A. S. N. M. Idris Ambalam vs M. Abdul Hakim. on 3 August, 1967

Madras High Court
A. S. N. M. Idris Ambalam vs M. Abdul Hakim. on 3 August, 1967
Equivalent citations: 1968 68 ITR 733 Mad


This revision proceeding involves a point of some interest, with regard to the precise effect of section 137(1) and (2) of the Income-tax Act (43 of 1961), in relation to interrogatories served on a party to a suit under Order XI, Civil Procedure Code. The facts are not in dispute, that the interrogatories included one question whether the respondent to the present proceedings had shown a particular amount in his Income-tax return for a particular year. The respondent declined to answer this question, claiming privilege and the learned fourth assistant judge of the City Civil Court has upheld the claim of privilege.

I am afraid that the order of the court below proceeds on a misconception, and that the view taken by the learned judge is not correct. Privileges of parties to a proceeding generally are to be found in the Indian Evidence Act (I of 1872), particularly such sections as section 22 which relates to communications during marriage, section 126 relating to bar of disclosure of professional communications by barristers and lawyers, section 124 which concerns official communications, etc. There is nothing in these sections to prevent a person from being asked whether he had shown a particular asset or income in his income-tax return for a particular year, or otherwise.

The privilege is sought to be based upon section 137(1) and (2) of the Income-tax Act (43 of 1961), and on certain observations of Mockett J. in Velayudham Pillai v. Subramania Pillai. When this matter is examined carefully, it will at once be seen that the claim of privilege on behalf of the party to a litigation, in this form, is erroneous and proceeds on a misconception. Section 137(1) is a protection to public servants, in respect of a compelled disclosure off the contents of such documents, as income-tax returns, and section 137(2) imposes an obligation on the public servant not to reveal such particulars. In Velayudham Pillai v. Subramania Pillai, the plaintiff attempted to compel the defendant to obtain and file certified copies of his income-tax returns, procuring these copies from the department and the court pointed out that, in view of section 54 of the Income-tax Act as it then was, such compulsion could not be exercised. There is absolutely nothing in section 137 to prevent a party from being asked a question simpliciter whether he had included a particular asset or income in his income-tax return, or inhibiting a party from replying to such a question. The Bench of Veeraswami J. and Krishnaswamy Reddy J. observed in Sivagami Achi v. Ramanathan Chettiar that section 137 did not create an obligation, privilege or right. The learned counsel for the revision petitioner brings it to my notice that in the latest Income-tax Act, section 137 is altogether omitted.

However that might be, the position in law is clear, and this question can be asked of the respondent with perfect validity. The court can also ask the respondent to reply under Order XI, rule 11, Civil Procedure Code and he cannot claim that any statutory privilege exempts him from making any reply. But, of course, apart from this, he may choose to make any reply that he pleases. If his reply amounts to a suppression of a material fact within his knowledge, the party concerned can ask the court to draw a particular inference from that reply. Whether the court does so or not, depends entirely on the total circumstances, which need not be discussed here. Further, if the respondent chooses to state that he did not include the asset, or declines to reply, and the revision petitioner desires to refute the reply by producing the original document, the question whether the revision petitioner can thus attempt to procure the original return from the department, is a different matter altogether. That will concern the obligations and rights of the income-tax authorities and it will have to be dealt with on the provisions of the Income-tax Act as it stands.

The order of the lower court is accordingly set aside, and the court will now further proceed into the matter as laid down under Order XI, Civil Procedure Code. There will be no order as to cost.

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