IJAZ ANWAR, J.---Through this single judgment, we intend to dispose of this and the connected Writ Petitions Nos. 759-P and 761-P of 2017 involving common question of law and fact. The common relief that has been sought in this and the connected writ petitions are that:-- "I) The impugned act of the Respondent No.4 for conducting forcible raid on the premises of the petitioner and taking into custody Computer, records and other valuable documents etc without any notice and without any receipt in the garb of section 175 of the Income Tax Ordinance is illegal, unconstitutional, wrong, unauthorized, based on high handedness and thus liable to be declared as such.
II) That the Respondent No. 4 are bound to at once return all the Paraphernalia so illegally taken into custody from the premises of the petitioner so that the petitioner may run his business without any undue fear and the Respondent be refrained from taking any action against the petitioner in similar fashion in perpetuity.
III) That the Respondents are not authorized to proceed against the petitioner in any manner on the basis of impugned acts as the elements of fabrication and manipulation on the behest of the rivals of the petitioner is very much present and existing any such act of the Respondent is without lawful authority, ultra vires of the Constitution and thus of no legal effect. IV) The respondents may perpetually be restrained from proceedings adversely against the petitioners till the writ petition so filed by the petitioner is decided by an independent Court of competent jurisdiction and stay may kindly be granted".
2. The facts narrated in this case are that the petitioner is a private limited, company duly incorporated under the Companies Ordinance,,- 1984 and engaged in the business of outdoor furniture and sanitary Pipes and fittings. The petitioner has been duly authorized by the Board of Director to file this petition. It is alleged that despite all the non-conducive atmosphere in this part of the country for the Industrialists, the petitioner and its sister concerns are contributing sizably towards the economy of this Province. It is alleged that the petitioner remained very clear and open towards its liability towards tax authorities and submitted Income Tax Returns in times and no return was however objected by the Income Tax Department. It is alleged that one Hafeez-ur- Rehman an Ex-employee having personal grudge with the petitioner, conveyed wrong information to the respondents which resulted into the illegal and highly agonizing raid by the respondents on 17.2.2017 at the headquarters office of the petitioner and its sister concerns without notice or any prior information. It is alleged that without their being any legal warrant from the Court of law, the respondents forcibly entered into the premises of Head Office and forcibly snatched and took into possession the valuable documents, records and computers of the petitioner. It is alleged that while seizing these documents and computers no receipt was ever provided. The petitioner when approached the respondent No.4 and complained about the illegal activities, was handed over the fabricated notice of inquiry dated 17.2.2017 allegedly issued under section 175 of the Income Tax Ordinance, 2001 and refused to return the documents and computers impounded illegally.
3. The respondents were put to notice and directed to file their comments. The respondents Nos.4 and 5 have accordingly filed their comments, wherein they denied the allegations leveled by the petitioner. They summarized their defence in paras 6 and 7 of the comments, besides objecting on the jurisdiction of this Court.
4. Paras. 6 and 7 of the comments are reproduced for ready reference:-- "That the contents of the corresponding para are pathetically untrue, incorrect and whimsical. The purpose of such narration on the part of the petitioner is just to sensitize to matter.
The answering respondent conducted search of the business/ manufacturing premises of petitioner in accordance with the provisions of section 175 of Income Tax Ordinance, 2001 read with SRO 115(1)/2015 dated 09.02.2015. The visiting team went totally unarmed and entered the premises of petitioner with permission and in a peaceful manner. The petitioner themselves not only provided free access to their business/manufacturing premises but also handed over the requisite record to the answering respondents visiting team. During the course of search, the authorized officers examined certain record/ documents and computers which were taken into custody for the purpose of detailed examination and further investigation under the law.
Here it is pertinent to mention that the petitioner is not a law abiding citizen, as after taking custody of the record, as the. answering respondent team was about to leave, the petitioner's armed men stopped the answering respondent and put them in illegal confinement. The respondents' officials were not allowed to leave the premises. So much so that eventually when the respondent No. 4 came to know about the illegal confinement of his officials, the same sought the help of the area Police to rescue his officials from the garb of petitioners' armed perssonels.
Later on FIR was also lodged against the petitioner. Copy of the FIR is hereby enclosed".
5. The learned counsel for the respondents at the very outset raised preliminary objection regarding the maintainability of this constitutional petition on the ground that the survey/search of the premises was conducted by the authorized officer while exercising the powers under section 175 of the Income Tax Ordinance, 2001, therefore, under section 122 of the Income Tax Ordinance, the petitioner has his remedy by submission of the case as a taxpayer and in case aggrieved there from to avail remedies provided under that fora.
6. In response, learned counsel for the petitioner formulated his arguments and argued that impounding the computers and other record of the petitioner and by the respondents allegedly exercising their power under section 175 of the Income Tax Ordinance, 2001 that evidence can be used against the petitioner under section 216(3)(g) for the purpose of Sales Tax, Federal Excise Tax and Customs Tax, etc therefore, the search as required under section 40 of the Sales Tai Act, 1990 was mandatory and having not been conducted in accordance with law, has no legal sanctity.
Similarly, the raid of the premises without such search warrant as prescribed under the law would be illegal and where the respondents have not conducted themselves in accordance with law, the writ petition would be competent.
7. Learned counsel for the petitioner argued that section 175 of the Income Tax Ordinance, 2001 is para-materia to section 38 of the Sales Tax Act, 1990, therefore, while conducting such search, the procedure prescribed under section 40 of the Sales Tax Act, 1990 would be applicable, wherein the relevant provisions of Criminal Procedure Code 1898 relating to search was made applicable.
Learned counsel for the petitioner relied upon 2014 SCM R 30 to contend that such type of raids without notice and without the prior permission from the Magistrate was declared as illegal.
Learned counsel also referred to an un-reported judgment of the Apex Court in C.P. No. 1534 of 2016 titled "Additional Director General of Intelligence and Investigation, Customs House, Peshawar v.
Messrs Universal Plastic Industries" dated 31.5.2016, wherein while making reference to sections 38 and 40 of the Sales Tax Act, 1990, the judgment of the Peshawar High Court. striking down the raid as un-authorized was maintained and leave was refused. Learned counsel for the petitioner referred to sections 101,102, 103 read with section 165 of the Criminal Procedure Code, 1898 and contended that any search of the premises without following the procedure prescribed under Cr.P.C. is illegal and was struck down in a number of judgments by the Superior Courts. He placed reliance on 2003 PTD 1034, 2007 PTD 2356, 2005 SCM R 1166, PLD 1991 SC-630, 1999 PCr.LJ 1546, 1997 SCMR-408, PLD 1996 SC-574, 2005 PTD 1200 and 2005 SCM R 37. He while specifically referring to the impugned order dated 17.2.2017 whereby access was sought to the premises and on the strength of that letter they forcibly entered the premises and after examination of some record subsequently impounded the record, documents and computers, the learned counsel for petitioner contended that it was not a final order, therefore, the provision of section 122 of the Income Tax Ordinance, 2001 cannot be invoked. Similarly, the judgments which he referred and placed reliance also arisen out of constitutional petition decided by the High Courts and maintained by the Supreme Court of Pakistan. He contended that this Court can entertain the writ petition in the given circumstances.
8. The learned counsel for the respondents, however, while arguing the case on merits submitted that the Resumption memo duly prepared under section 175(1)(e) suggests that it was produced to the visiting team by the taxpayers themselves and no force as alleged was used or it can be termed as a raid. Learned counsel argued that it was purely a factual controversy and therefore, the same cannot be resolved in writ jurisdiction, besides availability of alternate remedy for him.
9. Learned counsel for the respondents referred to the notification dated 09.02.2015 and contended that certain officers were duly authorized under the law to enter for search as mentioned under section 175 of the Income Tax Ordinance, 2001. He further argued that the petitioner are bound to allow free access to the Authorized Officer for the purpose of survey or making of Audit of the Taxpayers, therefore, there is no occasion for the petitioner to have invoked the constitutional jurisdiction of this Court and request for the dismissal of the writ petition.
10. Arguments heard and record perused.
11. The record shows that the petitioner was issued a notice of enquiry under section 175 of the Income Tax Ordinance, 2001, scheduled for 17/2/2017. A team was constituted to verify the facts which they received after certain credible information/enquiry about undeclared bank account and suppression of sales. This visit pursuant to the notice has been termed by the petitioner as raid, use of force in impounding certain record/documents and computers.
12. The point of law for the determination of this Court as emerged from the arguments of the learned counsel for the parties is that whether the Commissioner or any Officer authorized, when given access to any premises can further impound any accounts, documents or computer desk etc without the permission of the taxpayer and then make inventory of such impounded material, without adopting the procedure prescribed under sections 101, 102, 103 read with section 165 of the Criminal Procedure Code, 1898 and whether section 38 of the Sales Tax Act, 1990 is para-materia to section 175 of the Income Tax Ordinance, 2001 and if so the Authorized Officer is bound to follow the procedure as prescribed under section 40 of the Sales Tax Act, 1990. To find out the answers to these questions, we for the purpose of convenience reproduce section 175 of the Income Tax Act, 2001 as:-- 175.Power to enter and search premises.---(1) In order to enforce any provision of this Ordinance (including for the purpose of making an audit of a taxpayer or a survey of persons liable to tax), the Commissioner or any officer authorized in writing by the Commissioner for the purposes of this section
(a) shall, at all times and without prior notice, have full and free access to any premises, place, accounts, documents or computer;
(b) may stamp, or make an extract or copy of any accounts, documents or computer-stored information to which access is obtained under clause (a); (c) may impound any accounts or documents and retain them for so long as may be necessary for examination or for the purposes of prosecution'
(d) may, where a hard copy or computer disk of information stored on a computer is not made available, impound and retain the computer for as long as is necessary to copy the information required; and
(e) may make an inventory of any articles found in any premises or place to which access is obtained under clause (a)
(2) The Commissioner may authorize any valuer or expert to enter any premises and perform any task assigned to him by the Commissioner]
(3) The occupier of any premises or place to which access is sought under subsection (1) shall provide all reasonable facilities and assistance for the effective exercise of the right of access.
(4) Any accounts, documents or computer impounded and retained under subsection (1) shall be signed for by the Commissioner or an authorized officer.
(5)A person whose accounts, documents or computer have been impounded and retained under subsection (1) may examine them and make extracts or copies from them during regular office hours under such supervision as the Commissioner may determine.
(6) Where any accounts, documents or computer impounded and retained under subsection (1) are lost or destroyed while in the possession of the Commissioner, the Commissioner shall make reasonable compensation to the owner of the accounts, documents or computer for the loss or destruction.
(7) This section shall have effect notwithstanding any rule of law relating to privilege or the public interest in relation to access to premises or places, or the production of accounts, documents or computer stored information.
(8) In this section, "occupier" in relation to any premises or place, means the owner, manager or any other responsible person on the premises or place".</i>
13. We have examined very carefully the arguments of learned counsel for the petitioner, when he argued that in section 175(a), specifically the powers to enter and have free access to any premises has been given only under section 175 (1)(a) but in the subsequent provisions where documents, computers can be impounded no such powers/ authority is conferred "without prior notice" is mentioned purposely by the legislation, therefore the learned counsel tried to deduce this law point that since these are stringent actions, therefore, they cannot be carried out without prior notice and search procedure as prescribed under the Cr.P.C., 1898.
14. We may observe here that the Income Tax Ordinance, 2001 is a legislation later in time to the Sales Tax Act, 1990, therefore, if the intention of the legislation was to have considered the respective sections 38 of the Sale Tax and 175 of the Income Tax Ordinance as para-meteria then there was no need of giving numerous detail in section 175 of the Income Tax Ordinance. We found that section 175 is a self contained section and provided the actions step by step in section 175(1)
(a) and thereafter. All these sub sections cannot be read disjunctively but be read conjunctively, because the actions i.e. taken by the Commissioner or Officers authorized follows one after the other. Section 175(1)(a) allow the Authorized Officer to have full and free access to any premises, place, accounts and documents or computer, subsection (b) then if required allow such officer to make an extract or copy of any accounts, documents, computer stored-information to which excess is obtained under clause (a). Now, if the authorized officer found that on examining the computer and the record/documents it is found that it required further examination or, there is suppression of some important facts about evasion in tax, he may impound any account or documents and retained them for so long as may be necessary for examination or for purpose of prosecution. Section 175 (1) sub-clause (e) further support this discussion, wherein an inventory of any article found in any premises is prepared. In this sub-clause (e) of section 175(1) again the words "to which access is obtained under clause 1 clause (a)" is used which is very important, because it dispels this arguments that inventory of such impounded materials can be made only when a proper procedure of search is carried out as required under the Criminal Procedure Code, 1898.
15. Subsection (7) of Section 175 of the Income Tax Ordinance, 2001 gives this section an overriding effect on any other law/rules relating to privileges or the public interest in relation to access to premises for or places or the production of accounts, documents or computer stored-information.
Thus, it excludes the impression of search warrant or search procedure as required under Criminal Procedure Code, 1898.
16. Similarly, the arguments that the action taken by the respondents under section 175 and the evidence procured can be used against the petitioner under section 216(3) clause (g) even in the matters of Sales Tax etc, therefore, the procedure prescribed under section 40 of the Sales Tax is required to be followed. We put this arguments to the respondents to respond, the representative of the respondents present in Court and their counsel have stated at the bar that the information that is obtained under section 175 of the Income Tax Ordinance shall not be used against the petitioner as prescribed under section 216(3)(g) of the Income Tax Ordinance, 2001. Be that as it may, the matter is still under inquiry as prescribed under section 175 of the Income Tax Ordinance, 2001 and secondly where any such information that is obtained, and is used against the petitioner in the matter of Sales Tax etc that would be seen at its appropriate time.
17. We have also examined the case law referred by the learned counsel for the petitioner and found that the judgments relied upon are distinguishable, because only sections 38 and 40 of the Sales Tax Act, 1990 read with sections 101, 102, 103 and 165 of the Cr.P.C. 1898, were discussed. None of the case referred have discussed the effect of section 175 of the Income Tax Ordinance, 2001.
18. It is also observed that where the search under section 175 of the Income Tax Ordinance, 2001 has not been subjected to the searchprocedure as required under the Criminal Procedure Code, 1898, we cannot of our own import that procedure or the provisions contained in section 40 of the Sales Tax Act, 1990 into section 175 Income Tax Ordinance, 2001 nor we can of our own alleges omission on the part of legislation in not mentioning. Rather we observe that it was with reasons because subsection (7) of section 175 of the Income Tax Ordinance, 20Q.1, was given an overriding effect over any rule or law relating to privileges or the public interest in relation to access to premises or places and searches, examination of record, impounding documents/computers that is carried out under the mandate of above subsections. Similarly, the law mandated the respondents to be given full and free access to the premises without prior notice and involving police for search was never the intention of legislation.
19. For the aforesaid reasons, we are thus clear in our mind that the action taken by the respondents cannot be termed as illegal, the respondents acted within the parameters set by section 175 of the Income Tax Ordinance, 2001 and in no way can be termed as without jurisdiction.
20. This and the connected writ petitions are thus not maintainable and dismissed.