Intelligence Officer Vs Kesar Color Chem Industries (Karnataka High Court)
Karnataka High Court held that forcible recovery during course of search or investigation is contrary to law and hence liable to be refunded back. Thus, writ appeal dismissed as devoid of merit.
Facts- The writ petition was filed interalia challenging the investigation carried out under Section 67 of the Central Goods and Services Tax Act, 2017; the validity of the summons to the witness dated 31.07.2021; declaration that the recoveries to the tune of Rs.2,50,00,000/- from the respondent on 31.07.2021 and on 03.08.2021 as being illegal.
Notably, the learned Single Judge has allowed the writ petition on a finding that the deposit of the amount of 1,00,00,000/- on 31.07.2021 and Rs.1,50,00,000/- on 03.08.2021 cannot be treated as a self-ascertainment as the element of voluntariness is absent. According to the learned Single Judge, the sine qua non of self-ascertainment is not fulfilled and as such, the payment is under coercion, the same is liable to be refunded back to the respondent. The issue is whether such a conclusion of the learned Single Judge is justified?
Conclusion- Held that the Court need to look into the facts in totality to come to a conclusion whether there was threat and coercion resulting in the statements recorded and also the deposits made. On a cumulative reading of the facts of this case, we are of the view that the learned Single Judge is right in coming to a conclusion in paragraphs No.24 and 28 of the impugned order which we have reproduced above that the payments were recovery and were contrary to law.
