B.P. Jeevan Reddy, CJ.

1. CMWP No. 909 of 1990 and CMWP No. 1362 of 1990. These two writ petitions filed by Sardar Harinder Singh can be disposed of under a common order. The reliefs sought for in CMWP No. 1362 of 1990 are for issuance of an appropriate writ, order or direction, (1) restraining the income-tax authorities from handing over the seized goods to the Central Excise Department and (2) restraining the Central excise authorities from compelling the income-tax authorities to part with primary gold seized from the petitioner in favour of the Central Excise Department.

2. The reliefs sought for in CMWP No. 909 of 1990 are (1) to restrain the Tax Recovery Officer from realizing the income-tax dues by sale of the assets and properties of the petitioner until they sell the assets seized by them towards the tax liability of the petitioner and (2) direct the income-tax authorities to sell the seized gold and adjust it against the tax liability and the penalty imposed against the petitioner under the Gold (Control) Act, 1968. The petitioner is a director of Singh Engineering Works (P) Ltd., Kanpur. His brothers are also directors of the said company. On July 16, 1981, a raid was conducted by the income-tax authorities at the office premises and residences of the directors of the company including the petitioner. The petitioner's bank lockers in the Punjab and Sind Bank, Defence Colony, New Delhi, were also opened on the following day, i.e., July 17, 1981. From these lockers, three gold bullion bars, each weighing 250 tolas were seized. From the residence and office premises, of course, some articles, cash and other documents were seized. This raid, it is unnecessary to specify, was conducted under the provisions of Section 132 of the Income-tax Act.

3. On October 13, 1981, an order under Sub-section (5) of Section 132 of the Income-tax Act (summary assessment order) was made by the Income-tax Officer, Central Circle III, Kanpur, whereunder the petitioner was found liable to pay tax at an amount exceeding rupees fifteen lakhs. It was also directed that the assets seized from the petitioner must be utilised towards discharge of the said liability. A regular assessment was also made for the relevant assessment year and a demand notice issued under Section 156 for the tax assessed and due. The petitioner submitted a representation to the income-tax authorities requesting them to sell the seized assets in the first instance and adjust the amount realised towards the tax liability determined against him. This request was refused by the income-tax authorities, who issued a recovery certificate for the amount due against the petitioner and for realizing the same, the petitioner's immovable properties including a house at Kanpur were brought to sale. The petitioner thereupon approached this court by way of a writ petition, being W. P. No. 303 of 1986 (Harinder Singh v. 1TO [1987] 166 ITR 763) questioning the recovery certificate as well as the proclamation of sale of his immovable properties. It is necessary to notice the contentions raised in that writ petition and the decision of the court. The contentions urged were :--

(i) In the light of the provisions of Section 132B(1) of the Income-tax Act, the Income-tax Officer had no option but to adjust the seized assets towards the tax liability inasmuch as the seized assets had been retained under Sub-section (5) of Section 132.

(ii) The income-tax authorities had no power to hand over the gold seized and kept in their possession to the authorities under the Gold (Control) Act inasmuch as the Income-tax Department had accepted to appropriate the aforesaid seized assets towards the tax due.

4. These contentions were repelled by the court. It is necessary to notice the reasoning of the court in this behalf (at pages 767, 768) :

"(i) The first question which requires determination in this case is whether the authorities under the Gold (Control) Act are entitled to take action in respect