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PETITIONER: COMMISSIONER OF INCOME TAX BHUBANESHWAR & ANR.

       Vs.

RESPONDENT: PARMESHWARI DEVI SULTANIA & ORS.

DATE OF JUDGMENT:       06/03/1998

BENCH: SUJATA V. MANOHAR, D.P. WADHWA

ACT:

HEADNOTE:

JUDGMENT:                  THE 6TH DAY OF MARCH, 1998 Present :               Hon’ble Mrs. Justice Sujata V. Manohar               Hon’ble Mr. Justice D.P. Wadhwa Ranbir Chandra, C.V.S. Rao, (Ms. Shashi Kiran) Adv. for B.K. Prasad, Advs. for the appellants N.K. Bisht, Adv (NP), for the Respondents Joseph Vellapally,  Sr. Adv., and R.K. Kapoor, Adv. with him for the Amicus Curiae appointed by the Courts.                       J U D G M E N T The following judgment of the Court was delivered: D.P. Wadhwa, J.      Commissioner of  Income Tax,  Bhubaneshwar and Union of India, Ministry  of Finance  have filed  this appeal against the judgment dated October 24, 1994 of the Orissa High Court which the  High Court  dismissed their revision and affirmed the order of the subordinate court rejecting the plea of the Revenue that  a  suit  for  partition  filed  by  the  first respondent was  not maintainable  in view  of the  bar of in Section 293  of the  Income Tax  Act, 1961  (for short,  the ‘Act’).      Respondent No.1,  as the  plaintiff, filed  a suit  for partition against  7 defendants,  defendants 6  and 7  being respectively Union  of India  through Finance  Secretary and Commissioner of Income Tax, Orissa, now the appellant before us. Defendants 1 and 2 are step-brothers and defendants 3 to 5 are step-sisters of the plaintiff. Plaintiff said that she was the  daughter of  Bansidhar Agarwal from his first wife, while defendants  1 to  5 were  the  children  of  Bansidhar Agarwal from  his second  wife. Defendant  No. 1  is Babulal whose residential  and business  premises were  subjected to search and  seizure assets including certain gold ornaments, subject   matter of  the suit  filed by  the plaintiff, were seized. In  the suit  the plaintiff had prayed for partition of those very gold ornaments. Plaintiff said that her mother died in  1938 and that at that time she was possessed of 200 tolas of  gold ornaments  which was her stridhan. Her mother made a  will bequeathing gold ornaments to the plaintiff and other  children   of  Bansidhar  form  his  second  wife  in proportion to  number of  daughters of each of such children

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to meet  the dowry demand and marriage requirements of their daughters. These  ornaments were  kept  in  the  custody  of father of the plaintiff who died on February 10, 1990. After his death  the ornaments  came in  the  custody  of  Babulal Agarwal,  the    first  defendant.  The  family  decided  to partition the  ornaments. At  that time there were 14 grand- daughters who  were  the  daughters  of  the  plaintiff  and defendants 1  to 5.  Since the plaintiff had 5 daughters she was entitled  to 5/14th  share in  the ornaments. But before the partition  could take  place, Income  Tax Officer raided the house  of the  first defendant  on March  23,  1990  and seized those  gold ornaments  which weighed  2128 gms. along with other  assets. Plaintiff said that she filed a petition before the  Income Tax  Officer for  return of the ornaments but he  refused. The  plaintiff then  issued a notice to the Commissioner of  Income Tax, Orissa, defendant No.7, who, it is alleged,  assured her  that justice  would be done to her claim and  had stated  that her  case would  be disposed  of within three  months.  Nothing  happened  in  spite  of  the reminders and  no decision  was taken.  This gave  cause  of action to  the plaintiff.  She served a notice under Section 80 of  Code of  Civil Procedure  on Defendants  6 and  7 and thereafter filed the suit.      From the  facts, it is quite obvious that the plaintiff would not  have filed the suit for partition as there was no dispute to  her claim  by other  relatives but  for the fact that gold  ornaments were  then in the custody of the Income Tax  Department.   Notices  of   the  suit  were  served  on Defendants 6  and 7.  They filed an application in the Court on August  7, 1992  challenging the  very maintainability of the suit  in view  of Section 293 of the Act. The Section is as under :      "293. Bar of suits in civil courts.      No suit  shall be  brought  in  any      civil court  to set aside or modify      any proceeding  taken or order made      under this Act, and no prosecution,      suit or  other 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."      As to  why the suit was not maintainable, reference was made to  the operations  conducted under  Section 132 of the Act and the order passed in those proceedings under the Act. Under the authorisation issued by the Director of Income Tax (Investigation), Hyderabad  under sub-section (1) of Section 132, search  and seizure  operations were  conducted in  the residence-cum-business premises  of Babulal  and also at the business premises  of a company of which he was the Managing Director. Two  bank lockers  in the name of  plaintiff would not have  filed the  suit for  partition  as  there  was  no dispute to  her claim  by other  relatives but  for the fact that gold  ornaments were  then in the custody of the Income Tax  Department.   Notices  of   the  suit  were  served  on Defendants 6  and 7.  They filed an application in the Court on August  7, 1992  challenging the  very maintainability of the suit  in view  of Section 293 of the Act. The Section is as under :      "293.  Bar   of  suits    in  civil      courts. No suit shall be brought in      any civil  court to  set  aside  or      modify  any   proceeding  taken  or      order made  under this  Act, and no

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    prosecution,    suit    or    other      proceedings 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."      As to  why the suit was not maintainable. reference was made to  the operations  conducted under  Section 132 of the Act and the order passed in those proceedings under the Act. Under the authorisation issued by the Director of Income Tax (Investigation), Hyderabad  under sub-section (1) of Section 132, search  and seizure  operations were  conducted in  the residence-cum-business premises  of Babulal  and also at the business premises  of a company of which he was the Managing Director. Two  bank lockers  in the name of  Babulal and his brother Girdharilal  in the  Andhra Bank were also searched. These search  operation were  carried on from March 23, 1990 to March  26,  1990.  Case,  Jewellery,  diamond  ornaments, silver coins  and ingots were found and seized. Statement of Babulal was recorded under sub-section (4) of Section 132 of the Act.  In respect  to cash and jewellery Babulal admitted having concealed income of Rs. 7,00,000/- which according to him was  the value  of the gold ornaments found in excess of 515 tolas  which had  been disclosed  by him  and his family members in  his wealth-tax  return. He offered an additional income of  Rs. 3,50,000/- in his name and the same amount in the name of his brother on account of undisclosed investment in acquisition  of gold  ornaments.  During  the  course  of investigation,  Babulal   also  gave   written   submission, Regarding gold  ornaments,  his  stand  now  was  that  gold ornaments weighing  2128 gms. belonged to Mani  Devi who was the first  wife of  his father  and as  per her wished, h is father was  the custodian of this jewellery on behalf of the plaintiff who  was the  only daughter of his father from his first wife  and also  on behalf of the children to be gotten after remarriage of his father. His contention was that this jewellery had  been kept by his father who was now no longer alive. After completion of the investigation, the Income Tax Officer passed  an order  under Section  132(5) of  the  Act holding that  total liabilities  on account of tax, interest and penalty of Babulal came to Rs, 56,079/- as against which value of  the assets  seized during the course of search and seizure operation  which  included  the  gold  ornaments  in question to  be retained with the Department. The Income Tax Officer disbelieved  the version  of the  Babulal that  gold ornaments in  question were owned by his step-mother and how she wished  to distribute  the same  among her  daughter and other children  that may  be born  to the second wife of her husband. According  to Babulal,  as per  his second version, the gold  ornaments remained  in the  custody of  his father from 1938  till 1990, when he died without these having been utilised as  per the  wishes  of  his  step-mother,  natural mother of  the plaintiff.  The assets  retained by the order under sub-section (5) of Section 132 are to be dealt with in accordance with the provisions of Section 132B of the Act.      An order  was passed  under sub-section  (5) of Section 132 of  the Act  can be  objected to  under sub-section (11) thereof to  the Commissioner  of Income  Tax. We may set out Section 132, in the relevant part, as under :      "132. Search and seizure.- (1)...      (2) ...      (3) ...      (4)  The  authorised  officer  may,      during the  course of the search or      seizure, examine on oath any person

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    who is found to be in possession or      control of  any books  of  account,      documents,     money,      bullion,      jewellery or other valuable article      or thing  and any statement made by      such person during such examination      may thereafter  be used in evidence      in any  proceeding under the Indian      Income tax  Act, 1992 (11 of 1922),      or under this Act.      Explanation :  For the  removal  of      doubts, it  is hereby declared that      the examination of any person under      this sub-section  may be not merely      in respect of any books of account,      other documents  or assets found as      a result of the search, but also in      respect of all matters relevant for      the  purposes   of  any  proceeding      under the  Indian  Income-tax  Act,      1922 (11  of 1922),  of under  this      Act.      (4A) Where  any books  of  account,      other  documents,  money,  bullion,      jewellery or other valuable article      or thing  are or  is found  in  the      possession or control of any person      in the  course of  a search, it may      be Presumed--      (i) that  such  books  of  account,           other    documents,     money,           bullion,  jewellery  or  other           valuable  article   or   thing           belong  or   belongs  to  such           person;      (ii)  that  the  contents  of  such           books  of  account  and  other           documents are true; and      (iii) that  the signature and every           other part  of such  books  of           account  and  other  documents           which  purporting   to  be  he           handwriting of  any particular           person or which may reasonably           be assumed to have been signed           by,   or    to   be   in   the           handwriting of, any particular           person, are  in that  person’s           handwriting of, any particular           person, are  in that  person’s           handwriting, and  in the  case           of   a    document    stamped,           executed or  attested, that it           was duly  stamped and executed           or attested  by the  person by           whom it  purports to have been           so executed or attested.      (5)  Where   any  money,   bullion,      jewellery or other valuable article      or thing  hereafter in this section      and  in   sections  132A  and  132B      referred to as the assets is seized      under  sub-section   (1)  or   sub-      section   (1A),    the   Income-tax      Officer,    after    affording    a

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    reasonable   opportunity   to   the      person concerned of being heard and      making  such   enquiry  as  may  be      prescribed,   shall,   within   one      hundred  and  twenty  days  of  the      seizure, make  an order,  with  the      previous  approval  of  the  Deputy      Commissioner .--      (i)  estimating   the   undisclosed           income (including  the  income           from the  undisclosed property           in a  summary  manner  to  the           best of  his judgment  on  the           basis of such materials as are           available with him;      (ii) calculating  the amount of tax           on the  income so estimated in           accordance with the provisions           of the  Indian Income-tax Act,           1922 (11  of  1922),  or  this           Act;      (iia)  determining  the  amount  of           interest   payable   and   the           amount of penalty imposable in           accordance with the provisions           of the  Indian Income-tax Act,           1922 (11  of  1922),  or  this           Act, as  if the order had been           the    order     of    regular           assessment;      (iii) specifying  the  amount  that           will be  required  to  satisfy           any existing  liability  under           this Act  and any  one or more           of  the   Acts  specified   in           clause (a)  of sub-section (1)           of section  230A in respect of           which  such   person   is   in           default or  is deemed to be in           default,      and  retain  in  his  custody  such      assets or  part thereof  as are  in      his opinion,  sufficient to satisfy      the  aggregate   of   the   amounts      referred to in clauses (ii),, (iia)      and (iii) and forthwith release the      remaining portion,  if any,  of the      assets to  the  person  from  whose      custody they were seized :      Provided that it, after taking into      account  the   materials  available      with him,  the materials  available      with him, the Income-tax Officer is      of the view that it is not possible      to ascertain  to  which  particular      previous year  or years such income      or any part thereof relates, he may      calculate the tax on such income of      part, as  the case  may be,  as  if      such income  or part were the total      income chargeable  to  tax  at  the      rates in  force  in  the  financial      year  in   which  the  assets  were      seized and  may also  determine the      interest  or   penalty,   if   any,

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    payable or imposable accordingly :      Provided  further   that  where   a      person    has    paid    or    made      satisfactory    arrangements    for      payment of all the amounts referred      to in  clause (ii), (iia) and (iii)      or any part thereof, the Income-tax      Officer  may,   with  the  previous      approval of  the Chief Commissioner      or Commissioner, release the assets      or such part thereof as he may deem      fit in  the  circumstances  of  the      case.      (6) The  assets retained under sub-      section (5)  may be  dealt with  in      accordance with  the provisions  of      section 132B.      (7) If  the Income-tax  Officer  is      satisfied that the seized assets or      any part  thereof were held by such      person, for  or on  behalf  of  any      other   person,    the   Income-tax      Officer  may   proceed  under  sub-      section  (5)   against  such  other      person and  all the  provisions  of      this    section     shall     apply      accordingly.      XXX          XXX              XXX      (11) If  any person objects for any      reason to  an order made under sub-      section, he may, within thirty days      of the  date of such order, make an      application    to     the     Chief      Commissioner    or    Commissioner,      stating  therein  the  reasons  for      such objection  and requesting  for      appropriate relief in the matter.      132B.   Application   of   retained      assets--      (1) The  assets retained under sub-      section (5)  of section  132 may be      dealt with in the following manner,      namely :-      (i)  The  amount  of  the  existing           liability   referred   to   in           clause (iii)  of the said sub-           section and  the amount of the           liability    determined     on           completion  of   the   regular           assessment or reassessment for           all   the   assessment   years           relevant to the previous years           to which  the income  referred           to in clause ((i) of that sub-           section relates  including any           penalty  levied   or  interest           payable  in   connection  with           such       assessment       or           reassessment and in respect of           which he  is in  default or is           deemed to be in default may be           recovered out of such assets.      (ii) If  the assets  consist solely           of money,  or partly  of money           and partly  of  other  assets,

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         the  Assessing   Officer   may           apply  such   money  in  t  he           discharge of  the  liabilities           referred to  in clause (i) and           the    assessee    shall    be           discharged of  such  liability           to the  extent of the money so           applied.      (iii) The  assets other  than money           may also  be applied  for  the           discharge    of    any    such           liability   referred   to   in           clause    (1)    as    remains           undischarged  and   for   this           purpose such  assets shall  be           deemed to  be under  distraint           as  if   such  distraint   was           effected  by   the   Assessing           Officer of,  as the  case  may           be, Tax Recovery Officer under           authorisation from  the  Chief           Commissioner under sub-section           (5) of  section  226  and  the           Assessing Officer  or, as  the           case  may   be,  Tax  Recovery           Officer may recover the amount           of  such  liabilities  by  the           sale of  such assets  and such           sale shall  be effected in the           manner laid  down in the Third           Schedule.      (2)  Nothing   contained  in   sub-      section  (1)   shall  preclude  the      recovery   of    the   amount    of      liabilities aforesaid  by any other      mode lain down in this Act.      (3) Any  assets or proceeds thereof      which remain  after the liabilities      referred  in  clause  (i)  of  sub-      section (1) are discharged shall be      forthwith made  over or paid to the      persons  from   whose  custody  the      assets were seized.      (4)(a) The Central Government shall      pay simple  interest at the rate of      fifteen per  cent per  annum on the      amount by  which the  aggregate  of      money retained  under  section  132      and of the proceeds, if any, of the      assets sold  towards the  discharge      of the  existing liability referred      to in  clause (iii)  of sub-section      (5) of  that  section  exceeds  the      aggregate of  the amounts  required      to meet  the labilities referred to      in clause (i) of sub-section (1) of      this section.      (b) Such  interest shall  run  from      the date  immediately following the      expiry of  the period of six months      from the  date of  the order  under      sub-section (5)  of section  132 to      the date  of the regular assessment      of  reassessment   referred  to  in      clause (i)  of sub-section  (1) or,

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    as the  case may be, to the date of      last   of   such   assessments   or      reassessments."      In view of the proceedings conducted  under Section 132 of the  Act and  order having  been passed under sub-section (5) of  Section 132  thereof and seized assets including the gold ornaments,  subject matter  of the  suit ordered  to be retained, the Revenue objected to the maintainability of the suit and  said that  it was clearly barred by Section 293 of the Act  and a civil court had no jurisdiction to try such a suit under Section 9 of the Code of Civil Procedure. Section 9 of  the Code  imparts jurisdiction on a civil court to try of suits  of the  civil nature excepting suit of which their cognizance is either expressly or impliedly barred.      The Subordinate  Judge framed and tried the preliminary issue on  the maintainability  of the suit. He observed that Section 293  of the  Act could  not be a blanket bar for all types of civil suit brought for redress against infringement of a  legal right  for which  no remedy was prescribed under the Act. According to him, the claim of the plaintiff as set out in  the suit  had not been adjudicated by defendant No.7 and on  that account  legal right  of  the  plaintiff  stood violated and she suffered legal injury which entitled her to judicial process  to file  a suit.  Thus, according  to  the learned Subordinate Judge, there is no remedy in the Act for redressal of  the grievance  of the plaintiff and the relief which the plaintiff claimed in the suit could not be granted to her  in the  Act. He,  therefore, held  the  suit  to  be maintainable. Commissioner  of Income Tax and Union of India aggrieved of this order filed  a revision in the Orissa High Court. The  learned Single  Judge upheld  the order  of  the Subordinate Judge and dismissed the revision. High Court did note the fact that the plaintiff filed a petition before the Income Tax  Officer for  returning the seized gold ornaments but the  prayer was refused and that thereafter she issued a notice to  the Commissioner  of Income  Tax  and  when  that yielded no  result, she  filed the suit for partition of the suit properties.  High Court  also noticed  that  the  order passed under  sub-section (5)  of Section 132 of the Act was not appealed  against and  had become final and further that the assessment  proceedings were  still pending  before  the Deputy Commissioner,  Income Tax  (Assessment).  High  Court referred to  a decision of this Court in Dulhabhai vs. State of Madhya  Pradesh [(1968)  3 SCR  662 -  AIR  1969  SC  78] wherein seven  principles were laid down regarding exclusion of jurisdiction  of a  civil court.  According to  the  High Court, the  suit filed by the plaintiff was not to set aside or modify  the order  passed by the Income Tax Officer under Section 132(5)  of the  Act and  had she filed 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.  A perusal of entire provision of Section 132 would show that it did not give finality to any order passed under sub-section (5) thereof, though the order could be varied or modified by  the Chief  Commissioner or Commissioner, as the case may be, but even that order did not give finality under the Act. High Court said that :      "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 (11)      of Section  132 would  be  able  to

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    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  same 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."      High Court also held that although Section 132 provided for a  remedy by way of challenge before the named authority under sub-section  (11) of Section 132 of the Act, plaintiff could not  redress  her  grievance  because  the  relief  of partition claimed by her in the suit could not be granted by the statutory machinery provided in the Act.      We do  not think  that the  High Court  approached  the question in  its proper  perspective. It  failed to consider the effect  of the decree if passed in the suit on the order under Section  132(5) of  the Act or other proceedings under Section 132B  of the Act. When Section 293 originally stood, it provided  that "no  suit shall  be brought  in any  civil court to  set aside  or modify  any assessment or order made under this  Act". The  word "assessment" was omitted and the words "proceeding  taken" were  inserted in  its place. This made the section more comprehensive in nature. Direct effect of the  decree in the suit would be that the gold ornaments, subject matter of this suit, would be taken out of the order of the  Income Tax  Officer under Section 132 (5) of the Act and would  not be  available to  be applied  in  proceedings under Section  132B of  the Act.  It is  immaterial  if  the proceeding under  Section 132 gives no finality to the order passed under  Section 132  (5) of  132(11) of the Act. It is not the  case of  the Revenue  that Income Tax Authority can grant decree  for partition. It is not also material for the decision of the case if the will now set up by the plaintiff was genuine  or not.  The question  that felt  squarely  for consideration was  the right  or the  plaintiff as  a  third party in the proceedings under Section 132 of the Act. If we analyse the section, the following steps are visualise :      "(1) search  is conducted under the      authorisation    of    the    named      authority;      (2) seizure of the assets, books of      accounts,   documents    etc.    in      pursuance thereto;      (3) to  examine on  oath any person      during  the  course  of  search  or      seizure operations  who is found to      be in  possession or control of any      of the  assets, books  of  account,      documents etc.;      (4) statements  so recorded  can be      used in  evidence in any proceeding      under the Act;      (5) there  is  a  presumption  that      assets,   books   of   account   or      documents found  in control  of any

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    person  in  the  course  of  search      belong  to     him   and  that  the      contents of  books of  account  and      documents   are   true   and   that      signatures, books  of  account  and      documents which  purported to be in      the  writing   of  any   particular      person are  signed or  in the hand-      writing of that particular person;      (6) after  affording  a  reasonable      opportunity  of   being  heard  and      after making enquiry as prescribed,      the Income  Tax Officer  is to pass      an  order   keeping  in   view  the      requirements of  sub-section (5) of      Section 132 of the Act;      (7)  if   the  Income  Tax  Officer      passes  order   for  retention   of      assets, these  are to be dealt with      in accordance with Section 132B;      (8) if  the Income-tax  Officer  is      satisfied that the seized assets or      any part  thereof  belongs  to  any      other   person,    the   Income-tax      Officer  may   proceed  under  sub-      section  (5)   against   any   such      person; and      (9) if  any person  objects for any      reason to the order made under sub-      section (5),  he can  approach  the      Chief Commissioner  or Commissioner      for redressal of his grievance.      A perusal  of the  order passed  under  Section  132(5) would show  that the  Income-tax Officer  was not  satisfied that the subject gold ornaments belonged to any other person and not to Babulal. It was, therefore, not necessary for him to proceed  under sub-section (7) of Section 132 of the Act. However, the  plaintiff was  well aware  of the  proceedings under Section  132  and  she  did  approach  the  Income-tax Officer, as  aforesaid, who  rejected her  petition. In  any case, she  could have  approached the  Chief Commissioner or Commissioner  under   sub-section  (11),   if  she  had  any objection for any reason to the order made under sub-section (5) of  Section 132  of the Act. We do not think sub-section (11) is  confined to  only that  person who was subjected to search and  seizure operation  and against  whom  the  order under sub-section  132(5) was passed. The words "any person" appearing in  sub-section (11) of Section 132 of the Act are significant and  even a  third party can made an application to the Chief Commissioner or Commissioner giving reasons for his objection to the order and seeking appropriate relief in the matter.  This remedy  the plaintiff  did not avail. When the plaintiff  was unable  to get  the release of the seized gold ornaments, allegedly belonging to her mother, under the provisions of  the Act, she could not be filling a partition suit indirectly get a decree to have a finding that the gold ornaments belonged  to her  mother and that she had right to claim her  share therein.  If she succeeds in her claim this will have direct effect of getting that order of the Income- tax Officer  under Section  132(5) of  the Act  set aside or modified to  that extent.  This Section 293 does not permit. The decree if passed in a suit would  not only effect 5/14th share of the plaintiff which she was seeking on partition of the gold ornaments, but also whole of the ornaments weighing 2128 gms would get effected and taken out of the order under

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sub-section (5)  of Section  132 of the Act. Mr, Vellapalli, who at  out request,  appeared amicus  curiae submitted that one had  to see  if the  suit was  filed before or after the conclusion of  the assessment  proceedings. He said it was a suit for  title and  not, in  any way, for setting aside the order passed  by the  Income-tax officer,  even though  as a consequence of  an ultimate  decree,  it  might  affect  the working of  that order.  He said  form of the suit was to be seen if  it is maintainable or not and that the jurisdiction of the  civil court  is decided  as to  how suit  is framed. According  to  Mr.  Vellapalli,  purpose  of  of  Income-tax proceedings  is  to  determine  the  tax  liability  of  the assessee and  if liability  is created, then to recover that and assets  are to  be retained  but that  was not  an issue before the  civil court.  He also  referred to Schedule 2 of the Act  to contend  that the  Act did  not altogether bar a civil suit.  It is  difficult to accept such submissions. We think Section  293 is  quite specific  and does not admit of any ambiguity  if ultimately a suit is to result in a decree or order  which sets  aside or modifies any proceeding taken or order  made  under  the  Act,  that  suit  would  not  be maintainable. We  are not  concerned with  the frame  of the suit as  such but  to see  the ultimate  result to which the suit as  such but  to see  the ultimate  result to which the suit  would   lead  to.   In  the  present  case,  both  the Commissioner of  Income-tax and  Union of  India  have  been impleaded as  defendants. On  pleadings of  the parties,  an issue will  have to be framed on the validity of proceedings under Section  132 of  the Act  which cannot be permitted in view of the bar contained in Section 293 of the Act.      In Raleigh Investment Co., Ltd. vs. Governor-General in Council [(1947) 15 ITR 332 (PC), a suit was filed by Raleigh Investment Company  Ltd. claiming  repayment of  Rs. 4,  35, 295/-, part  of a  larger sum paid by it under an assessment of Income-tax made upon it. The basis of this claim was that in the  computation of  assessable income,  effect had  been given to  a provision  of the  Income-tax Act, 1992 which in the  submission   of  the  plaintiff  was  ultra  vires  the legislature and  that the  assessment was, therefore, wrong. One of the contention raised was that the suit was barred by reason of Section 67 of the Income Tax Act, 1922. Section 67 contained bar  of suits  in civil court. Section 67 provided as under :      "67. Bar  of suits in Civil Court.-      No suit  shall be  brought  in  any      Civil Court  to set aside or modify      any assessment made under this Act,      and no  prosecution suit  or  other      proceeding shall  lie  against  any      officer  of   the  Government   for      anything  in  good  faith  done  or      intended  to  be  done  under  this      Act." The Court  held that  though in  form the relief claimed did not profess  to modify  or  set  aside  the  assessment,  in substance  the   suit  was   directed   exclusively   to   a modification of  the assessment and was barred by Section 67 of the Indian Income-tax Act. In Kamala Mills Ltd. vs. State of Bombay [(1965) 56 ITR 643 (SC)], plaintiff, the appellant filed a  suit claiming  to recover  certain amount  paid  as sales tax  on the  ground that  it had been illegally levied against it.  One of  the questions  for consideration was if Section 20 of the Bombay Sales Tax Act, 1946 contained a bar against the suit. Section 20 is as under :      "Save as is provided in section 23,

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    no assessment  made  and  no  order      passed   under this    Act  of  the      rules  made   thereunder   by   the      Commissioner    of    any    person      appointed under section 3 to assist      him shall  b e called into question      in any  civil court, and save as is      provided in  sections 21 and 22, no      appeal or  application for revision      shall   lie    against   any   such      assessment or order."      It was  contended by  the plaintiff that Section 20 had no application  because the  order of  assessment which  the plaintiff sought  to challenge had been made by the relevant Sales  Tax  Authorities  without  jurisdiction.  This  Court repelled this  argument and said that an assessment based on an erroneous  finding about the character of the transaction was not  an assessment made without jurisdiction and was not outside the  purview of  Section 20  and that  words in that section were  wide enough  to take  within  its  sweep  even erroneous orders  of assessment  and would  be  entitled  to claim protection  against the  institution of  a civil suit. The court then observed :      "The jurisdiction  of a civil court      can be  excluded  even  without  an      express provision.  In every  case,      the question about the exclusion of      the jurisdiction  of  civil  courts      either expressly  or  by  necessary      implication must  be considered  in      the light  of the words used in the      statutory provision  on  which  the      plea  is   statutory  provision  on      which  the  pleas  is  rested,  the      scheme of  the relevant provisions,      their object and their purpose."      In State of Bombay (Now Gujarat) vs. Jagmohandas & Anr. [(1966) 60  ITR 206 206], the respondent-plaintiff had filed a suit against the State of Bombay for recovery of a certain amount which  it alleged  it h  ad paid  as advance  tax  on various dates,  while submitting  returns for  a  particular period. It also claimed interest. The State raised objection that the  suit was barred by Section 13 and 20 of the Bombay Sales Tax  Act, 1946.  This Court held that as no assessment had been  made under  the Act  was called in question in the suit Section  20 of the Act did not bar the suit. This Court also negatived  the contention  of the defendant that when a registered dealer filed a return and calculated and paid tax on the  basis of the return, he, in fact, made an assessment and, therefore,  brought himself  within Section  20 of  the Act. The Court said :      "We are  unable to  read  the  word      ‘assessment’  in   section  20   to      include a mere filing of return and      payment by  a registered dealer. In      our opinion,  the word "assessment"      has reference  to assessments  made      under section  11, and  11A of  the      Bombay   Sales   Tax   Act,   1946.      Therefore,  we  must  overrule  the      contention of the learned Solicitor      General that  section 20  expressly      bars the present suit."      It is  not necessary  for us  to consider  the scope of Section 13  referred to above as that is not relevant to the

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issue raised before us.      In Rangammal  & Ors.  vs. Union of India & Ors. [(1963) 48 ITR  598 (Mad)],  the appellants-plaintiffs had brought a suit for a declaration that property described in the plaint should not  be either  sold or  could be sold if at all only subject to  a charge  in favour  of the  sixth plaintiff for realisation of  income tax  arrears  due  from  their  elder brother and  for a  permanent   injunction  restraining  the Union of India and the Collector of Coimbatore from bringing those properties  to sale  for realisation of the income-tax arrears due.  It was  the contention  of the plaintiffs that the brothers were having their independent business and were not having  joint family businesses. However, the Income-tax authorities treated  all  the  businesses  as  joint  family business and  the  status  of  the  assessee  was  taken  as Undivided Hindu  Family. In  order to realise the arrears of income-tax, the properties, subject matter of the suit, were brought to sale. At that stage, the suit was filed. Earlier, it appeared  that  the  plaintiffs  had  filed  a  suit  for partition of  joint family  estate and  a preliminary decree was  passed   and  then  final  decree  where  some  of  the properties mentioned  in the plaint in the present suit were allotted to minor plaintiffs. One of the question raised was whether the  suit as  such was  barred by  Section 67 of the Income-tax Act,  1922. A  Division Bench  of the Madras High Court, after  examining the background of the case, observed that it  was true  that prayer in the plaint was not couched in terms  which would bar the operation of section 67 of the Income-tax Act  because the  prayer was for declaration that the properties  in question  were not liable to be proceeded against for  the satisfaction  of the  demand due  under the assessment. The Court said that merely by casting the prayer in the form a declaration, the substance of the prayer could not b  e hidden.  The Court held that the substance here was that the  share of  the minors  in the joint family property was not  liable for  the income-tax  arrears because the tax was assessed  on businesses  which  were  not  joint  family businesses. The   court,  thus, held  that Section 67 of the Act was a bar to the maintainability of the suit even though the declaration  asked for  did not  in  terms  referred  to cancellation of the assessment made by the tax authorities.      Principles of  law are, therefore, well settled where a civil court  will not assume jurisdiction. In Dulhabhai etc. vs. State  of Madhya  Pradesh & Anr. [(1968) 3 SCR 662 - AIR 1969 SC  78], this Court laid 7 principles for the courts to see if  the suit  was barred  under Section 9 of the Code or not. It  is not necessary to set out all the 7 principles as we find  that the  present suit  would be  barred under  the second principle  laid by  this Court  which we reproduce as under :      "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

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    see  if   the  statute   creates  a      special right  or a  liability  and      provides for  the determination  of      the right  of liability and further      lays down  that all questions about      the said  right and liability shall      be determined  by the  tribunals so      constituted, and  whether  remedies      normally associated with actions in      civil courts  are prescribed by the      said statute or not."      We have seen above that the scope of Section 293 of the Act has  been widened  now even  to include  any  proceeding under the  Act and  it is  not merely confined merely to set aside or  modify any order. From of suit is not relevant. It is the  substance which  is to  be seen.  When  the  statute prescribed certain  procedure and proceedings thereunder are held  and   order  passed,  it  is  difficult  to  accept  a contention that  proceeding and order can be modified or set aside in a civil suit filed by a third party. Section 293 is specific and  does not  admit filing of a suit which has the effect of  even indirectly  setting aside  or modifying  any proceeding taken  under the Act or order made thereunder. In the present  case, search  and seizure  were effected as per the provisions  of the  Act, assets and documents seized and statement of  Babulal  recorded  under  sub-section  (4)  of Section 132 of the Act wherein he admitted that the gold was acquired from  his and brother’s undisclosed income which he was even  prepared to surrender to tax. It was thereafter in the course of further enquiry that he came up with a version that the  gold ornaments  in question  belonged to his step- mother who  bequeathed the  same for the benefit of children of the  plaintiff and  other children  that would be born to the second  wife of  his father.  This version  did not find favour with  the Income-tax Officer and he was not satisfied that gold  ornaments in  question did not belong to Babulal. It was,  a therefore,  not necessary  for him  to issue  any notice under  sub-section (7)  of Section  132 of the Act to the plaintiff.  In any case, the plaintiff was well aware of the proceedings  before the Income-tax Officer and she could have also  filed objection  to the order made by the Income- tax Officer  under Section  132(5) of  the Act  to the Chief Commissioner or  Commissioner  under  Section  (11)  thereof which remedy  she  did  not  avail.  Considering  the  whole gravamen of  the plaintiff  in the  suit and  the law on the subject, we  are of  the opinion  that the Subordinate Judge and the  High  Court  were  not  correct  in  rejecting  the contention of  the Revenue and holding that the suit was not barred under Section 293 of the Act.      We, therefore,  allow the appeal set aside the impugned judgment of  the High Court and of the Subordinate Judge and dismiss the suit filed by the plaintiff.      We  would  like  to  record  our  appreciation  of  the assistance rendered  by Mr.  Vellapalli and  Mr.  Kapur  who appeared amicus curiae at our request.