St.Antony Educational and So vs The Central Board of Direct

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2023 Supreme(Online)(MAD) 25216

IN THE HIGH COURT OF JUDICATURE AT MADRAS Reserved On 07.08.2023 Pronounced On 31.10.2023 CORAM THE HON'BLE MR.JUSTICE C.SARAVANAN W.P.Nos.18281 & 18285 of 2022 and W.M.P.Nos.17631 & 17637 of 2022 St.Antony Educational and Social Society, Represented by its President, D.Prakash Mull Cordia .. Petitioner in W.P.No.18281 of 2022 D.Prkashmull Chordia .. Petitioner in W.P.No.18285 of 2022 vs.
1.The Central Board of Direct Tax, Represented by its Chairman, North Block, Secretariat Building, New Delhi.
2.The Director General of Income Tax (Investigation), No.46, Mahatma Gandhi Road, Chennai 600 034.
3.The Commissioner of Income Tax, (Appeals)-18, Aayakar Bhavan, Mahatma Gandhi Road, Chennai 600 034.
4.The Deputy Commissioner of Income Tax, Central Circle-1(3), Investigation Wing, Room No.312, 3rd Floor, Mahatma Gandhi Road, Chennai 600 034. ... Respondents in both W.Ps.
Prayer in W.P.No.18281 of 2022 : Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari calling for the records of the second respondent in ITBA/COM/F/17/2021-
22/1041684063(1) dated 26.03.2022 and quash the same.
Prayer in W.P.No.6553 of 2020 :Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari calling for the records of the second respondent in ITBA/COM/F/17/2021-
22/1041682025(1) dated 26.03.2022 and quash the same.
In both W.Ps.
For Petitioner : Mr.N.R.S.Ganesan For Respondents : Mr..A.P.Srinivas Senior Standing Counsel Mr.A.N.R.Jayaprathap Junior Standing Counsel

C O M M O N O R D E R

By this common order, both the writ petitions are being disposed of.

2. In W.P.No.18281 of 2022 has been filed by the petitioner Society, W.P.No.18285 of 2021 filed by the president of the said Society.

3. The petitioner in W.P.No.18281 of 2022 is aggrieved by the impugned order dated 26.03.2022 bearing Reference Nos.ITBA/COM/F/17/2021-22/1041684063(1) passed by the second respondent, the Director General of Income Tax (Investigation), Chennai. In W.P.No.18285 of 2022, the petitioner is aggrieved by the impugned order dated 26.03.2022 bearing Reference Nos. ITBA/COM/F/17/2021-22/1041682025(1) passed by the second respondent, the Director General of Income Tax (Investigation), Chennai. Both the impugned orders have been passed by the second respondent under Rule 112(F) of the Income Tax Act, 1962.

4. These impugned orders have been passed pursuant to an applications both dated 25.02.2022 filed by the respective petitioners under Rule 112(F) of the I.T.Act,1962. Both the impugned orders passed by the second respondent under Rule 112 of Income Tax Rules, 1962 read identically.

5. Relevant portion of the impugned order, reads as under:-

In this regard attention is drawn to the Circular No.10/2012 [FNo.282/22/2012-IT (INV.V] dated 31.12.2012, issued by the CBDT on this issue wherein it has been stated that “4. In such cases, the officer investigating the case, with the approval of the Director General of Income Tax, Shall certify that-

i.the search is conducted under Section

132 or the requisition is made under Section 132A of the Act in the territorial area of an assembly or parliamentary constituency in respect of which a notification has been issued under Section 30, read with Section 56 of the Representation of the People Act, 1951;

or ii. the assets seized or requisitioned are connected in any manner to the ongoing election process in an assembly or parliamentary constituency; and iii.no evidence is available or investigation is required for any assessment year other than the assessment year relevant to the previous year in which search is conducted or requisition is made”.

6. Operative portion of para 4 in the respective writ petition read as under:-

W.P.No.18281 of 2022	W.P.No.18285 of 2022
Impugned Order in ITBA/COM/F/17/2021- 22/1041684063(1)	Impugned order in ITBA/COM/F/17/2021- 22/1041682025(1)
From the above Circular of the CBDT, it is clear that exemption under Rule 112F is to be given in cases where no evidence is available or investigation is required for any Asst.Year other than the A.Y. Relevant to the previous year in which search is conducted or requisition is made. In the case of M/s.St.Antony Educational and So- cial Society, it is seen that evidences have been found that cash was being received back by M/s.Shri D.Praksh- mull Chordia out of the salary credited in the bank accounts of the employees of the Trust St.Antony Educational and Social Society. Thus, evidences have been found which show that salary ex- penses paid to the employees of the Trust St.Antony Educational And So- cial Society are inflated and are re- ceived back in cash by the assessee	From the above Circular of the CBDT, it is clear that exemption under Rule 112F is to be given in cases where no evidence is available or investigation is required for any Asst.Year other than the A.Y. Relevant to the previous year in which search is conducted or requi- sition is made. In the case of Shri.D.Prakashmull Chordia, it is seen that evidences have been found that cash was being received back by M/s.Shri D.Prakshmull Chordia out of the salary credited in the bank ac- counts of the employees of the Trust St.Antony Educational and Social So- ciety. Thus, evidences have been found which show that salary expenses paid to the employees of the Trust St.Antony Educat

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