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Narbadashankar Manoharlal Jaiswal Vs. Jamnabai Manoharlal and anr. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtMadhya Pradesh High Court
Decided On
Case NumberCivil Revn. No. 246 of 1960
Judge
Reported inAIR1961MP21; [1963]47ITR44(MP)
ActsIncome Tax Act, 1922 - Sections 54(1); Evidence Act, 1872 - Sections 76
AppellantNarbadashankar Manoharlal Jaiswal
RespondentJamnabai Manoharlal and anr.
Appellant AdvocateU.M. Trivedi, Adv.
Respondent AdvocateK.A. Chitale, Adv.
DispositionApplication dismissed
Cases ReferredIn Emperor v. Osman Chotani
Excerpt:
- - normally, a question like this would have been left to be considered during the appeal, if any, filed by the aggrieved party in time. for precisely the same reasons, the disclosure by the department of the contents of an assessee's statement or documents to his heirs or legal representatives or the fellow members of the same joint family, would not be a contravention. it is difficult to agree with this view as there is nothing in section 54(1) expressly supporting it and this carries the assessee's privilege well beyond the ostensible purpose of that section. but one need not go so far to maintain that a copy obtained by a person other than the assesses can, if the requirements of the evidence act are satisfied, be admitted into evidence......(3) sets out a number of exceptions with which, however, we are not presently concerned. from the assessee's viewpoint, this direction becomes a privilege which he can certainly assert against third parties. but, obviously, it cannot, in any way be asserted against the assessee himself, for example, if there are two persons, both of whom derive from the same assessee, or one of whom being the assessee, the other is in the income-tax proceeding represented by him, neither can claim privilege against the other.that is why in venkataramana v. varahalu, air 1940 mad 308 it was held that the disclosure by the income-tax officer of the contents of the documents filed by one partner to another partner was not considered a contravention of section 54(1). that judgment speaks of certain.....
Judgment:
ORDER

H.R. Krishnan, J.

1. This is an application by the defendant in a suit pending before the Civil Judge Ujjain, praying that his order admitting into evidence certified copies of four documents (two by the defendant and two others by his father) filed before the Income Tax Officer should be set aside as contravening Section 54(1) Income-tax Act and Section 76 of the Evidence Act. Normally, a question like this would have been left to be considered during the appeal, if any, filed by the aggrieved party in time. But in the present case, however, the parties feel that this evidence alone might de-cide the suit, the defendant fearing of course, that once this is admitted, the suit may be decreed against him.

The trial Court has followed the view taken by the Nagpur High Court in Buchibai v. Nagpur University, AIR 1946 Nag 377 which is to some extent in conflict with the one taken by the Calcutta High Court in Promatha Nath v. Nirode Chandra, AIR 1940 Cal 187 and recently followed by Patna High Court in Banarsi Devi v. Janki Devi, AIR 1959 Pat 172. The additional prayer on the part of the applicant is that a reference may be made to a Divisional Bench for the reconsideration of the Nagpur view in the light of these, and similar decisions of the other High Courts.

2. The relevant facts are that there was one Manoharlal Jaiswal doing business and owning properties at Ujjain. He died leaving a widow Jamna-bai, a daughter-in-law Kamalbai (widow of a predeceased son) both of whom ara the plaintiffs and a second son, Narbadashankar who is the defendant in the present suit for partition. The plaintiffs aver that the business and the properties of Manoharlal were themselves ancestral, and Narbadashankar is managing them as karta of the joint family of which they are members.

The defence is that the property and the business of Manoharlal were really self-acquired and he, for his part, has already executed a will giving the business and certain properties to Narbadashankar, allotting certain others proportionately sub-share-value, to these plaintiffs. Leading evidence, the plaintiffs produced ccrtiiied copies of certain declarations and statements two by Manoharlal in his lifetime, and two by Narbadashankar himself, in course of income-tax proceedings. It is common ground of the parties that these indicate that Manoharlal in his time, and Nabardashankar later on, described the business as joint family business.

Admitted as evidence, these would, pro tanto, shake the case of the defendant. Questioning their admissibility into evidence, the defendant urged, firstly, that these declarations should not have been divulged by the Income-tax Authorities by grant of certified copies to the plaintiffs who are not the assessees; secondly, even if the plaintiffs had succeeded by this irregularity in obtaining these certified copies, they should not be admitted under Section 76 of the Evidence Act, the plaintiffs not being persons 'who have a right to inspect the original documents'. While admitting that the Nagpur decision does justify their admission into evidence, it is urged on behalf of the applicant that the Calcutta-Patna view being preferable and more in consonance with the purpose of Section 54 of the Income-tax Act and as such, it calls for reconsideration.

3. We are actually dealing with two distinct problems; first whether Section 54(i) of the Income-tax Act permits the public servant in whose custody the documents are kept to divulge their contents to a legal representative of the assessce (using the word in the broadest sense), who may be either his heir, or one on whose behalf he has been acting, such as a member of the same partnership or of the same joint family. Another way of stating the same is, whether an assessee can set up the privilege given under Section 54(1) against such representatives. The second question is, whether, a person having obtained the certified copy of a document even though he has no right to inspect, can be prevented from tendering it as evidence, if it is otherwise admissible. To succeed in shutting out this evidence, the defendant has to get both questions answered in his favour.

4. In terms, Section 54(1) of the Income-tax Act is a direction to the public servants in charge of records of the income-tax cases to treat as confidential all particulars contained in statements or documents filed by an assessee. Any breach will render him liable to prosecution under Sub-section (2). Subsection (3) sets out a number of exceptions with which, however, we are not presently concerned. From the assessee's viewpoint, this direction becomes a privilege which he can certainly assert against third parties. But, obviously, it cannot, in any way be asserted against the assessee himself, for example, if there are two persons, both of whom derive from the same assessee, or one of whom being the assessee, the other is in the income-tax proceeding represented by him, neither can claim privilege against the other.

That is why in Venkataramana v. Varahalu, AIR 1940 Mad 308 it was held that the disclosure by the Income-tax Officer of the contents of the documents filed by one partner to another partner was not considered a contravention of Section 54(1). That judgment speaks of certain representatives mentioned in the manual of instructions, but that is only illustrative and in any case, an executive instruction cannot restrict the intendment of statute. For precisely the same reasons, the disclosure by the department of the contents of an assessee's statement or documents to his heirs or legal representatives Or the fellow members of the same joint family, would not be a contravention. The principle contained in AIR 1940 Mad 308 (supra) has been followed in the Full Bench decision in Venkata Gopala Narasimha Rama Rao v. Venkataramayya, AIR 1940 Mad 768 and! also in AIR 1946 Nag 377 (supra) where the applicant was, as in the present case in regard to the statements filed by Manoharlal, the widow of the assessee.

5. A different view has no doubt been taken in the Calcutta judgment, there it was held that a partner or a person claiming to be a partner in a firm was not entitled to get disclosure of the contents of a statement filed by the other partner. It is difficult to agree with this view as there is nothing in Section 54(1) expressly supporting it and this carries the assessee's privilege well beyond the ostensible purpose of that section. Though the Patna judgment (AIR 1959 Pat 172) apparently follows the Calcutta view, the position is not quite similar.

Here, the applicant for disclosure was not exactly a legal representative or a member of the firm, but the widow of a deceased partner. Even if that judgment is interpreted as it apparently docs, reaffirming the Calcutta view, for the same reasons already noted, it is difficult to agree. Thus, on the first question, I would hold that the privilege given by implication to the assessee by Section 54(1) of the Income-tax Act cannot avail against a person who is a legal representative or heir of the assessee or on whose behalf the assessee has been acting. This alone would justify the admission of the certified copies of these documents into evidence,

6. The second question is one principally regarding the admissibility of the certified copy of a public document under Sections 74, 76 and 77 of the Evidence Act. If a person not really entitled to disclosure, in other words, entitled to inspect the document, has still managed to get a certified copy, the question posed is, can he be allowed to file the copy into evidence? Considering this independently of the first question, and assuming for the moment that the heir and the representee is not entitled to inspect the documents, still would this shut out from evidence the certified copies actually obtained by diem? There is nothing in Section 76 to exclude this and the only possible justification for this would be one of public policy.

The answer given by the High Courts, other than Calcutta and recently, Patna, is that in such) matters, the Court should not import questions of policy but should decide admissibility on the face of the document in accordance with the Evidence Act. In AIR 1940 Mad 768 (FB) (supra), it was expressly held that the ground of public policy is not a sufficient reason for excluding from; evidence any document which is legally admissible under the Evidence Act and is not excluded by statutory prohibition.

The Bombay High Court in fact goes a step further.

In Emperor v. Osman Chotani, AIR 1942 Bom 239, it was held that Section 54(1) only obliges the Income-tax authorities to treat the documents as confidential. If a police officer has come by these documents in a lawful manner, he will be competent to disclose them in evidence though the Income-tax Officers themselves may not be competent. But one need not go so far to maintain that a copy obtained by a person other than the assesses can, if the requirements of the Evidence Act are satisfied, be admitted into evidence. As for the question of public policy which seems to be the basis of the Calcutta decision, it is already secured by the penal provision contained in Section 51(2).

Whether the public servant in Sub-Section (1) means only the servant of the income-tax department or includes all public servants, the person who commits a breach of the direction contained in the sub-section is held liable to punishment under SubSection (2). That fact cannot enter into a consideration of the admissibility of the certified copy under the Evidence Act. Thus, even apart from the first question, on the second question also, the defendant's contention cannot be accepted. Here again, the Nagpur view contained in the ruling already referred to seems to be in accordance with the principles of the Evidence Act. Nor is there a case for a reconsideration of that view, which, is reasonable and in accordance with the wording of the section by a larger bench.

7. The result is that the application of the defendant applicant is dismissed. Costs and pleaders feeaccording to rules payable by him to non-applicants.


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