JUDGMENT
R. K. PATRA J. – The petitioners in this revision are the Commissioner of Income-tax and the Union of India represented by its Secretary in the Ministry of Finance. They as defendants Nos. 6 and 7 in Title Suit No. 6 of 1992 pending in the court of the Subordinate Judge, Sonepur, commenced by opposite party No. 1, filed a petition calling upon the learned trial judge to decide the preliminary issue as to whether the suit is maintainable being hit by section 293 of the Income-tax Act, 1961. The earned judge having decided the issue against the petitioners by the impugned order, this revision has been filed challenging its validity.
A brief narration of certain basic facts is necessary to appreciate the contention raised. The case of opposite party No. 1 is that she is the daughter of Banshidhar Agarwal through his first wife, Mani Debi, whereas opposite parties Nos. 2 to 6 (defendants Nos. 1 to 5) are the sons and daughters of the said Banshidhar Agarwal through his second wife, Kamil Debi. Mani Debi, the mother of opposite party No. 1 died in the year 1958. She had property of about 200 tolas of gold ornaments. She left behind a will bequeathing the gold ornaments to opposite party No. 1 and other children of Banshidhar in proportion to the number of daughters of each of such children to meet the dowry demand and marriage requirements of the daughters. After the. death of Mani Debi, the gold ornaments were in the custody of Banshidhar till February 10, 1990, when he died. After the death of Banshidhar, the ornaments came to remain in the custody of his eldest son (opposite party No. 2-defendant No. 1) because they were not partitioned. Following the death of Banshidhar, opposite party No. 1 and other legatees decided for partitioning the ornaments and agreed to divide the same into 14 parts in view of the fact that Banshidhar had 14 daughters and she (opposite party No. 1 – plaintiff) would get 5 parts out of 14 parts as she herself has five daughters and opposite parties Nos. 2 to 6 (defendants Nos. 1 to 5) would get equal parts of ornaments having regard to the number of daughters they have. It is her allegation that before the partition was effected, the Income-tax Officers raided the house of opposite party No. 2 on March 23, 1990, and seized the gold ornaments in question weighing 2,128 grams. A petition was filed by opposite party No. 1 before the Income-tax Officer for the return of the seized gold ornaments but the prayer was refused. Thereafter she issued notice to petitioner No. 1 which yielded no result. Therefore, the suit has been filed for partition of suit properties.
The petitioners after receipt of notice from the trial court instead of filing a written statement challenged the maintainability of the suit by filing the petition. According to them, their officers in exercise of the powers under section 132 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) searched the house and godown of opposite party No. 2 – defendant No. 1, and seized the ornaments in question. After considering the facts and circumstances of the case, the order was passed under section 132(5) of the Act holding that all the assets seized during the course of search and seizure operation shall be retained. The further case of the petitioners is that the order made under section 132(5) of the Act was not appealed against and as such it has become final. Since the proceeding of assessment is still pending before the Deputy Commissioner of Income-tax (Assessment), in the circumstances the suit is hit by section 293 of the Act.
As already noted, the learned Subordinate Judge framed a preliminary issue “as to whether the suit is maintainable and is hit under section 9 of the Civil Procedure Code, 1908, read with section 293 of the Income-tax Act ?” After hearing both the parties, he has overruled the preliminary objection raised by the petitioners.
Section 293 of the Act provides that no suit shall be brought in any civil court to set aside or modify any proceeding taken or order made under the Act and no prosecution, suit or proceeding shall lie against the Government or any officer of the Government for anything in good faith done or intended to be done under this Act. In the present case, we are not concerned with the second kind of proceedings referred to in section 293. What is barred under the first part of section 293 is a suit in any civil court seeking to set aside or modify any proceeding taken or order made under the Act. Section 9 of the Code of Civil Procedure provides that the courts (subject to the provisions contained therein) have jurisdiction to try all suits of a civil nature excepting suits of which their cognizance is either expressly or impliedly barred. It is now well-settled that exclusion of civil courts jurisdiction is not to be readily inferred. Exclusion of its jurisdiction has to be provided for in express terms or by necessary implication. The principles governing the question as to when exclusion of civil courts Jurisdiction can be inferred have been indicated in several judicial pronouncements. In Secretary of State v. Mask and Co., AIR 1940 PC 105, at page 110, the Judicial Committee observed :
“It is settled law that the exclusion of the jurisdiction of the civil courts is not to be readily inferred, but that such exclusion must either be explicitly expressed or clearly implied. It is also well settled that even if jurisdiction is so excluded, the civil courts have jurisdiction to examine into cases where the provisions of the Act have not been complied with, or the statutory tribunal has not acted in conformity with the fund mental principles of judicial procedure.”
In Dhulabhai v. State of Madhya Pradesh, AIR 1969 SC 78, a Constitution Bench of the Supreme Court; after considering a number of authorities on the point, laid down seven principles regarding exclusion of jurisdiction of the civil court. For the purpose of this case, the first two principles culled out in Dhulabhais case, AIR 1969 SC 78, are relevant. They are (at page 89) :
“(1) Where the statute gives a finality to the orders of the special tribunals the civil courts jurisdiction must be held to be excluded if there is adequate remedy to do what the civil courts would normally do in a suit. Such provision, however, does not exclude these cases where the provisions of the particular Act have not been complied with or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure.
(2) Where there is an express bar of the jurisdiction of the court, an examination of the scheme of the particular Act to find the adequacy or the sufficiency of the remedies provided may be relevant but is not decisive to sustain the jurisdiction of the civil court.
Where there is no express exclusion the examination of the remedies and the scheme of the particular Act to find out the intendment becomes necessary and the result of the inquiry may be decisive. In the latter case it is necessary to see if the statute creates a special right or a liability and provides for the determination of the right or liability and further lays down that all questions about the said right and liability shall be determined by the tribunals so instituted, and whether remedies normally associated with actions in civil courts are prescribed by the said statute or not.”
A perusal of the order dated September 27, 1990, made under section 132(5) by the Income-tax Officer, Bolangir, which is annexure-1 to the revision petition, shows that on the strength of warrant of authorisation issued by the Director of Income-tax (Investigation), Hyderabad, search and seizure operations were conducted in the residence-cum-business premises of opposite party No. 2 who is an assessee under the Act. In the course of the search, assets in the shape of cash, jewellery, gold ornaments, silver articles, silver coins and other valuables like share certificates, N.S.Cs., etc., were seized. The Income-tax Officer issued notice under rule 112A of the Income-tax Rules read with section 132(5) of the Act calling upon opposite party No. 2 to explain the nature of possession and source of acquisition of the assets found and seized from his residence-cum-business premises. He submitted his explanation and after considering the same, the Income-tax Officer passed an order stating that “all the assets seized during the course of search and seizure operation as per details given in the order will be retained.”
It needs reiteration to say that the suit filed by opposite party No. 1 is not to set aside or modify the order dated September 27, 1990, passed by the Income-tax Officer under section 132(5) of the Act. Had she filed the suit for that purpose, the plaint could have been rejected at the threshold in the face of the bar contained in section 293 of the Act. perusal of the entire provision of section 132 would show that it does not give finality to any order passed under sub-section (5) thereof. The said order no doubt is available to be varied or modified by the Chief Commissioner or the Commissioner under sub-section (11) on the basis of an objection made by any person. The said order passed under sub-section (11) has also not been given finality under the statute. It has to be borne in mind that section 132 of the Act relates to the pre-assessment stage. In order to oust the jurisdiction of the civil court in the case at hand one has to examine whether the Income-tax Officer under sub-section (5) or the Chief Commissioner or the Commissioner under sub-section (11) of section 132 would be able to grant the relief claimed by opposite party No. 1 that the seized gold ornaments are subject to partition, it being the stridhan property of her mother who bequeathed the some in a will. As the matter, I am of the view, neither the Income-tax Officer nor the named authority under sub-section (11) of section 132 would be able to grant the aforesaid relief. Opposite party No. 1 is not an assessee and she is a third party so far as the proceeding initiated against opposite party No. 2 under section 132 of the Act is concerned. A case similar to the present one is Maina Debi Goenka v. Union of India [1978] 115 ITR 423 (Cal). A learned single judge of the Calcutta High Court in the said case held that although a suit by the taxpayer to set aside or modify an assessment is barred under section 293 of the Act, a third party may file a suit against the Government for declaration that he is entitled to certain income and properties which are treated by the Assessing Officer as belonging to the assessee. On a careful consideration of the submissions made by counsel for the parties and for the reasons aforesaid, I am of the opinion that although section 132 provides for a remedy by way of challenge before the named authority under sub-section (11) of section 132 of the Act, opposite party No. 1 cannot redress her grievance because the relief of partition claimed by her in the suit cannot be granted by the statutory machinery provided in the Act. The objection of the petitioners against the maintainability of the suit has rightly been overruled by the learned subordinate judge.
In the result, I do not find any merit in this revision which is accordingly dismissed.