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What's the article about?
- It talks about the implications of the Puttaswamy verdict on the interpretation of Section 132 of the Income Tax Act in India. It highlights the conflict between the fundamental right to privacy and the extensive powers of search and seizure granted to the tax authorities under the Act.
Relevance:
- GS2: Government Policies and Interventions for Development in various sectors and Issues arising out of their Design and Implementation
Context:
- The landmark 2017 Puttaswamy judgment by the Supreme Court of India established a fundamental right to privacy for individuals.
- Despite this, the court's interpretation of statutes like the Income Tax Act often remains unchanged, leading to a culture of judicial deference to executive authority.
- This article examines the dissonance between the promise of Puttaswamy and the reality of unchecked executive power in the context of income-tax searches.
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Puttaswamy Judgment
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Analysis:
- Power of Search and Seizure:
- Section 132 of the Income Tax Act empowers the revenue authorities with extensive search and seizure powers, raising concerns about individual privacy and due process.
- Notably, unlike searches under the Code of Criminal Procedure, income-tax searches do not require prior judicial authorization.
- Shadow of M.P. Sharma:
- India's income-tax law initially lacked search and seizure powers. The Taxation on Income (Investigation Commission) Act (1947) was struck down for violating equal treatment.
- Section 132 was introduced in 1961 and upheld by the Supreme Court in Pooran Mal v. Director of Inspection (1973).
- The 1973 Pooran Mal judgment relied heavily on M.P. Sharma, which upheld the constitutionality of Section 132.
- However, M.P. Sharma was decided before the Puttaswamy judgment and its interpretation of fundamental rights.
- Today, the right to privacy under Puttaswamy is intertwined with the right to personal liberty under Article 21, making the state's power to search and seize subject to the principle of proportionality.
- Doctrine of Proportionality: For a search to be lawful under the doctrine of proportionality, it must:
- Have a legitimate aim: The purpose of the search must be valid and important.
- Be rationally connected: The chosen method of search must be logically linked to achieving the aim.
- Be the least intrusive option: No less intrusive means should be available for achieving the same goal.
- Balance the means and the right: The harm to the individual's right to privacy must be proportionate to the importance of achieving the search's aim.
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Wednesbury Principle
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- Wednesbury Principle and its Inadequacy:
- The 2022 Mandalia judgment surprisingly disregarded the Puttaswamy judgment and applied the Wednesbury principle, which demands a very low threshold for judicial review.
- This minimal standard is insufficient to protect individual rights in the face of potentially intrusive income-tax searches.
Way Forward:
- Reconciling executive power with individual privacy rights in the shadow of Puttaswamy necessitates a paradigm shift in the judicial approach to income tax searches. The current framework, characterized by deference and inadequate scrutiny, poses a significant threat to fundamental liberties.
- Moving forward, a robust adherence to statutory requirements and a rigorous application of the proportionality principle are paramount. Only by demanding robust justification and meticulous judicial review can we prevent the unwarranted exercise of extra-constitutional power and safeguard the privacy rights of Indian citizens.
