Gujarat High Court Directs To Release Seized Gold As Outstanding Demand Against Assessee

The Gujarat High Court has directed the department to release the 100.350 grams of seized gold as the assessee had no outstanding demand.

The bench of Justice Vipul M. Pancholi and Justice Devan M. Desai has observed that the gold in question belongs to the petitioner, and he has accounted for it in his books of accounts. Therefore, the respondent or department ought not to have withheld the gold in question.

The search and seizure were carried out in respect of Sureshkumar from Jay Mata Di Air Service and Jagdish Prasad from Bright Courier. A parcel containing gold, weighing a total of 720.34 grams, was intercepted and seized by the department.

The respondent added the value of the seized gold of the petitioner, weighing 720.34 grams, to the total income of the petitioner, treating it as an unaccounted investment so as to protect the interest of the revenue.

The Appellate Authority allowed the appeal filed by the petitioner and deleted the addition made by the respondent in respect of the seized gold of the petitioner.

The petitioner contended that there is no demand outstanding against the petitioner for any of the liabilities after effect is given to the order of the Appellate Authority. Therefore, the Respondent ought to have released the remaining seized gold, weighing 100.350 grams, in favor of the petitioner.

The department contended that the addition has been made by the concerned Assessing Officer in the hands of the sender party with respect to the seized gold, weighing 100.350 grams. Consequently, a demand of Rs. 3,09,992 has also been raised against the assessee. The request of the petitioner to release the remaining seized gold has rightly not been entertained, and the Respondents have committed no illegality.

The court held that merely because some demand is pending, it is not open to the respondent authorities to continue to withhold the gold, weighing 100.350 grams, which is in the ownership of the petitioner.

Case Title: Praveenbhai Girdharilal Agarwal Versus Principal Commissioner Of Income Tax (Central)

Case No.: R/Special Civil Application No. 1856 Of 2023

Date: 27/06/2023

Counsel For Petitioner: Fenil H Mehta

Counsel For Respondent: Varun K.Patel

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