By TIOL News Service:

ERNAKULAM, AUG 22, 2016: THE issue is - Whether the right to privacy granted under Article 21 of the Constitution, can be pleaded as a ground to invalidate the provision of Section 133(6) of the I-T Act which provides the for the right of the State to gather information under its fiscal administration. NO IS THE ANSWER.

Facts of the case:

The assessees are Service Cooperative Banks and its members. They had preferred the present appeal challenging the provisions of Section 133(6) stating that it had infringed on the right to privacy guaranteed to them under Article 21 of the Constitution of India. The Single Judge bench of this court after considering the contentions advanced on either side, held that right to privacy could not be pleaded as a ground to invalidate a provision of the Income Tax Act, especially where the avowed object of the provision was to get details of financial transactions which could be associated with black money.

Having heard the parties, the High Court held that,

1. The contentions raised by the assessees based on the right to privacy the difficulty in collecting the necessary details as well as the futility of collection of details have been dealt with in detail by the Single Judge. The contention with regard to possible misuse of power has also been answered. The Single Judge after considering the safeguards incorporated in the statute found that sufficient guidelines were provided to guard against possible misuse of the provision. The Single Judge came to the conclusion that there was no arbitrariness or constitutional invalidity in the amendment in question. The standards to be applied when deciding the constitutional validity of a fiscal statute were also dealt with. The question whether right to privacy is a fundamental right or only a legal right as recognized in the Law of Torts is itself pending consideration before a Constitution bench of the Apex Court having been referred for an authoritative pronouncement by a three member bench in Justice K.S.Puttuswamy v. Union of India.

2. Even if it is a necessary corollary to the right to life, such a right would be subject to the reasonable restrictions which could be imposed by the State in exercise of its legislative power. When a legislation, especially one in the fiscal realm is being examined by courts to check whether it infringes the right of individuals to privacy in own affairs, it has to be borne in mind that the larger public and economic interest of nation is to be balanced against such right to privacy. All decisions which have espoused the right to privacy have been cautious in pointing out that such rights would not extend to militate against right of the State to gather information under its fiscal administration. Therefore, there seems no ground to interfere with the decision of the Single Judge in exercise of appellate jurisdiction through this intra court appeal filed u/s 5 of Kerala High Court Act.

(See 2016-TIOL-1786-HC-KERALA-IT)