Law:

Section:

Section 132 of the Income-tax Act, 1961 - Search and seizure - Whether where deemed seizure was made against petitioner in respect of refunds which were to be made because of over subscription to shares issued by petitioner, it would absolve petitioner of any liability which might be attached to it under provisions of law other than Income-tax Act, 1961, and, non-refund of amounts so seized could not be a ground for taking any action by any authority against petitioner - Held, yes FACTS The respondents had issued an authorization under section 132(1) against the petitioners and had also issued restraint orders under section 132(3), in respect of refunds which were to be made by the petitioners because of oversubscription to the shares which had been offered to the public by the petitioner. Against aforesaid orders, a writ petition was filed. During the pendency of the petition, the earlier restraint order under section 132(3) had been converted to be a deemed seizure under the second proviso to section 132(1). HELD The result of the deemed seizure was that the petitioner was deemed to have made a refund of the extra subscription money received by it to six persons in respect of whom the deemed seizure had been ordered. The deemed seizure would absolve the petitioner of any liability which might be attached to the petitioner under the provisions of laws other than the Income-tax Act, 1961, and the non-refund of the amounts so seized could not be a ground for taking any action by any authority against the petitioner. Note: Decision was in favour of Petitioner. N. Ganapathy and Ajay Behl for the Petitioner. Rajendra and D.N. Malhotra for the Respondent. JUDGMENT In the present case, the respondents had issued an authorisation under section 132(1) of the Income-tax Act, 1961, against the petitioners and had also issued restraint orders under…

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