discovered hidden jewellery after carrying out digging operations in one of the rooms exclusively occupied by her. She, thereafter, claimed the entire jewellery as exclusively belonging to her. On that basis the said hidden jewellery was seized in her name and the other jewellery recovered from safe was left with her after making an inventory thereof. After this search, the concerned ITO issued notice for initiating proceedings under section 132(5). The CIT was also informed that, apart from the jewellery, certain other items seized revealed that she was carrying on some business of lending and that she had neither been income-tax nor wealth-tax assessee. The CIT, accordingly, issued another authorisation under section 132(1)(b) and (c) in pursuance of which the discovered items of jewellery and documents were formally seized in her name on the next day. On writ, the petitioner challenged the legality of these search and seizure proceedings as also the consequent seizure of assets and claimed the return of the seized property. Her claim was grounded on the following main contentions: a.The CIT had no information to satisfy him about the necessity of action under section 132(1). b.The assets seized in her hands had already been searched out before the issue of subsequent formal search and…

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