The notice asks for the names of every depositor over a threshold. Is that not a fishing enquiry?
A Division Bench held it is not. The object of a s.133(6) notice is to collect information useful for or relevant to an enquiry for widening the tax base and unearthing undisclosed money, and a demand for depositor details is within that object. The approval required by the second proviso had been obtained, and the notices were upheld.
Decided by the High Court (N.K. Jain CJ and N. Kumar J) on 2001-12-07, reported as (2002) 255 ITR 502 (Kar); ILR 2002 KAR 284; (2002) 121 Taxman 532; 2002 Tax LR 268; Writ Appeal No. 1133 of 2001 and connected appeals (from Writ Petition No. 36445 of 2000). It bears on section 133(6), section 133 of the Income Tax Act 1961, in Evidence & Burden of Proof and Assessment & Scrutiny matters.
'Fishing enquiry' is the first objection most advisers reach for. This is the Division Bench answer to it, and it is the judgment the Supreme Court approved when it dismissed the bank's petitions in Karnataka Bank Ltd.
Binding within that High Court's jurisdiction. Persuasive elsewhere.
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Banks in Karnataka, including Janatha Bank through its General Manager, were served with notices under s.133(6) requiring details of depositors and customers. They challenged the notices before a single judge, who dismissed the petitions. In the writ appeals the banks argued that the demands amounted to a roving or fishing enquiry unconnected with any proceeding, and that the department could not call for such general information.
The writ appeals were dismissed. The Court rejected the roving-enquiry characterisation, holding that the whole object of issuing such a notice is to collect information useful for or relevant to an enquiry for widening the tax base and to unearth black money. It recorded that the prior approval contemplated by the second proviso to s.133(6) had been obtained before the notices were issued, and found no error or illegality in the single judge's order.
The Bench proceeded from the purpose of the amended sub-section rather than from the presence or absence of a pending assessment. Information gathering of this kind necessarily precedes formal proceedings, and a bank by its nature has many customers, so a demand framed by reference to a class or a threshold rather than a named assessee is the ordinary form such a demand must take. Because the second proviso's approval had been taken, the statutory safeguard on which the breadth of the power depends was satisfied, and there was no basis to interfere.
to collect information which is useful for or relevant to an enquiry for widening the tax base
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Handle my notice → Ask a CA on WhatsAppA Division Bench held it is not. The object of a s.133(6) notice is to collect information useful for or relevant to an enquiry for widening the tax base and unearthing undisclosed money, and a demand for depositor details is within that object. The approval required by the second proviso had been obtained, and the notices were upheld. This was decided by the High Court (N.K. Jain CJ and N. Kumar J) and bears on section 133(6), section 133 of the Income Tax Act 1961. It is reported as (2002) 255 ITR 502 (Kar); ILR 2002 KAR 284; (2002) 121 Taxman 532; 2002 Tax LR 268; Writ Appeal No. 1133 of 2001 and connected appeals (from Writ Petition No. 36445 of 2000). 'Fishing enquiry' is the first objection most advisers reach for. This is the Division Bench answer to it, and it is the judgment the Supreme Court approved when it dismissed the bank's petitions in Karnataka Bank Ltd. If it applies to you, the first step is this: Do not rest the reply on the breadth of the demand alone; breadth is not by itself an answer under this line of authority.
Banks in Karnataka, including Janatha Bank through its General Manager, were served with notices under s.133(6) requiring details of depositors and customers. They challenged the notices before a single judge, who dismissed the petitions. In the writ appeals the banks argued that the demands amounted to a roving or fishing enquiry unconnected with any proceeding, and that the department could not call for such general information. The matter was decided on 2001-12-07 by the High Court (N.K. Jain CJ and N. Kumar J). On those facts the High Court held as follows. The writ appeals were dismissed. The Court rejected the roving-enquiry characterisation, holding that the whole object of issuing such a notice is to collect information useful for or relevant to an enquiry for widening the tax base and to unearth black money. It recorded that the prior approval contemplated by the second proviso to s.133(6) had been obtained before the notices were issued, and found no error or illegality in the single judge's order.
The Bench proceeded from the purpose of the amended sub-section rather than from the presence or absence of a pending assessment. Information gathering of this kind necessarily precedes formal proceedings, and a bank by its nature has many customers, so a demand framed by reference to a class or a threshold rather than a named assessee is the ordinary form such a demand must take. Because the second proviso's approval had been taken, the statutory safeguard on which the breadth of the power depends was satisfied, and there was no basis to interfere. In the words reproduced by the source cited on this page: "to collect information which is useful for or relevant to an enquiry for widening the tax base"
It was decided by the High Court on 2001-12-07 and is reported as (2002) 255 ITR 502 (Kar); ILR 2002 KAR 284; (2002) 121 Taxman 532; 2002 Tax LR 268; Writ Appeal No. 1133 of 2001 and connected appeals (from Writ Petition No. 36445 of 2000). Binding within that High Court's jurisdiction. Persuasive elsewhere. A High Court decision binds the assessing officer, the Commissioner (Appeals) and the Income Tax Appellate Tribunal within that state, and is persuasive elsewhere. If your assessment is in a different jurisdiction, check whether your own High Court has taken the same view before relying on it. On section 133(6), section 133, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the department, and it appears in this library for that reason — you need to know what the Assessing Officer will cite against you. The writ appeals were dismissed. The Court rejected the roving-enquiry characterisation, holding that the whole object of issuing such a notice is to collect information useful for or relevant to an enquiry for widening the tax base and to unearth black money. It recorded that the prior approval contemplated by the second proviso to s.133(6) had been obtained before the notices were issued, and found no error or illegality in the single judge's order. It arises in Evidence & Burden of Proof and Assessment & Scrutiny matters, on section 133(6), section 133 of the Income Tax Act 1961, and was decided by N.K. Jain CJ and N. Kumar J. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Ask instead, in writing, whether the approval under the second proviso was obtained, and record the reply or the silence. Where the demand runs to thousands of accounts, ask for time and for a workable format rather than refusing - the Karnataka and Kerala courts have granted extensions, not exemptions. Keep the correspondence; it is the material for reasonable cause under s.273B if a penalty follows.
Still good law. The Supreme Court in Karnataka Bank Ltd v Secretary, Government of India, decided 25 February 2002, expressly agreed with the construction of s.133(6) placed on it by the single judge and the Division Bench of the Karnataka High Court. Nothing doubting or overruling this decision was found. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The judgment names N.K. Jain CJ as delivering it, with N. Kumar J on the Bench; the head of the report on the source was not relied on for that. The record shows these were writ appeals from an order of a single judge in Writ Petition No. 36445 of 2000 and connected matters, which is the same litigation that reached the Supreme Court as Karnataka Bank Ltd. The quoted words on the object of the notice are the Court's, but the document as retrieved does not carry running paragraph numbers, so no paragraph reference is given. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The writ appeals were dismissed. The Court rejected the roving-enquiry characterisation, holding that the whole object of issuing such a notice is to collect information useful for or relevant to an enquiry for widening the tax base and to unearth black money. It recorded that the prior approval contemplated by the second proviso to s.133(6) had been obtained before the notices were issued, and found no error or illegality in the single judge's order.
TaxSphere, “U.G. Upadhya v Director of Income-tax”, https://taxnotice.vittsphere.com/caselaw/case/ug-upadhya-v-dit-133-6-roving-enquiry-widening-tax-base/ (validity last checked 2026-09-17)
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The bank has a s.133(6) notice asking for customer loan-repayment details and there is no assessment pending on anyone. Can the officer do that?
We are exempt from deducting tax on these deposits. Does that also mean we need not give the information?
Our counsel wants to cite a Bombay case that says s.133(6) cannot be used for a fishing enquiry. Is it still good?
The letter from the Investigation wing cites a provision that does not exist. Is it void for that?
