Brij Mohan v. Commissioner of I. T. — 1973 DIGILAW 174 (RAJ)

JOSHI, J.- The above four writ petitions have come before us in connection with disposal of two applications in each case, one moved by the petitioner under O. 6 r. 17 of the Code of Civil Procedure seeking amendment of the writ petition and another on behalf of Commissioner of Income-tax, hereinafter referred to as the C. I. T. under sec. 151 C P. C. for dismissing all the four writ petitions as having become infructuous. 2. Excepting that; the articles recovered from each of the petitioners are different the facts leading to all the four writ petitions and prayers made therein are substantially similar. In each of the petitions it has been prayed that search and seizure of the goods undertaken by the officers of Income-tax Department were not under any warrant of authorisation under Rule 112 of the Income-tax Rules and, therefore, the entire seizure of the goods from the petitioner was without the authority of law. It was further prayed that a declaration be issued to the effect that sec. 132 of the Income-tax Act (hereinafter referred the Act did not authorise the personal search of any person or seizure of any property in the hands or in the pocket of such person. It was also prayed that a declaration be issued that Rule 112 of the Income-tax Rules does not authorise any Income-tax Officer to take search of the person and seizure of goods from him unless a search warrant was issued against him or unless he was an agent of the person guilty of tax evasion. It was further prayed that search and seizure of the goods and all the proceedings taken by the respondents on the 1st August, 1972, be quashed. The petitioner also prayed for a writ of prohibition restraining the respondents from taking further proceedings or to take any assessment under sec. 132(5) of the Act. Lastly it was prayed that the respondents be directed to return the goods seized from the petitioner on 1-8-1972. The petitioner also prayed for a writ of prohibition restraining the respondents from taking further proceedings or to take any assessment under sec. 132(5) of the Act. Lastly it was prayed that the respondents be directed to return the goods seized from the petitioner on 1-8-1972. The above mentioned prayers were made mainly on the grounds: (1) that the search warrants authorised the respondents to take search of the business premises of Messrs Shri Narain Ganesh Narain and to seize the valuable articles which represented wholly or partly the income or property which remained undisclosed by the said firm for the purposes of the Act; (ii) that the respondents were not authorised to make a search of the petitioner and much less to seize the goods from him; (iii) that the provisions of sec. 132 could not be applied to the case of the petitioner; (iv) that the petitioner was prepared to get the verification of the articles seized from him but no opportunity was given to him for that purpose; (v) that the respondent Income-tax Officer is going to estimate the undisclosed income of the petitioner in a summary manner to the goods seized from the petitioner and to get the entire amount of the property for the purposes of satisfying the alleged tax liability. 3. Along with the writ petition each of the four writ petitioners moved a stay application alleging that it was apprehended that the Income-tax Officer was going to treat all his property as his undisclosed income and make a summary assessment order which was likely to adversely affect the petitioner. It was, therefore, prayed that this Court should issue an ad interim order restraining the respondents not to proceed with the assessment under sec. 132(v) of the Act. This Court having regard to the facts and circumstances pointed out in the writ petition called for Mr. S.C. Bhandari, counsel for the Revenue, on 11-10-1972 to take notice of the stay application and the case was posted for orders on 20-10-1972 as prayed for by counsel for both sides. On 20-10-1972 the Department submitted a reply to the stay application supported by an affidavit. In the reply it was alleged that the petitioner completely suppressed the most important fact that jewellery in his possession was recovered in pursuance of authorised warrant of search and seizure. On 20-10-1972 the Department submitted a reply to the stay application supported by an affidavit. In the reply it was alleged that the petitioner completely suppressed the most important fact that jewellery in his possession was recovered in pursuance of authorised warrant of search and seizure. In support of this allegation the respondents submitted the certified copies of the authorisation warrant in favour of the officers who conducted the search and seizure and also submitted a copy of Panchnama in regard to the property seized from each of the petitioners. The warrant of authorisation issued by the Income-tax Commissioner and Panchnama were shown to each of the petitioners in the court and each of them owned that the signature on the documents were his. Upon this Mr. Agarwal learned counsel for the petitioner sought time to file a rejoinder to the answer of the Income-tax Department and the case was posted for rejoinder on 23rd October, 1972. On 23rd October, 1972, instead of filing the rejoinder Mr. Agarwal, counsel for the petitioner, prayed that he be permitted to amend the petition and two weeks time was allowed for filing an application for amendment. 4. On 9-11-1972 an application for amendment was made on behalf of each of the petitioners seeking extensive amendments by inserting a number of paragraphs by deleting some of them and by adding and substituting a number of grounds on which the writ was sought and also by deleting and adding the paragraphs in various clauses of grounds. The proposed amendments may be classified under the following categories:— CATEGORY I.(1) Additional inconsistent facts which were available to the petitioner at the filing of the writ petition and the grounds and reliefs arising therefrom. This head comprises the proposed amendment contained in para 6(a) and 6(aa) and new grounds (ii), (iii), (iv), (v), (va), (vb), (vc), (vd) and (xxiii) instead of the existing grounds (ii), (iii), (iv) and (va) to (vd) contained in para 6(c) of the amendment application. CATEGORY No. II. Post writ facts, grounds and corresponding reliefs: Under this category proposed amendments are detailed in para 6(g) and prayer clause (o) of para 6(m) of the application for amendment. CATEGORY III.—Additional grounds in support of the writ which are not inconsistent with the facts mentioned in the writ. These grounds find place in the amendment application in grounds Nos. Post writ facts, grounds and corresponding reliefs: Under this category proposed amendments are detailed in para 6(g) and prayer clause (o) of para 6(m) of the application for amendment. CATEGORY III.—Additional grounds in support of the writ which are not inconsistent with the facts mentioned in the writ. These grounds find place in the amendment application in grounds Nos. XXVIII and 30, 31, 33, 34 and 35 occurring in paras (h), (i) and (j) of the amendment application. 5. The amendments sought in all the four writ petitions are almost of similar nature but numbering of the paragraphs in the respective writ petitions is slightly different. Mr. Agarwal therefore addressed us with reference to D. B. Civil Writ Petition No. 1618 of 1972 Babulal V.C.I.T. Jaipur for the sake of convenience. We have, therefore, made reference to the paragraphs of the amendment application in Babulals case and give our decision on that basis which will govern the decision of the rest of the amendment applications in other cases. 6. The application for amendment has been seriously opposed on behalf of the respondents. In reply to the amendment application the respondents have contended that the application under O. 6 r. 17 read with sec. 151 C. P. C seeks extensive amendments by inserting a number of paragraphs by deleting some of them by adding and substituting a number of grounds on which the writ is sought. It was alleged that amendments sought are so wide and fundamental that they completely change the very nature of the original writ petition and virtually the proposed amendment will tantamount to filing of a new writ petition under the guise of amending the original one. It was further stated in the reply on behalf of the respondents that the petitioner cannot be allowed amendment to convert a writ of prohibition into a writ of certiorari by making a prayer of quashing the order passed by I. T. O. under sec. 132(5) as it was not even in existence at the time when the original writ was filed. The respondents further alleged that the proposed amendment seeks to substitute one cause of action for the other and such amendment is not permissible under the law and the same should be disallowed. 7. We have heard learned counsel for the parties on the amendment application. We shall deal with the amendment application under each category. The respondents further alleged that the proposed amendment seeks to substitute one cause of action for the other and such amendment is not permissible under the law and the same should be disallowed. 7. We have heard learned counsel for the parties on the amendment application. We shall deal with the amendment application under each category. CATEGORY, I.—As regards the new facts which are sought to be introduced it may be noticed that the case set up in the original writ petition is that the concerned officer who conducted the search and effected the seizure of the goods from the concerned petitioner was not at all authorised. The petitioner now seeks to give up this stand and contrary to it, has asked to substitute an inconsistent case that the authorised warrants in case of each of the petitioners were obtained after knowing the list of articles with each of the petitioners in consequence of a conspiracy entered into by the Commissioner of Income-tax and the officer concerned. This in our opinion is nothing but an endeavour to introduce totally a different new and inconsistent case. It is true that the provisions of Code of Civil Procedure are applicable to civil proceedings including the writ petitions as far as practicable by virtue of sec. 141 of the Code of Civil Procedure. But it has to be borne in mind that the writ proceedings are civil proceedings in exercise of extra ordinary jurisdiction. Even the object of O. 6 r. 17 C. P. C. is to allow an amendment for the purpose of determining the real question in dispute between the parties, as will appear from the reading of O. 6 r. 17 itself. That being the purpose for which an amendment is allowed, no amendment could be allowed which would introduce a totally new and inconsistent case. The proposed amendment alters the fundamental character of the case set up in the original writ petition as it alters the very foundation on which the writ is based. The reason for this is that the substitution of a totally new case in place of the original one cannot be said in any sense to be an amendment of the original claim. The reason for this is that the substitution of a totally new case in place of the original one cannot be said in any sense to be an amendment of the original claim. Nor can it be said that a totally new case comes under the expression "necessary for the purpose of determining the real question in controversy between the parties" occurring in O. 6 r. 17 C.P.C. The Inconsistent case of a fundamentally different character certainly cannot be taken to be one necessary for the purpose of determining the real question in controversy. Reference in this connection may be made to Kanda vs. Waghu (l). In that case plaintiff brought suit challenging the validity of a deed of gift relating to the land on the ground that the land was ancestral and the gift was contrary to custom. The Subordinate Judge held that the plaintiff had failed to prove the custom alleged. He consequently dismissed the suit with costs. The appellants appealed. The appellate Judge agreed with the finding that the land was not ancestral but he was of opinion that the properties were governed by custom in the matter of alienation and he, therefore, framed an additional issue in these words: "The land in suit having been found to be non-ancestral though the collaterals excluded the daughters son according to custom of parties and is the gift, therefore, invalid?" The issue of course did not arise on the pleadings. On an appeal to the High Court it was held that the District Judge erred in framing the new case for the appellants. In appeal to the Privy Council the plaintiffs asked for leave to amend the plaint in order to cover the new case, and the same was refused with the following observations: "As already indicated, the question embodied in the additional issue was not raised in the plea lings. The appellants founded their claim on the ground that the land was ancestral and it was on that ground that they challenged the right of the widow to make the gift. Not once during the proceedings in the trial did they suggest if the land was found to be non-ancestral the widow could still be incompetent to dispose of it. The appellants founded their claim on the ground that the land was ancestral and it was on that ground that they challenged the right of the widow to make the gift. Not once during the proceedings in the trial did they suggest if the land was found to be non-ancestral the widow could still be incompetent to dispose of it. In Eshendhunder Singh vs. Shama Churu Bhutto Moor(2) Lord West Eury described it as an absolute necessity that the determination in a case should be founded upon a case to be found in the pleadings or involved in or consistent with the case thereby made. The course decided upon by the learned District Judge offended against this principle and their Lordships consider that he was rightly overruled. In asking the Board to allow the plaint to be amended at this stage attention has been drawn to the provisions of sec. 153 and O. 6, R. 1/ C.P.C. The powers of amendment conferred by the Code are very wide but they must be exercised in accordance with legal principles, and their Lordships cannot allow an amendment which would involve the setting up of a new case. The judgment of Lord Buck Master in Ma Shwe Mya vs. Maung Mo Huaung (3) is directly on point. It was held that it was not open to the Court under sec. 153 and O. 6, R. 17 to allow an amendment which would alter the real matter in controversy between the parties." It will thus appear that the proposed amendments as regards new addition of facts and grounds referred to above under category I, cannot be allowed as they are not necessary to determine the real question in controversy contained in the original writ petition. 8. The second category of amendment relates to the facts leading to the making of order of summary assessment after filing of the writ petition and also to the prayer for quashing the same. Mr. Agarwal submitted that this Court has not only power to grant amendment in regard to the subsequent events having bearing on the ultimate decision of the case but will be perfectly justified to take notice of subsequent events even if not pleaded if they have a bearing upon the relief to be granted to the petitioner. Mr. Agarwal submitted that this Court has not only power to grant amendment in regard to the subsequent events having bearing on the ultimate decision of the case but will be perfectly justified to take notice of subsequent events even if not pleaded if they have a bearing upon the relief to be granted to the petitioner. He further urged that the order of summary assessment is merely a consequential order and he had asked for a writ of prohibition which continues till the controversy is decided and cannot be said to be a substitution of a new cause of action. He has placed reliance on Lakshmiah vs. Krishnaswami (4), Harprasad vs. Lala Sitaram (5), A.N. Shah vs. A. Annapurnamma (6), Satish Chandra vs. State of W. Bengal (7), Kanna vs. Chirudu (8), Gulabchand vs. Krishna (9) and Vallamal vs. Gounder (l0). 9. Mr. S.K. Mal Lodha on behalf of the respondents has on the other hand argued that the proposed amendment under category II amounts to a substitution of action of a new cause of action in place of the old one and such an amendment is not permissible under the law, more specially in the writ jurisdiction. In this connection he referred us to Ma Shwe Mya vs. Maung Mo Hnaung (3) and B.N. Saoji vs. State of M.P. (l 1). The argument of Mr Lodha is that the facts relating to the passing of the order of summary assessment constituted a distinct cause of action and should not be allowed by way of substitution of the old one. The authorities cited by Mr. Agarwal do contemplate the amendment of the plaint by reason of subsequent events if the relief claimed has become inappropriate and when it is necessary to shorten the litigation or to do complete justice between the parties but none of the authorities relate to the amendment of writ petitions between the parties. Even such amendment cannot be allowed as a matter of course. It is in the discretion of the court to allow amendment by way of introduction of subsequent events if in its opinion it is just and necessary for finally deciding controversy between the parties. In Rajeshwardayal vs. Padamkumar Kothari (13) Jagat Narain, J had occasion to consider this aspect of the matter. It is in the discretion of the court to allow amendment by way of introduction of subsequent events if in its opinion it is just and necessary for finally deciding controversy between the parties. In Rajeshwardayal vs. Padamkumar Kothari (13) Jagat Narain, J had occasion to consider this aspect of the matter. It has been held in that case that amendment introducing cause of action arising subsequent to filing of suit cannot be allowed except in exceptional cases. The learned Judge had examined some of she authorities cited by the learned counsel and was of the opinion that it is only in exceptional circumstances that the court may allow an amendment of the plaint as to include the cause of action which had not accrued on the date of the institution of the proceedings, and that too under the inherent power of the High Court and not under O. 6 r. 17 C.P.C.B.N. Saoji vs. State of M. P. (11) is an authority directly in point. That case related to a petition for an order in the nature of amendment under Art. 226 of the Constitution of India for compelling the State Government to publish the report of Chhuikhadan Enquiry Commission, presided over by Justice B. Chaudhari and the report of Niyegi Committee which was subsequently appointed. The petition was confined only to two reliefs and was filed on 9-12-54. The petitioner put an application asking for an amendment of the original petition by including therein a reference to the opinions UPSC. on which the Governmental action was founded. It was held that an application for amendment of a petition under Art. 226 should not lightly be allowed. An altogether new and different relief not thought of at the time the petition was made and arising out of changed circumstances must be claimed by another petition and in this view of the matter the amendment application was refused. Having given our careful consideration to the respective contentions of the parties in this behalf, we are of the view that it would not be appropriate to allow the amendment by way of introduction of a new cause of action in regard to the subsequent facts leading to order u/s. 132(5) and its quashing by way of an amendment in exercise of our extraordinary jurisdiction. Before leaving this point we may, however, refer to the case reported in P.K. Nair vs. I.T.O. (Ker.)(13) brought to our notice by an application after the final arguments were concluded. In that the petitioner filed a writ petition challenging the notice u/s. 148 of the Income-tax Act. The basis on which the notices were issued to the assessee was that a certain amount of income had escaped for the five assessment years. While the writ petition was pending the assessments were complete. It was found that there was no jurisdiction to take action under sec. 147 of the Act. It was, therefore, held that the whole proceedings were vitiated as without jurisdiction and necessarily the assessment order followed, such action could not stand. The court, therefore, quashed the reassessment notice and the consequent assessments which were made. This line of course was also adopted in Calcutta Discount Co. Ltd. vs. Income-tax Officer (14). This case does not relate to amendment and is clearly distinguishable. If the action of the respondent is ultimately found to be without jurisdiction on final hearing then this Court may consider the matter if it finds the entire action of the respondents without jurisdiction. But that authority in no way supports the learned counsel seeking the amendment. We are, therefore, not inclined to grant amendment by allowing introduction of post writ facts and relief in regard to the quashing of assessment order passed under sec.132 (5) of the Income-tax Act. Proposed amendments mentioned under second category are, therefore, disallowed. 10. The new additional grounds categorised under category III are legal grounds and are in no way inconsistent or prejudicial to the other side and appear to be necessary before us. There can be therefore, no objection to allow incorporation thereof by way of amendment. The proposed amendments mentioned under category III are, therefore, allowed. 11. In the result, the amendments under categories I and II are disallowed and amendments in category HI are allowed. The amendment applications, therefore, stand disposed of in terms indicated above. This decision will mutatis mutandis govern the decision of the amendment applications in other three cases. The parties are, therefore, directed to renumber their paragraphs in the light of the amendment order. 12. We now come to the second application moved on behalf of the respondents. The amendment applications, therefore, stand disposed of in terms indicated above. This decision will mutatis mutandis govern the decision of the amendment applications in other three cases. The parties are, therefore, directed to renumber their paragraphs in the light of the amendment order. 12. We now come to the second application moved on behalf of the respondents. It has been stated in that application that after the rejection of the stay application of the petitioner in each case by this Court the officer concerned with the previous approval of the Commissioner of Income-tax Rajasthan Jaipur had passed the order u/sec.132 (5) of the Income-tax Act and therefore, all the four writ petitions of prohibition have become infructuous. It has further been argued that the petitioner has moved an application under sec.132 (ii) to the Central Board of Direct Taxes and is pursuing remedy under the statute. We are not inclined at this stage to go into the aspect of the matter. The reasons for this are obvious: Firstly, the answer to the writ application has not yet been filed. In absence of pleadings before us we do not think it advisable to decide the point raised in an isolated manner as such a course is not at all contemplated under the Rules of pleadings. The points taken in this application can well be taken in the reply to the writ petition. It will be thereafter that the Court can arrive at a final decision after considering the overall facts and circumstances of the case as a whole. In our view it is not just and fair to decide the writ application piecemeal. 13. We, therefore, do not feel inclined to give our decision on the respondents application under sec. 151 C.P.C. and reserve the same for our examination at the time of the final decision.