Radhika Mittal
In a landmark ruling, the Kerala High Court has established that authorities under the Income Tax Act, 1961, are entitled to seek interim custody of seized currency notes. This decision was made by a Division Bench comprising Justices PB Suresh Kumar and C Pratheep Kumar, who underscored the powers granted to tax authorities for requisitioning and obtaining assets from taxpayers to settle liabilities.
The court’s judgment arose from a case involving multiple appeals where the seized currency was reported to the jurisdictional Magistrate under Section 102 of the Code of Criminal Procedure. The judges noted that if authorities have reason to believe that seized assets represent undisclosed income, they are justified in retaining custody until investigations conclude.
This ruling clarifies previous conflicting judgments by single judges regarding the custody of seized assets. The court emphasized that while authorities can hold such assets, there is no statutory requirement to complete proceedings within six months, as previously directed by another ruling. This decision strengthens the authority of tax officials in managing seized assets amid ongoing inquiries.
Case Title: Ankush and Another v. Income Tax Department and Another
Bench: Justice Bechu Kurian Thomas
Click here to access judgment