In Re: Mohanlal

B. S. Somasundaram, J.—On the 19th November, 1970, the Inspector of Police attached to the P. I. B. , C. I. D., Madras, stopped the

bus M. L. J. 4300 near Guindy and arrested one A. K. Ramu on suspicion u/s 54 of the Criminal Procedure Code. He seized from him Rs.

1,12,000 (currency notes). Ramu who was sent to Court was remanded to custody . Later, he was released on bail by the Court on 21st

November, 1970. The amount seized was not sent to Court. But on the same day, it was taken away from the Police Station by the Assistant

Director of Inspections (income tax Intelligence) under the authority of a warrant issued by the Commissioner of Income Tax u/s 132 of the

Income Tax Act, 1961. Mohanlal, the present petitioner, filed an application before the Chief Presidency Magistrate, for the return of this amount.

Observing that the matter does not fall within the purview of Section 523, Criminal Procedure Code, the learned Magistrate dismissed his

application. The correctness of this order is now canvassed in this revision.

u/s 523, Criminal Procedure Code, when such a seizure is done by a Police Officer, he should forthwith report the matter to the Magistrate and

the latter should make such orders as he thinks fit, respecting the disposal of such property, or the delivery of the property to the person entitled to

the possession thereof, or if such person cannot be ascertained, respecting the custody and production of such property. Ramu was arrested by

the Inspector with the amount on suspicion. He was sent for remand to Court. The currency notes were not sent but they were retained in the

police station. Those notes were taken away from the station by the Assistant Director of Inspections under the authority of a warrant issued by the

Commissioner of Income Tax u/s 132 of the Income Tax Act. Later, the Commissioner had issued a notice to the petitioner u/s 132 (5) read with

Section 132 (7) of the Income Tax Act. The petitioner participated in this enquiry and the Commissioner had passed an order directing the return

of Rs. 44,240 to the petitioner. The balance of the amount is now with him awaiting disposal as provided for in Section 132 (a) of the Income Tax

Act. The Income Tax Officers have thus seized the amount under the authority conferred on them by the statute. They have powers to deal with

the seizures and deposits under the provisions of that Act. The proceedings before the Income Tax authorities are not criminal proceedings and the

Income Tax authority is not a Court. Vide Balwant Singh and Another Vs. L.C. Bharupal, Income Tax Officer, New Delhi and Another, . As

pointed out by their Lordships of the Supreme Court in State of West Bengal Vs. S.N. Basak, , this statutory power cannot be interfered with by

the exercise of powers u/s 439 or under the inherent powers of the Court u/s 561-A, Criminal Procedure Code, when there was no case pending

at the time excepting that the person against whom the investigation has started had appeared before the Court, had surrendered and had been

admitted to bail. This was a case which related to the powers of interference with the statutory right of investigation conferred upon the police u/s

156 of the Criminal Procedure Code. In AIR 1945 18 (Privy Council) their Lordships of the Privy Council observed as below:

The functions of the judiciary and police are complementary, not overlapping and the combination of indivdual liberty with due observance of law

and order is only to be obtained by leaving each to exercise its own function, always, of course, subject to the right of the Court to intervene in an

appropriate ease, when moved u/s 491, Criminal Procedure Code, to give directions in the nature of habeas corpus. The Court''s functions begin

when a charge is preferred before it and not until them, and therefore, the High Court can interfere u/s 561-A only when a charge has been

preferred and not before.

Granting that the Inspector of the Income Tax authorities exceeded his jurisdiction, one in seizing this amount and the other in handing over the

same, even then whatever remedies the petitioner might have, the remedy will not be u/s 561-A, Criminal Procedure Code.

There are two kinds of properties that are dealt with under the Criminal Procedure Code, firstly, those that are seized by the police and

produced before the Court during enquiry or trial and secondly, those which are seized by the police and not produced during the enquiry or trial.

The police are empowered to seize the properties during the course of the investigation. Section 523 enjoins a duty on them to report the matter to

the Magistrate. If the property is produced before the Court, the Court is empowered to pass an order in respect of it u/s 516-A or u/s 517,

Criminal Procedure Code. But if the property is not produced before the Court, but remains with the police, then, as pointed out in Basava Kom

Dyamangouda Patil v. State of Mysore and Ors. (1970) M.L.J. (Cri.) 804 u/s 523, Criminal Procedure Code, power is given to the Court to

make such order as it thinks fit respecting the disposal of such property. In any case, the property must be available. Even assuming that due to

negligence of the Police Officers, the property was stolen and it was not detected so long as the property is not available, the Magistrate cannot

make an order u/s 517, Criminal Procedure Code, nor could any direction be given for the return of the value thereof by virtue of the powers u/s

561-A, Criminal Procedure Code.

Here, in this case, the property is not available with the police. Under the authority of a warrant issued by the Commissioner of Income Tax the

Officers of that department have taken custody of this amount from the police station. Proceedings ate now pending before the Commissioner of

Income Tax. These proceedings are not criminal proceed-dings. No case is now pending before any Court. The statutory powers conferred on the

Income Tax authorities to deal with the seizure canot be interfered with by the exercise of the powers u/s 439 or under the inherent powers of the

Court u/s 561-A of the Criminal Procedure Code. The petitioner in this case prays for an order directing the Commissioner of I none-tax to return

the amount seized to him. For the reasons given above, no such direction can be given.

The revision fails and the same is dismissed.