Law: Income Tax Act, 1922

Section: 54(1)

Section 137 of the Income-tax Act, 1961 [Corresponding to section 54(1) of the Indian Income-tax Act, 1922] - Income-tax proceedings - Disclosure of information prohibited - Respondent nos. 1 and 2 filed a suit against petitioners defendants for recovery of certain sum - Petitioners raised objection that respondent nos. 1 and 2 and another person had constituted partnership firm which was not registered, hence, suit filed by them was not maintainable - Petitioners also filed petition in court to summon ITO to produce a letter written by Chartered Accountants who represented respondent nos. 1 and 2 before ITO requesting return of original partnership deed filed in department - Whether provisions of section 54 of 1922 Act did not apply in instant case and, therefore, letter written by Chartered Accountants to ITO requesting return of certain documents filed before officer could be summoned for and marked as evidence in instant suit - Held, yes FACTS Respondent Nos. 1 and 2 filed a suit against the defendants for recovery of certain sum. One of the defences raised was that the respondent Nos. 1 and 2 and another, constituted a partnership and that, as the partnership was not registered, the suit was not maintainable. Defendant Nos. 1 and 2 filed application in the lower court to summon the ITO to produce a letter dated 24-4-1956, written by the Chartered Accountants, who represented the respondent Nos. 1 and 2 before the ITO, requesting the return of the original partnership deed filed in the department. It was stated that the said letter also bore an endorsement of the ITO that the said document might be returned and also contained an endorsement by the Chartered Accountants acknowledging the return of the document. The lower court ordered the documents to be produced, and expressed the view that as the case was covered by section 54, clause (4), the prohibition contained in clause (1) of section 54 did not apply. The ITO however, informed the court that the registers in his office did not indicate the existence of any file relating to the plaintiff Nos. 1 and 2 under section 26A. The lower court therefore, held that, since there was no file under section 26A…

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