Judgment

SHAH, J.: Jawahar Lal Rastogi hereinafter called the assessee is a Hindu Undivided Family which carries on the business of money-lending at Lucknow and is also interested as a partner in different firms engaged in the business of manufacturing barbed wire, pharmaceuticals, etc.

2. On September 14, 1964, the Income-tax Officer, A-ward called upon the assessee to furnish within 10 days certain information with regard to its income and assets. On September 17, 1964 the Income-tax Officer submitted to the Commissioner of Income-tax a report requesting that he be authorised to enter and search the premises of the assessee. The Commissioner by his order dated September 19, 1964, authorised entry and search after recording reasons for his belief that it was necessary to carry out the search. On September 21 & 22, 1964, the premises of the assessee were searched and a large number of documents were seized and were taken away to the Income-tax Officer. The Income-tax Office also prepared inventories of the ornaments and other goods kept in the premises searched. After the seizure of the books of account and other documents the case was fixed for hearing before the Income-tax Officer on several occasions, but no substantial step was taken.

3. In May 1966 the assessee filed a writ petition in the High Court of Allahabad challenging the validity of the search made by the Department contending that it "was illegal and in excess of the power conferred by Section 132 of the Income-tax Act, 1961" and prayed that the documents seized may be ordered to be released. The High Court of Allahabad considered the evidence appearing from the affidavits filed and observed that in the present case the assessee had established the following "points":

(1) The Income-tax Officer was apparently interested in investigating transactions prior to 1953. On September 14, 1964, the assessee was directed to furnish statements relating to four years ending on March 31, 1960, yet the Commissioner of Income-tax issued letters of authorisation permitting Income-tax Officers to seize documents relevant to nine assessment years;

(2) The raid was ordered and organised before the expiry of the period of the notice;

(3) More than 300 books and registers were seized during the raid and the Income-tax Officers carried away thousands of promissory notes. Some of the documents seized appear to be irrelevant for assessment purposes and some of them were public documents;

(4) There is reason to believe that all or almost all the documents found on the premises were seized and carried away by the Income-tax Officer;

(5) Marks of identification were not placed on the documents in spite of the direction contained in the letter of authorisation; and

(6) The documents seized during the raid were detained by the Income-tax Officers for 10 months before the petition was filed.

4. In the view of the High Court the circumstances of the case indicated that the Commissioner of Income-tax and the Income-tax Officers acted beyond "the legitimate scope of Section 132 of the Act and there was force in the complaint of the assessee that the opposite parties carried out indiscriminate search which constituted abuse of power conferred on Income-tax authorities by Section 132 of the Act." In reaching its conclusion, the High Court relied upon the judgment of the Allahabad High Court in Seth Brothers v. Commissioner of Income-tax, (1966) 62 ITR 44

5. In this appeal filed by the Commissioner of Income-tax with special leave, the Solicitor-General contends that the decision of the Allahabad High Court in Seth Brothers case, (1966) 62 ITR 44 was overruled by this Court in Income-tax Officer, Special Investigation Circle "B", Meerut v. Seth Brothers, (1969) 74 ITR 836 and on the account the judgment under appeal is liable to be set aside. In Seth Brothers case, (1969) 74 ITR 836 this Court examined the scheme of S. 132 in some detail and observed:

"The condition for entry into and making search of an