The Punjab and Haryana High Court on Wednesday dismissed petitions filed by former Punjab Chief Minister Amarinder Singh and his son Raninder Singh. The duo had challenged orders allowing the Enforcement Directorate (ED) to inspect documents connected to alleged foreign assets.
Justice Tribhuvan Dahiya held that the ED, being an investigating agency under FEMA, had the legal right to access records filed by the Income Tax Department before a Ludhiana court.
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Background
The dispute traces back to 2016 when the Income Tax Department lodged complaints against Amarinder Singh under provisions of the Income Tax Act and Indian Penal Code. Authorities alleged that the former CM and his family were beneficiaries of foreign assets and bank accounts, including one at HSBC Private Bank in Switzerland, and property in Dubai.
Information about these holdings was originally shared by French authorities with India's Central Board of Direct Taxes under a tax treaty. The ED later sought inspection of the same records for its own probe, which the trial court permitted in September 2020. That decision was upheld by a Sessions Judge in 2021.
Amarinder and Raninder Singh then approached the High Court, arguing that the ED was a "stranger" to the tax complaint and should not have been allowed access.
Justice Dahiya rejected the petitioners contention.
"The matter regarding inspection was between the Enforcement Directorate and the court. So, it was for the court seized with the matter to record its satisfaction and allow the inspection of the record to the stranger," the bench noted.
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The court referred to High Court rules that permit even outsiders to inspect case files if sufficient reasons exist. Since the ED is a statutory body mandated to investigate foreign exchange violations, denying it access would "create hurdles in investigation."
The petitioners had also relied on Article 28 of the India-France Double Taxation Avoidance Agreement, which requires secrecy in handling shared tax information. But the bench pointed out that the Supreme Court in the Ram Jethmalani case had already ruled that such clauses do not prevent courts from allowing disclosure in judicial proceedings.
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The Judge Observed,
"Here, the information is being sought by an organ of the State for the purpose of investigation which cannot be taken exception to in view of the settled law."
Concluding the matter, the High Court dismissed all three petitions filed by Amarinder and Raninder Singh. It upheld the ED's right to inspect the Income Tax Department’s complaint records before the Magistrate.
However, the court made it clear that such material "shall not be disseminated publicly unless permitted in accordance with law."
Case Title:- Amarinder Singh vs. Income Tax Department and another
Case Number:- CRM-M-37200-2021
