While dismissing the petition filed by an accused person alleged to be a beneficiary of foreign assets maintained and controlled through foreign business entities, the Punjab and Haryana High Court has held that there is no restriction on the Directorate of Enforcement to access the information/documents placed on record before the Magistrate by the I.T. Department for investigation.

The High Court was considering the Petition filed under section 482 of the CrPC seeking the setting aside of the dismissal of the revision petition filed by the petitioner. The petitioner also sought the setting aside of the Magistrate’s order allowing the application filed by the second respondent/Directorate of Enforcement (E.D.) to inspect the documents attached to the complaint filed by the first respondent/Income Tax Department (I.T. Department).

The Single Bench of Justice Tribhuvan Dahiya held, “ In the instant case, as discussed hereinbefore, there is no restriction on the E.D. to access the information/documents placed on record before the Magistrate by the I.T. Department for the purpose of investigation. Therefore, it cannot be said that the E.D. is trying to procure the documents by circumventing the Agreement in question.”

Advocate Gurmohan Singh Bedi represented the Petitioner while Special Counsel Zoheb Hossain represented the Respondent.

Factual Background

The I.T. Department had filed a complaint before the Chief Judicial Magistrate, Ludhiana, against the petitioner under Section 277 of the Income Tax Act, 1961, read with Sections 176, 177, 181, 186, 187, 193 and 199 of the Indian Penal Code (IPC) alleging that the accused was the beneficiary of foreign assets maintained and controlled through foreign business entities. The accused was allegedly the beneficiary of foreign bank accounts maintained with HSBC Private Bank (SUISSE) S.A Geneva, Switzerland. Based upon these documents, summons u/s 131(1A) of the Act was issued to Amarinder Singh to know about his association/relation with the Jacaranda Trust and properties situated in Dubai.

Information was received by the Director General of Income Tax (Inv.), Chandigarh, indicating an association/connection of the family members of the accused with certain foreign entities. A summoning order was passed against the petitioner. During the pendency of the complaint, the E.D. moved an application before the Magistrate for inspection of documents filed by the complainant/I.T. Department, or, in the alternative, seeking directions to the complainant to provide a copy of those documents. The application was allowed by the Magistrate, permitting inspection of the judicial file by the E.D. The Petitioner’s revision was dismissed, and the Magistrate’s order was upheld. It was in such circumstances that the petition came to be filed before the High Court.

Reasoning

The Bench noted that the information regarding the foreign assets concerning the petitioners was placed on record in the form of documents before the Magistrate by the I.T. Department, which was sought by another government Department/E.D. for the purpose of investigation. It was further noticed that the present was not a case where the information had been demanded for public dissemination; rather, it was only for carrying out an investigation against the petitioners. -

The Bench also referred to the judgment in Ram Jethmalani and others v. Union of India and others (2011), where the Apex Court examined the Avoidance of Double Taxation Agreement entered into between the Government of India and Germany and it was held that if any citizen or entity has information of any wrongdoing associated with the Bank account of an individual, it is their moral duty to inform the State about it which would have the obligation to investigate the same.

“It is the Government of India which has entered into this Agreement with the French Republic, whereunder the information has been handed over to the I.T. Department. In case disclosure of information causes any violation of terms of the Agreement, including that of Article 28, it is for the Department to oppose it on that ground and not for the petitioners. And the former has no objection to sharing the information for investigation, nor can such an objection be raised on its behalf in the light of law laid down in Ram Jethmalani case ibid. holding, if a citizen or entity has any information of wrongdoing with respect to a Bank account, it must be shared with the State which is under obligation to investigate the same. Here, the information is being sought by an organ of the State/the E.D. itself for the purpose of investigation which cannot be taken exception to in view of the settled law”, it observed.

Thus, dismissing the Petition, the Bench permitted the E.D. to inspect the record of the complaints before the Magistrate and access the information/documents. “...however, the same shall not be disseminated publicly unless permitted in accordance with law”, it concluded.

Cause Title: Amarinder Singh v. Income Tax Department (Neutral Citation: 2025:PHHC:118832)

Appearance

Appellant: Advocates Gurmohan Singh Bedi, Amandeep S. Talwar, Pawandeep Singh, Anand V. Khanna, Ambika Bedi

Respondent: Special Counsel Zoheb Hossain, Senior Panel Counsel Lokesh Narang, Advocate Vipul Joshi

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Punjab & Haryana High CourtJustice Tribhuvan Dahiya

Tulip Kanth

Assistant Editor

Tulip Kanth is an Assistant Editor at Verdictum having over 5 years of experience in the field of legal journalism and editing. She extensively covers judgments of the Supreme Court, High Courts as well as Tribunals. She has previously worked with a legal publishing website where she oversaw the work of other editors and has also created updates on notifications of different Government Ministries. She holds an English Honours Degree from SGTB Khalsa College, Delhi University and has completed her LLB course with specialisation in Corporate Law from Amity University.