MUKESH MANGLA vs. PRINCIPAL DIRECTOR OF INCOME TAX ( INVESTIGATION ) AND ANR
What did the High Court hold?
The Delhi High Court held that the seized jewellery is required to be released forthwith as the respondents cannot legitimately withhold it. The court noted that the petitioner had deposited the tax demand of Rs. 73,350/- on April 17, 2026, and the penalty of Rs. 13,362/- had been paid on December 14, 2025. The revenue, through its counsel, accepted these facts and further submitted that, as of the date of the order, no other proceedings were pending against the petitioner. In light of these circumstances, the court found no legitimate basis for the respondents to retain the jewellery. The writ petition was disposed of with a direction to the Principal Director of Income Tax (Investigations) to ensure the release of the petitioner's jewellery as early as possible, preferably before June 30, 2026. The petitioner was also directed to file a representation with the respondent along with necessary documents within seven days.
What were the facts?
The petitioner, Mukesh Mangla, filed a writ petition challenging search proceedings and seeking the release of jewellery seized on December 6, 2021. During the pendency of the petition, the Assessing Officer passed an assessment order on March 30, 2026. Out of the seized jewellery valued at Rs. 24,22,763/-, only jewellery worth Rs. 1,71,310/- remained unexplained. The petitioner agreed not to press the legality of the search but requested the release of the jewellery, having deposited the entire tax demand of Rs. 73,350/- on April 17, 2026. The revenue initially contended that no order for release should be passed until penalty proceedings were finalized. Subsequently, it was confirmed that the tax and penalty demands had been deposited, and no other proceedings were pending.
What were the issues?
1. Whether the petitioner is entitled to the release of jewellery seized during search proceedings, given that the tax demand has been paid and the penalty proceedings are either concluded or no other proceedings are pending. (Mixed question of law and fact, turning on the interpretation of provisions related to seizure and release of property under the Income Tax Act, 1961). Assessee's Contention: The petitioner argued that since the entire tax demand of Rs. 73,350/- was deposited on April 17, 2026, and the penalty of Rs. 13,362/- was paid on December 14, 2025, the seized jewellery should be released forthwith. The petitioner also stated that they would not press the challenge to the legality of the search. Revenue's Contention: Initially, the revenue argued that no order for the release of jewellery should be passed until the demand arising out of penalty proceedings was finalized. However, upon further instructions, the revenue accepted that the tax and penalty amounts had been deposited and that no other proceedings were pending against the petitioner.
AI-generated summary — verify with the full judgment below
$~96 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 9080/2024 MUKESH MANGLA
.....Petitioner Through: Mr. Arvind Kumar, Adv. versus PRINCIPAL DIRECTOR OF INCOME TAX ( INVESTIGATION ) AND ANR .....Respondents Through: Mr. Vipul Agrawal, SSC CORAM: HON'BLE MR. JUSTICE DINESH MEHTA HON'BLE MR. JUSTICE VINOD KUMAR O R D E R %
19.05.2026 1. On 22.04.2026, we have passed the following order : “1. The petitioner has challenged the search proceedings and sought a direction for release of the jewellery which was seized during search. 2. He submitted that during the pendency of the present writ petition the Assessing Officer has passed an assessment order on 30.03.2026 and out of the jewellery worth Rs. 24,22,763/- the entire jewellery except jewellery worth Rs. 1,71,310/- has been treated as explained. 3. He prayed that he would not press the case about the legality of the search, however, a direction be issued to the respondents to release the jewellery which was seized, while informing that he has deposited the entire demand (Rs.73,350/-) on 17.04.2026. 4. Mr. Vipul Agarwal, learned Senior Standing Counsel for the respondents on the other hand submitted that the penalty proceedings are yet to be completed and unless the demand This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 22/05/2026 at 12:26:30
arising out of the penalty proceedings is finalized, no order for the release of jewellery be passed. 5. The respondent-Assessing Officer is directed to calculate and inform Mr. Vipul Agarwal, the maximum amount of penalty which is likely to be imposed upon the petitioner, if he is not satisfied with the explanation furnished by the petitioner. 6. At this juncture, it is informed by Mr. Arvind Kumar, learned counsel for the petitioner, that the petitioner has filed reply in response to the notice of penalty and nothing more is to be added by the petitioner; therefore in order to give a quietus to the dispute. Assessing Officer be directed to pass final order qua the penalty proceedings. 7. List this case on 19.05.2026. 8. The Assessing Officer is directed to pass final order in accordance with law, pursuant to the penalty notice issued to the petitioner.” 2. Mr. Arvind Kumar, learned counsel for the petitioner at the outset submitted that the petitioner has deposited the tax demand of Rs.73,350/- on 17.04.2026 and penalty of Rs.13,362/- too has been paid on 14.12.2025. 3. He prayed that since the entire demand has been deposited, the jewellery be ordered to be released forthwith. 4. Mr. Vipul Agrawal, learned Senior Standing Counsel accepted the fact that the amount of tax and penalty stands deposited. On the basis of instructions, he further submitted that as of today, no other proceedings are pending against the petitioner. 5. Having regard to the facts noted above, we are of the view that the jewellery seized by the respondent on 06.12.2021 is required to be released forthwith, as the respondents cannot legitimately return the jewellery. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 22/05/2026 at 12:26:30
We, therefore, dispose of the present writ petition while directing Principal Director of Income Tax (Investigations)-respondent No.1, to ensure that the petitioner’s jewellery is released as early as possible, preferably before 30.06.2026. 7. The petitioner may file a representation before the respondent No.1 alongwith a photocopy of the seizure memo, valid proof of identity and a web copy of the order instant, within a period of seven days from today. 8. The present Writ petition stands disposed of in above terms. DINESH MEHTA, J VINOD KUMAR, J MAY 19, 2026/ss This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 22/05/2026 at 12:26:30
Recent GST High Court judgments
Search GST case law →- M/S Ritika Ispat PVT. Limited, Balanda, Sundargarh vs. The Commissioner Of Commercial Taxes And Goods And Services Tax, Odisha, CuttackOrissa · 4 Nov 2026
- M/S.Ritika Ispat PVT. LTD.,Balanda, Sundergarh vs. The Commissioner Of Commercial Taxes And Goods And Services Tax, Odisha, CuttackOrissa · 4 Nov 2026
- Biswanath Pradhan vs. The Principal Commnr., CGST And Central Excise, BhubaneswarOrissa · 4 Nov 2026
- M/S.Ritika Ispat PVT. LTD.,Balanda, Sundergarh vs. The Commissioner Of Commercial Taxes And Goods And Services Tax, Odisha, CuttackOrissa · 4 Nov 2026
- M/S Shree Sai Jagannath, Rourkela, Sundargarh vs. Chief Commissioner, CGST, Central Excise And Customs, BhubaneswarOrissa · 4 Nov 2026
