Is Income Tax Return a Confidential document?

Is Income Tax Return a Confidential document?

The Madras High Court Judgment in 1957

AIR 1957 Mad 401

Nagammai Achi v. Alamedlu Achi

In a civil suit, the defendant filed an application against the plaintiff, under Or 11 R 14 of CPC to produce the income tax returns and assessment orders of the plaintiff.

The plaintiff refused to produce on the ground that they are ‘confidential’ documents within the meaning of Sec.54 of the Income tax Act.

The question arises was: indeed, it was not disputed that the documents in controversy would fall within the section of the IT Act. But whether it should be treated as confidential only so far as the Income tax department is concerned; and whether they are not confidential as regards to the assessee, and whether the plaintiff can be compelled to put them into Court.

The Bombay High Court in Emperor v. Osman Chotani, AIR 1924 Bom 289: in this case, where an investigating police officer served summons on the Income Tax Commissioner requiring him to produce certain documents lodged by the accused in connection with his income tax. The IT Commissioner declined on the ground that he was precluded from doing so under Sec.54 of IT Act. Thereupon the police officers made a search of the office of the Income Tax Commissioner and seized certain documents filed by the accused. The Chief Presidency Magistrate held that they were not admissible in evidence in view of Sec.54 of IT Act. But Bombay High Court held that such extreme view was erroneous.  Beaumont C.J. who delivered the judgment of the Bench observed that the legislature meant that they are to be treated by the IT authorities as confidential and not in other respects.

The only effect of Sec.54 is to prohibit a Court from directing any public servant to produce before it; that is to say, the section is no bar to an assessee being directed to produce such documents into Court.

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