I-T Raid At Advocate's Office | Privacy of Every Individual Must Be Protected At Any Cost: Gujarat High Court

The above observation came in a plea moved by 45-year-old Maulik Sheth, a practicing lawyer at the high court, challenging income tax raids on a lawyer which was being dealt with by a division bench of Justices Bhargav Karia and Niral Mehta.

During the court hearing, senior advocate Mukul Rohatgi, representing Sheth, contended that the officers had blatantly violated the fundamental rights of his clients. He argued that their right to carry out their profession and move freely had been infringed upon.

Rohatgi emphasized that Sheth and his family were prevented from engaging in professional and other activities for four days, amounting to what he termed as "detention." He asserted that such detention was not authorized by the law and contravened the right to profession under Article 19(1)(g) and violated Article 21 on two grounds – deprivation of liberty and invasion of dignity and privacy. Additionally, he argued that the impounding of devices and phones from November 3 to November 7 violated Article 19(1)(a).

The senior counsel highlighted that the raids, which took place from 6:30 am on November 3 to the morning of November 7, restricted the movement of Sheth's family to the extent of a virtual house arrest. He raised concerns about Sheth's daughter being denied access to her college, questioning the authority under which such requests were expected.

Rohatgi further pointed out that the officers seized hundreds of documents unrelated to the specific client in question, including agreements and legal documents drafted by Sheth for numerous other clients. He argued that the officers went beyond reasonable bounds in their search for a Memorandum of Understanding (MOU) related to a client's property sale.

"For this document, they even raided one of my associate's house early morning. They seized her device and even that of her family members' and later took her to my office and asked her to help search the documents. Isn't this violating rights of people? Isn't this preventive detention," Rohatgi added.

In defense of the Income Tax department, Additional Solicitor General N Venkataraman argued that section 126 of the Evidence Act, which pertains to attorney-client privilege, does not apply in this specific case. He contended that the petitioner, Sheth, is allegedly a collusive agent and a party to the crime, thereby forfeiting his status as a counsel is not protected by attorney-client privilege.

Venkataraman explained that the department initially focused on three groups but uncovered a broader pattern of tax evasion extending beyond these groups. While the investigation is in its early stages, he asserted that "incriminating evidence" has been found against the petitioner, the three targeted groups, and similar transactions handled by Sheth in other cases.

Addressing concerns about targeting a specific profession, Venkataraman emphasized that the investigation does not aim to implicate a professional or the professional community as a whole. He urged the court to distinguish between the petitioner's professional capacity and his alleged involvement in activities unrelated to his profession.

Denying any intention to target a particular profession, Venkataraman argued against the presumptions that the investigation is directed at the legal community. He asserted that the petitioner, despite being a lawyer, cannot shield himself by invoking the protection of the Evidence Act, as he is deemed a collusive agent and a party to the crime.

Venkataraman clarified that the protection under section 126 of the Evidence Act applies only to a client's communication that is not illegal, whereas collusion with the client nullifies such protection. In conclusion, he emphasized that the petitioner loses his capacity as a counsel in this case due to his alleged collusion and involvement in the criminal activities under investigation.

The court raised concerns about the legal justification behind the Income Tax officers from the Ahmedabad Unit conducting a raid on the residence of the petitioner-advocate's associate, who is a female lawyer, during the early morning hours.

The court inquired, "How can you visit a lady advocate's house early morning and seize her and her family members' devices? Isn't this violating her privacy? You will have to clarify as to how and under what law could you raid her house like this."

The court observed that the officers, as stated in their affidavit, had not adequately clarified the rationale behind their "raids" and the decision to confiscate documents from Sheth, which were related to his clients.

The court expressed dissatisfaction, stating, "There is not a single line to deal with the contentions and pleadings made in the petition. Only a merry-go-round explanation. You are only running around the bushes. We want to know, how can you stop people from going out of their house? This is unheard of. Why it took four days of search?"

The Additional Solicitor General (ASG) N Venkatraman, responded by asserting that the raids were meaningful, and they had obtained impeccable information from the petitioner advocate.

Case Title: Maulikkumar Satishbhai Sheth vs Income Tax Officer, Assessment Unit, Ahmedabad

Case No.: R/SCA/20187/2023 (AHMEDABAD)