Chandurkar, J.
1. In Insolvency proceedings against the two respondents who are husband and wife, the appellant-claimant has been shown by the respondent as a credit in respect of a sum of Rs. 10,000 only, while the appellant-claimant has filed before the official assignee of the High Court a claim for Rs. 1 lakhs which is said to be due from the insolvents. Accounting to the respondents, the claimant had disclosed the amount due from them as being Rs. 10,000 only in a statement file by him with the I.T. authorities on November 19, 1971. By an ex parte order dated September 29, 1978, the Insolvency Registrar was ordered at the instance of the respondents to issue letters of request to, (i) the commissioner of Income-tax, Bombay City-V, (ii) the Commissioner of Income-tax (Central), Bombay, and (iii) the 7th Income-tax Officer, A-Ward, Piramal Chambers, Parel, Bombay, to cause to produce an application for settlement under s. 271(4A) of the I.T. Act, 1961, filed by the claimant with the commissioner of Income-tax (Central), Bombay. These documents were to be produced before the official assignee at the time of examination of the claimant. A notice of motion taken out by the appellant to have been ex parte order set aside having been dismissed, the appellant has now filed this appellate to have the order, requiring the Insolvency Registrar to issue the necessary letters, set aside.
2. Mr. Keshavdas Dalpatrai has based his challenge to the impugned order on a notification issued under s. 138(2) of the I.T. Act, 1961, dated June 23, 1965, by the central Govt. The material part of the said notification reads as follows [1965] 57 ITR 33:
'In exercise of the powers conferred by sub-section (2) of section 138 of the Income-tax Act, 1961 (XLIII of 1961) (hereinafter referred to as the Act) the Central Government, having regard to the practices and usages customary amount banking companies and to other relevant factors, hereby directs that no public servant shall -
(i) furnish any information contained in any statement made, return furnished or accounts or documents produced under the provision of the Act, or in any evidence given, affidavit or deposition made in the course of any assessment proceedings under the Act or the Indian Income-tax Act, 1922 (XI of 1922) (other than proceedings under Chapter XXII of the Act or Chapter VII of the Indian Income-tax Act, 1922), or in any record of any assessment proceedings or any proceedings relating to recovery of a demand, by or on behalf of or in respect of an assessee being a banking company within the meaning of section 34A of the banking companies Act, 1949 (X of 1949), or.....
Provided that nothing contained hereinbefore shall apply to the disclosure of such information (including the production of such documents or record) -.....'
3. We are not concerned in this appeal with the different causes of the proviso in the notification and hence they has not been reproduced.
4. The learned counsel for the appellant has contended that this is a notification of general application in cases of all assessee and that there is a clear bar imposed by the said notification against the I.T. authorities for furnishing any information from the assessment records of the claimant.
5. Now, it is well known that the provision of s. 137 of the I.T. Act, 1961, which were repealed by the Finance Act, 1964, with effect from April 1, 1964, placed an embargo on courts from calling for any returns, accounts, documents or any records relating to any assessee from the I.T Dept. notwithstanding the provision of the Evidence Act, 1872. When the provision of s. 137 were repealed with effect from April 1, 1964, the embargo against the courts, requiring a public servant to produce such records or to give evidence before it in respect there of and the prohibition against a public servant making a disclosure of any particular in the said documents, has been completely removed and the provision of the Evidence Act can be invoked by a partly with effect from April 1, 1964. Even though the total embargo imposed by the original provision in s. 137 was removed, the provisions of s. 138(2) of the I.T. Act empowered the Central Govt. in the case of as class of assessee to direct that no information or document shall be furnished or produced by a public servant in respect of assessment proceedings. Sub-section (2) of s. 138 reads as follows:
'(2) Notwithstanding anything contained in sub-section (1) or any other law for the time being in force, the Central Government may, having regard to the practice and usages customary or any other relevant factors, by order notified in the Official Gazette, direct that no information or document shall be furnished or produced by a public servant in respect of such matter relating to such class of assessee or except to such authorities as may be specified in the order.'
6. The notification which is relied upon by the learned counsel for the appellant is issued in the exercise of the power contained in the above-quoted provision. The question whether the notification relied upon is a notification of general application in the case of all assessees or whether, as contended on behalf of the respondents, it applies only in the case of a banking company has to be decided on the construction of the said notification. Now, the opening part of the notification refers to 'the practices and usages customary among banking companies and to other relevant factors'. Prima facie on a reading of the opening part of the notification, an indication is clearly given that while issuing the notification, the practice and usages customary among the banking companies have been considered by the Central Govt. at the time of issuing the notification. We are concerned only with cl. (i) of the notification and having analysed the notification carefully, we are left in not doubt that the notification is intended only to operate in respect of a banking company. The power under s. 138(2) of the I.T. Act, 1961, has to be exercised in order to prevent furnishing of any information or production of any documents by a public servant. That it the subject-matter of the notification. If cl. (i) of the notification is carefully read and analysed, broadly it can be dividend into three parts. The first part deals with the sources of the information and these sources are any statement made, return furnished or accounts or documents produced under the provision of the Act, or in any evidence given, affidavit or deposition made.
7. The second part describes the proceedings in which the statement or the returns or the accounts or evidence or affidavit or deposition has been made. This is clarified by suing the words 'in the course of any assessment proceedings under the Act or the Indian Income-tax Act, 1922 (XI of 1922), (other than proceedings under Chapter XXII of the Act or Chapter VIII of the Indian Income-tax Act, 1922), or in any record of any assessment proceedings or any proceedings relating to recovery of a demand'. These words will indicate that two kinds of proceedings are contemplated, one is the assessment proceedings and the other is the proceedings relating to the recovery of a demand. Reading the first and the second part together, to take an illustration, as information may be in any statement made either in the course of any assessment proceedings or it may be in any proceedings relating to the recovery of a demand. So far as the information given in any evidence is concerned, such evidence may have been given in the courses of any assessment proceedings or such evidence may be in any record of any assessment proceedings or such evidence may be in any proceedings relating to the recovery of a demand. Then the words used in the notification are 'by or on behalf of or in respect of an assessee' and theses words, excluding the material parenthetical clauses must qualify the earlier clauses dealing with the nature of information and the document in which the information is contained. Thus the material clauses will read 'furnished any information contained in any statement made, return furnished or accounts or documents produced under the provisions of the Act, out in any evidence given, affidavit or disposition made.... by or on behalf of or in respect of an assessee'. The assessment proceeding must, therefore, be in respect of an assessee; the information or the evidence, as the case may be, has to be given by or on behalf of an assessee and then the last part of the clauses identifies such assessee by using the words 'being a banking company within the meaning of section 34A of the Banking Companies Act, 1949 (X of 1949)'.
8. Read in the manner indicated above, and that is the only manner in which the said clause can be read, it is obvious to us that the notification was intended to operate only in respect of an assessee which was a banking company within the meaning of s. 34A of the Banking Companies Act; 1949.
9. Mr. Keshavdas appearing on behalf of the claimant wanted us to read the notification in such a manner that the words 'furnished any information contained in any statement made, return furnished or accounts or documents produced under the provision of the Act, or in any evidence given, affidavit or disposition made in the course of any assessment proceedings under the Act or the India Income-tax Act, 1922 (XI of 1922)' are independent of the remaining part of the clauses and the contention was that in respect of banking companies, it is only the letter part of the clause which becomes relevant. As we have indicated above, such a reading will be wholly contrary to the natural grammatical reading of the notification. There is clear indication in the clauses that the assessment proceedings or the proceedings relating to the recovery of a demand or the record of the assessment proceedings has to be in respect of an assessee which is a banking company. As already pointed out, if there was any doubt, that is wholly removed by the opening part of the notification which expressly reference to banking companies.
10. We may also point that Mr. Keshavdas has brought to our notice a decision of a learned single judge of the Orissa High court in Nazir Mohammad v. Jamila Bibi : [1972]85ITR342(Orissa) , where the notification in question has been descried as admittedly being 'with reference to an assessee being a banking company within the meaning of s. 34A of the Banking companies Act, 1949.'
11. It appears from the judgment that the learned judge had assumed that the said notification applied only in the case of a banking company. The decision is really not helpful to us except for the fact that before the Orissa High Court, the parties did not seem to dispute the nature of the notification.
12. The learned counsel has fairly not disputed before us that if this notification cannot be availed of by the claimant, then no value grievance can be made against the impugned order in this appeal. Since we have held that the notification operates only in respect of banking companies, we do not find any infirmity in the order appealed against. The appeal must, therefore, fail and is dismissed with costs in two sets. Costs quantified at Rs. 250 each per party.
13. Mr. Keshavdas requests that the order may not be given effect to because the appellant wants to move the Supreme Court. The official assignee will not proceed with the enquiry for a period of three weeks from today.
14. Application for leave to appeal to the Supreme Court rejected as we do not find that any other view on the construction of the notification is possible.