Law: Income Tax Act, 1961

Section: 137

Law: Income Tax Act, 1961

Section: 137

Section 137 of the Indian Income-tax Act, 1961 [omitted by section 32 of Finance Act, 1964], read with section 6 of the General Clauses Act, 1897 - Disclosure of information prohibited - Whether provisions of section 137(5) permitted voluntary disclosure of any particulars referred to in section 137(1) by person by whom statement, affidavit or deposition was made, evidence given, return furnished accounts or documents, as case may be - Held, yes Respondent accused were prosecuted for offences of criminal breach of trust, criminal conspiracy etc - They urged that since they produced documents and gave information to income-tax authorities such criminal proceedings were initiated - They requested Magistrate that ITO could be directed to produce documents summoned by Court - Whether there was no ground to interfere with order of Magistrate - Held, yes FACTS The accused were prosecuted for offences of criminal breach of trust, criminal conspiracy, etc. They were employees and their case was that on account of their producing the documents and giving information to the income-tax authorities the criminal case had been filed against them. The accused relied on the documents to prove the motive for the prosecution being launched against them. The Magistrate directed the ITO to produce the documents. On revision petition, the petitioner ITO submitted that in view of section 137 he had right and privilege not to produce these documents. Further since these documents were produced before 1-4-1964 i.e., before amendment by the Finance Act of 1964 his right and privilege not to produce the documents by virtue of section 137, would not be affected by virtue of the repeal of section 137 by the Finance Act of 1964. HELD The provisions of section 137(5) permitted the voluntary disclosure of any particulars referred to in sub-section (1) by the person by whom the statement, affidavit or deposition was made, the evidence given, the return furnished or the accounts or documents produced, as the case may be. Though section 137 of the Income-tax Act of 1961 is repealed by the Finance Act of 1964, there is modified restriction by virtue of section 138, clause (2), introduced by the…

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