Santokh Singh Ghai vs M/S S.S.Products Of India And ...

on 3 March, 2009

Punjab-Haryana High Court

Santokh Singh Ghai vs M/S S.S.Products Of India And ... on 3 March, 2009
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
Civil Revision No.1220 of 2008
Date of decision:03.03.2009
Santokh Singh Ghai

...Petitioner
versus

M/s S.S.Products of India and others

...Respondents

CORAM: HON'BLE MR. JUSTICE K.KANNAN

Present:

Mr. Piyush Kant Jain, Advocate for the petitioner.

Mr.Sanjeev Manrai, Advocate for the respondents.
----

1. Whether reporters of local papers may be allowed to see the judgment ? Yes.
2. To be referred to the reporters or not ? Yes.
3. Whether the judgment should be reported in the digest ? Yes. K.Kannan, J.(Oral)
1. The application filed by plaintiff during the course of trial for summoning certain records for the
purpose of cross-examination of a witness DW-2 was rejected by the trial Court and the plaintiff is
revision petitioner before this Court.
2. The suit had been filed for seeking for a decree for Rendition of Accounts and for recovery of
amount due and recoverable from the defendants as commission for the sales effected from the
period 1992-93 till date of suit. The plaintiff himself did not ascertain the sum and therefore had
valued at Rs.10 lakhs with the undertaking to pay additional Court fee when the Court ascertained
the exact amount recoverable from the defendants.
3. The documents which were sought to be summoned were with reference to the three offices
namely from the Sales Tax Department, Central Excise and the Income Tax Department from the
years 1992-93. The exact details of the documents which had been summoned were also referred to
in petition. The Court below while rejecting the petition had referred to Section 26 of the Punjab
General Sales Tax Act which treated as confidential, "the returns or account of documents produced
in accordance with the Act and notwithstanding anything contained in the Evidence Act, no Court
shall be entitled to require any officer of the State Government to produce before it any such
statement return, statement ....."

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Santokh Singh Ghai vs M/S S.S.Products Of India And ... on 3 March, 2009

4. The contention of the learned counsel for the petitioner is (1) the basis for his plea regarding
relevance of documents (2) and the nature and privilege claimed by the defendants. As regards the
first contention, the learned counsel points out to the evidence of the witness DW-2 where, during
the course of cross-examination, the witness had admitted that the original accounts alone had been
destroyed and the copies alone had been subsequently produced. The counsel therefore contended
that the suit being one for accounts and for commission charges for sales routed directly or
indirectly through the defendant, the relevance of the details that could be contained in the
documents with the Taxation Authorities could not be underestimated. The second contention was
that the documents sought for production related to documents with sales tax, excise and income
tax authorities. The trial Court had rejected the petition by reference to a provision of the Sales Tax
Act referred to above and assumed that as they had analogous immunity against all other Acts as
regards income tax records and excise documents. According to him, even otherwise the plaintiff
further suggests that as an agent, referring to a decision of the High Court in 'Sohan Lal v. Nasib
Chand and others, reported in 1978 STC 381', contended that privilege applies only to documents
produced in the course of proceedings under the Act and not to seized documents. In the above
decision, a plea by a partner for production of seized documents from other partners was not
prohibited. This decision is cited to draw a parallel to a situation, where the plaintiff who has the
status as an agent is entitled to some production. In my view, the said decision will have no
application where a partner ei al once a principal as well as an agent vis a vis the other partner.
5. Learned counsel appearing for the respondent points out to the averments made in the plaint and
contends that there are no specific details of how the claims are tenable and how the attempt of the
plaintiff was merely to harass and delay the proceedings. He refers to the decision of the Hon'ble
Supreme Court in 'Tulsiram Sanganaria and another v. Shrimati Annibai (dead) by her legal
representatives and others'- reported in AIR 1971 Supreme Court 671, that had been rendered with
reference to Section 54 of the Income Tax Act. The decision spells out that an assessment order
which is a confidential document could be admissible in evidence if produced by the assessee or the
representative in interest could not be relevant or directed to be produced at the instance of any
other person.
6. I have considered the relevant contention of both the parties and I am of the view that even
without joining issues on the merits of the claim made by the plaintiff, the summoning of the
documents themselves could not have been summarily rejected the plea except in relation to
documents for which under the relevant provisions of the Act, there had been privilege against the
production of returns. The petition for summoning for some documents details three categories of
documents. As regards the first category namely the records of Sales Tax Returns from the year
1992-93, the returns are squarely covered by the confidentiality preserved through Section 26 of the
Punjab Sales Tax Act. The first category also spells out copies of bills of the Firm which have been
submitted to the Sales Tax Department along with ICC data of the said Firm. No such immunity is
available for such nature of documents and therefore the summing of the other type of documents
could not be objected. As regards the second category namely the Central Excise along with Sales
Tax Returns from the year 1992-93, I have gone through the relevant provisions of the Central
Excise Act, 1944 and there are no similar provisions like the one that obtains under Sales Tax Act or
the Income Tax Act. Such of those details of sales which have been made by the Firm and the copies
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Santokh Singh Ghai vs M/S S.S.Products Of India And ... on 3 March, 2009

of the Bills that have been submitted by the Firm to the Central Excise which are available and for
which there are no specific immunity provided under an Act, shall be directed to be summoned. As
regards the third category, all records from Income Tax Department, the returns are privileged
under Section 54 of the Income Tax Act and hence cannot be summoned. The balance- sheet returns
of profit and loss account and trading account which are sought for, though not specifically spelt out
under Section 54 have also to be taken as bar by reference to the fact that the section that also bars
the particulars contained in any statement made. A statement made to the Income Tax Department
along with the returns cannot be any statement other than a statement of balance-sheet or Profit
and Loss Account and therefore, the document sought under the category 3 in the petition are also
covered by the statutory immunity provided under Section 54 of the Act.
7. Under the circumstances, the order of the Court below dated 10.05.2007 is modified and the
plaintiff shall be entitled to summon the documents referred to in the petition in para 3(1), viz the
ICC data of the Firm available for the concerned Excise and Taxation Department, Ludhiana-II and
the details of sales made by the Firm from the year 1992-93 upto the date of suit and copies of bills
submitted to the Central Excise, Range-I, Division No.5, Ludhiana, specified in paragraph 3(ii) of
the petition. The Court below shall issue the necessary subpoena for production of the documents in
accordance with law.
8. The Civil Revision is disposed of in the above terms.
(K.KANNAN) JUDGE 03.03.2009 sanjeev

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