The Income-tax authorities have the power to seize property under section 132 of the Income-tax Act, 1961, and the Magistrate does not have the power to order the return of the property under section 523 of the Criminal Procedure Code.

Order.- On the 19th November, 1970, the Inspector of Police attached to the P.I.B., C.I.D., Madras, stoped the bus M.L.J. 4300 near Guindy and arrested one A.K. Ramu on suspicion under section 54 of the Criminal Procedure Code. He seized from him Rs. 1,12,000 (currency notes). Ramu who was sent to Court was remanded to custody . Later, he was released on bail by the Court on 21st November, 1970. The amount seized was not sent to Court. But on the same day, it was. taken away from the Police Station by the Assistant Director of Inspections (Income-tax Intelligence) under the authority of a warrant issued by the Commissioner of Income-tax under section 132 of the Income-tax Act, 1961. Mohanlal, the present petitioner, filed an application before the Chief Presidency Magistrate, for the return of this amount. Observing that the matter does not fall within the purview of section 523, Criminal Procedure Code, the learned Magistrate dismissed his application. The correctness of this order is now canvassed in this revision.

2. Under section 523, Criminal Procedure Code, when such a seizure is done-by a Police Officer, he should forthwith report the matter to the Magistrate and the latter should make such orders as he thinks fit, respecting the disposal of such property, or the delivery of the property to the person entitled to the possession thereof, or if such person cannot be ascertained, respecting the custody and production of such property. Ramu was arrested by the Inspector with the amount on suspicion. He was sent for remand to Court. The currency notes were not sent but they were retained in the police station. Those notes were taken away from the station by the Assistant Director of Inspections under the authority of a warrant issued by the Commissioner of Income-tax under section 132 of the Income-tax Act. Later, the Commissioner had issued a notice to the petitioner under section 132 (5) read with section 132 (7) of the Income-tax Act. The petitioner participated in this enquiry and the Commissioner had passed an order directing the return of Rs. 44,240 to the petitioner. The balance of the amount is now with him awaiting disposal as provided for in section 132 (a) of the Income-tax Act. The Income-tax Officers have thus seized the amount under the authority conferred on them by the statute. They have powers to deal with the seizures and deposits under the provisions of that Act. The proceedings before the Income-tax authorities are not criminal proceedings and the Income-tax authority is not a Court. Vide Balwant Singh v. Bharupal, Income-tax Officer, New Delhi1. As pointed out by their Lordships of the Supreme Court in State of West Bengal v. Basak2, this statutory power cannot be interfered with by the exercise of powers under section 439 or under the inherent powers of the Court under section 561-A, Criminal Procedure Code, when there was no case pending at the time excepting that the person against whom the investigation has started had appeared before the Court, had surrendered and had been admitted to bail. This was a case which related to the powers of interference with the statutory right of investigation conferred upon the police under section 156 of the Criminal Procedure Code. In Emperor v. Nazir Ahmed3, their Lordships of the Privy Council observed as below:

“The functions of the judiciary and police are complementary, not overlapping and the combination of indivdual liberty with due observance of law and order is only to be obtained by leaving each to exercise its own function, always, of course, subject to the right of the Court to intervene in an appropriate case, when moved under section 491, Criminal Procedure Code, to give directions in the nature of habeas corpus. The Court’s functions begin when a charge is preferred before it and not until them, and therefore, the High Court can. interfere under section 561-A only when a charge has been preferred and. not before.”

3. Granting that the Inspector of the In

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