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PETITIONER: TULSIRAM SANGANARIA & ANR.

       Vs.

RESPONDENT: SHRIMATI ANNI RAI & ORS.

DATE OF JUDGMENT07/01/1971

BENCH: GROVER, A.N. BENCH: GROVER, A.N. SHAH, J.C. (CJ) HEGDE, K.S.

CITATION:  1971 AIR  671            1971 SCR  (3) 310

ACT: Income-tax Act (11 of 1922), s. 54-Production of  assessment order  by  assessee or his representative-If  admissible  in evidence.

HEADNOTE: Section  54 of the Income-tax Act, 1922, created a  complete bar to the production by officials and other servants of the Income-tax  Department  of the documents  mentioned  in  the section.  But, where the assessee or his  representative-in- interest himself produces a copy of the incometax assessment order in any legal proceeding the order would be  admissible in evidence. [311H; 312 G-H; 31 B A] Emperor v. Osman Chotani (1942) 10 I.T.R. 429, Suraj  Narain v. Seth Jhabhu Lcl & Ors., (1945) 13 I.T.R. 13 and  Buchibai v. Nagpur University, (1947) 15 I.T.R. 150, approved. Charu Chandra Kundu v, Gurupada Ghosh, [1962] 2 S.C.R.  833, referred to.

JUDGMENT: ClVlL  APPELLATE  JURISDICTION: Civil Appeals Nos.  1001  to 1003 of 1965. Appeals from the judgment and decree dated December 22, 1961 of the Orissa High Court in First Appeals Nos. 82, 83 and 84 of 1958. Bishan  Narain and P. C. Bhartari, for the  ’appellants  (in all the   appeals). B. P. Maheshwari, for respondent No. 1 (in C.A. No. 1002 of   1965). Sadhu Singh and Jagmohan Khanna, for respondents Nos.  1  to 5 (in C.A. No. 1003 of 1965). The Judgment of the Court was delivered by Grover,  J. These appeals have been brought  by  certificate from a common judgment of the Orissa High Court. Five  different suits were filed against certain  defendants on the foot of five different pronotes.  All the five  suits were’  heard together and were decreed by the  trial  judge. In respect of two suits the valuation being low the  appeals were preferred before the District Judge and in three  suits the  appeals were filed in the High Court.  The  High  Court

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dismissed  the  appeals.  It is  altogether  unnecessary  to refer  to  the  points in controversy  between  the  parties because. the sole question which has been agitated before us relates to the admissibility of certain assessment orders 311 on  which reliance has been placed for deciding whether  the contesting  defendants  were the partners of  firm  Surajmal Manilal on whose behalf the pronotes had been executed.  The learned   subordinate   judge  had  found  that   the   suit transactions  were  genuine and execution on behalf  of  the firm  as  well  as the passing  of  consideration  had  been proved.  He had further found that the contesting defendants were  joint with their uncle Manilal in 1949 and  that  they were the partners of the firm Surajmal Manilal-being members of  a trading family, and therefore they were liable to  the extent of the assets of the joint family in their hands.  It appears that the assessment orders were produced not by  the contesting defendants but by the son of Manilal who was  the assessee.  After examining s. 54 of the Income tax Act  1922 and  the  various decisions of the High Courts  the  learned judges  of the High Court ,game to the conclusion  that  the general consensus was that if a copy of the assessment order or  a  certified copy thereof was produced by  the  assessee waiving his privilege it would be admissible in evidence. Section 54(1) of the Act was in the following terms               S.    54(1) "All particulars contained in  any               statement  made, return furnished or  accounts               or documents produced under the provisions  of               this  Act,  or  in  any  evidence  given,   or               affidavit or deposition made, in the course of               any  proceedings  under this  Act  other  than               proceedings  under  this Chapter,  or  in  any               record  of any assessment proceeding,  or  any               proceeding  relating  to  the  recovery  of  a               demand, prepared for the purposes of this Act,               shall   be   treated  as   confidential,   and               notwithstanding  anything  contained  in   the               Indian  Evidence  Act, 1872 (1  of  1872),  no               Court shall, save as provided in this Act,  be               entitled  to  require any  public  servant  to               produce  before it any such return,  accounts,               documents  of record or any part of  any  such               record,  or  to  give evidence  before  it  in               respect thereof." Under  sub-section  (2) if a public  servant  disclosed  any particulars contained in a statement, return etc.  mentioned in sub-s. (1) he was liable to punishment with  imprisonment as well as fine.  The prohibition against disclosure was not applicable  to the facts and particulars in such  cases  and circumstances as were set out in sub-s. (3). Now  it is quite clear that s. 54 created a complete bar  to the production by officials and other servants of the Income tax Department of any such documents which were mentioned in sub-ss. (1) and (2).  It also made it obligatory on them  to treat as confidential the records and documents mentioned in the 312 sub-sections.  They were further prohibited from giving  any evidence. relating to them.  The question which came up  for consideration  before the courts was if the documents  could be given without requiring a public servant to produce  them could the court allow them to be tendered and admitted  into evidence ? The Madras High Court held in Mythili Ammal v. Janaki  Ammal &  Another(")  that statements made in  income  tax  returns

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could  not be brought up in court against the person  making them or against any one else nor could the income returns be proved  by  secondary  evidence under s. 64  of  the  Indian Evidence  Act.   The Calcutta High Court  in  Promatha  Nath Pramanick   v.  Nirode  Chandra  Ghose  (2)  considered   it startling that when an assessment order was to be treated as confidential  under s. 54 of the Act a joint assessee  could be  permitted  the use of the copy of such an order  to  the detriment  of  his co-assessee  in  contentious  proceedings between  them.   A  Full Bench of  the  Madras  High  Court, however, held in Rama Rao v. Venkataramayya(3) that a return was confidential and could not be disclosed to a third party but  there  could be no objection to the maker of  a  return having  a COPY for his own purposes if he so desired and  he was  not  bound to treat the document as  confidential.   In other  words he could produce that document as  evidence  in court. It  is unnecessary for the purposes of this case to go  into the  larger question of production of the documents  covered by  s. 54(1) by third parties as it was the son  of  Manilal the  assessee who had produced the assessment  orders  which are  in  dispute.   There  is  an  overwhelming  weight   of authority in favour of the view that assessment orders could be  produced  by  the  assessee  or  his  representative-in- interest;  see Emperor v. Osman Chotani(4), Suraj Narain  v. Seth   Jhabhu  Lal  &  Others(5)  and  Buchibai  v.   Nagpur University(6).   In our opinion the law laid down  by  these cases on the admissibility of evidence of assessment  orders produced by an assessee or his representative-in-interest is unexceptionable.   We may refer to a decision of this  Court in  Charu  Chandra  Kundu v. Gurupada  Ghosh  (7)  on  which reliance was placed on behalf of the appellants.  There  the appellant  had applied to the trial court praying  that  the Commissioner  of Income tax be directed to arrange  for  the production  before the court of the record of the  statement made  by the respondent therein.  In that situation  it  was held that the prohibition imposed under s. 54 of the Act was absolute   and  the  operation  of  the  section   was   not obliterated   by  any  waiver  by  the  assessee  in   whose assessment the evidence was tendered, documents produced or      (1) 7 I.T.R. 657.   (2) 7 I.T.R. 570      (3) 8 I.T.R. 450.   (4) (1942)101.T.R.429.      (5) (1945)131.T.R.13.    (6) (1947)151.T.R.150.      (7)  [1962] 2 S.C.R. 833. 313 record  prepared.   It  is apparent that in  that  case  the question  of  production  of  an  assessment  order  by  the assessee himself did not come up for consideration. These  appeals  fail  and are  dismissed  with  costs.   One hearing fee. V.P.S.                        Appeals dismissed. 314