Del HC | Whether information in respect of an investigation carried out by office of DG of Income Tax (Investigation) is required to be intimated to complainant? Read HC’s view

Delhi High Court: Suresh Kumar Kait, J., while addressing the present matter, observed that,

Providing information regarding an ongoing investigation to its informer is not only inappropriate but also injurious to the ongoing investigation.

The instant petition was filed under Section 482 of Criminal Procedure Code, 1973 seeking setting aside of the orders passed in Rajiv Yaduvanshi v. Principal Director, Income Tax (Investigation-I), Crl. 102 of 2020.

Background

Investigation unit of the Income Tax Department received a Tax Evasion Petition by respondent 1 against Vandana Sodhi and Sandeep Sumbly (respondents 2 and 3, respectively).

The Tax Evasion Petition after going through the due procedure was marked to the Dy. Director of Income Tax, Investigation Unit 8(4) under the administrative control of Principal Director of Income Tax (Investigation-2). Department further commenced the proceedings as per the Standard Operating Procedure. 

On 23-09-2020, an “Application for Calling Status Report” was filed by respondent 1. In the said application, an ex-parte order was passed.

On 05-10-2020, the said application was again listed before ACMM and it was directed that a status report be filed. Thereafter the said application was again listed before the ACMM and time was sought on behalf of the petitioner as the concerned PDIT had been transferred. Again on 28-10-2020, the said application was again listed before the ACMM, wherein a Notice was issued.

Contention

Respondent 1 accepted the notice and counsel for respondent 1 submitted that the filed application before the Court to know the status of the investigation and the petitioner department is duty-bound to comply with the directions passed by ACMM.

Petitioners Counsel submitted that impugned order passed by ACMM calling for a status report were passed without jurisdiction as no provision of the CrPC gives such power to the ACMM.

Further, the counsel added that, it is a settled principle of law that neither the ACMM nor any Court below, however, only this Court has inherent powers under CrPC.

It was noted in the instant case that, respondent 1 had filed an application without any procedure mentioned in CrPC or Income Tax Act. Moreover, the Judge passed directions after directions without realizing even that he does not have inherent powers under CrPC.

Decision

Court observed that the said application was filed under Section 51 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Rules Act, 2015 and ACMM did not consider Section 55 of the said Act.

In view of the above, ACMM usurped the inherent jurisdiction of this Court which is impermissible under the law.

Moreover, in the cases pertaining to Tax Evasion Petitions, this Court also exercises its powers sparingly and it is a well-settled principle that only the broad outcome of Tax evasion petition may be communicated to the complainant, that too upon culmination of the investigation.

Income Tax Department has a specific framework of investigations dealing with the TEPs and information in respect of the investigation carried out by the office of Directorate General of Income Tax (Investigation) is not required to be intimated to the complainant as the said office is even outside the purview of the RTI Act, 2005.

Reliance on the decision of the Central Information Commission was placed:

S.K. Agarwalla v. Directorate General of Central Excise Intelligence, CIC/AT/A/2007/01455, in this decision the appellant vide an RTI application requested information relating to the progress of the case under investigation, wherein it was held as under:

“..although speedy investigations in matters of revenue- evasion is salutary goal, it would be inappropriate and even injurious, to ongoing investigations if informers are allowed to intrude into the investigative progress all in the name of enforcing a Right to Information. Intrusive supervision of investigation work of public authorities especially by interested parties has the effect of impeding that process, in the sense it exposes the officers to external pressures and constricts the freedom with which such investigations are to be conducted. Commission also felt that there is no reason why officers of public authorities should space their investigations to benefit informants. Intrusive interference in investigation work is not conductive to such investigations and, in that sense, impedes it.”

Court held that since the application filed by respondent 1 before the ACMM was without the provisions of either CrPC or Income Tax Act which is bad in law.

Hence, the orders passed by Judge are declared as illegal, perverse and without jurisdiction and therefore the same are set aside. [Principal Director, Income Tax (Investigation-2) v. Rajiv Yaduvanshi, Crl. MC No. 2140 of 2020, decided on 06-11-2020]

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