P.R Raman, J.:— The petitioner is a private limited company with unlimited liability engaged in the business of direct selling of principally fast moving consumer goods. Its registered office is at New Delhi. It started commercial operation in May, 1998. The first respondent is the Union of India and the second respondent is the Deputy Director of Income-tax (Investigation)-II, Ernakulam South, Cochin. The petitioner seeks to issue a writ of certiorari calling for the records and proceedings leading to exhibits P3 and P6 summons as modified by exhibit P8 letter dated August 10, 2001, and to quash the same and for a direction to the second respondent to forbear from taking any further steps pursuant to exhibits P8 and for other reliefs.

2. Exhibit P1 is a letter dated June 6, 2001, issued by the second respondent to the managing director of the petitioner Amway India Enterprises, New Delhi, as per which the petitioner was requested to furnish the true and complete details of all payments made by them to their distributors in Kerala, during the period from April 1, 1996, to March 31, 2001, with the names and complete addresses of the respective payees and the amount paid in each financial year, etc., and any other relevant details. This letter is issued in lieu of summoning the petitioner under section 131 of the Income-tax Act. Exhibit P2 is a reply thereto from the petitioner under date June 15, 2001, by which the petitioner sought for a clarification as to the exact provision of section 131 of the Income-tax Act, 1961, under which exhibit P1 notice has been issued. By exhibit P3 letter dated June 19, 2001, the second respondent informed the petitioner that the exact provision of section 131 of the Act under which exhibit P1 was issued was made clear from the letter itself. It was further informed that there is reason to suspect that the distributors of the petitioner company's products in Kerala are in receipt of remuneration (by whatever name called) from the petitioner-company which has not been fully and properly offered for income-tax assessment in their respective hands. For the purpose of making necessary enquiry and investigation thereto, relevant details were called for from the petitioner as per exhibit PI and thus, notice had been issued under section 131 read with section 131(1A) of the Income-tax Act. A formal summons was also enclosed along with exhibit P3. It was further informed that the personal appearance of the managing director is not essential provided the particulars called for are furnished on or before July 2, 2001. The summons enclosed under the same date requires the managing director of the petitioner-com-pany to attend the office of the second respondent at Ernakulam on July 2, 2001, to give evidence and produce books of account and other documents containing the particulars of all commission/remuneration to all the distributors in Kerala during the period April 1, 1996, to March 31, 2001. By exhibit P4 dated July 31, 2001, the petitioner-company informed the Additional Director of Income-tax (Investigation), Cochin, that they would extend all support to the Department and they have sought for opinion from their legal counsel to ascertain their legal rights in the matter and the advice is expected within one week. It was also informed that in the meanwhile, if the Department has any specific query on any particular distributor then they have no hesitation in providing the details. By exhibit P5 dated August 2, 2001, the second respondent wrote back to the petitioner that their request for additional time is opposed to all principles of fairness and decency and violation of law since they have failed to comply with the summons issued to them and it is proposed to initiate steps to impose penalty of Rs. 10,000 per day of default, from July 2, 2001, onwards up to July 31, 2001, besides prosecution under the general law. By exhibit P6 dated August 2, 2001, the second respondent informed the managing director of the petitioner-company at New Delhi, that his presence is required on August 10, 2001, to give evidence or to produce the books of account and other documents. This is a summon issued under section 131 read with section 131(1A) of the Income-tax Act, 1961, to which the petitioner, as per exhibit P7 submitted a detailed reply the gist of which is to inform the authorities that the notice suffers from the vice of vagueness as complete details of all payments are called for without any specific detail or transaction. According to them, requisition of books of account which run into a truckload, is neither proportionate nor legitimate but in the case of identification of any person or class of persons for whom there is reason to suspect, once the identity is disclosed they can provide the details of such person. The standard contract entered into between the distributors and the company is enclosed along with the basis of calculation of remuneration contained therein. The reply also highlights the fact that in the absence of the names and addresses of the distributors about whom the details are called for, the question of entertaining suspicion as contemplated under section 131 did not arise. Exhibit P8 is a letter dated August 10, 2001, from the second respondent referring to the letter dated August 9, 2001, of the senior manager of the petitioner-company on the subject of summons under section 131 issued on August 2, 2001. In this letter, the reason to suspect is stated as concealment of income. It is further stated that the reasons need not be communicated to the petitioner and class of persons referred to is distributors based in Kerala. Hence, according to them, the proceedings under section 131(1) are supported by reason to suspect the concealment of income as well as the class of persons and it was further clarified that what is sought is not the income-tax assessment particulars, but only the particulars of the commission/remuneration (by whatever name called) paid to the distributors based in Kerala. It is further clarified in exhibit P8 that what was required to be communicated is the nature of payment, the mode of payment—such as cheque/cash, etc., made to the distributors in Kerala. It is made clear that complete books of account are not required and it would be enough if details of the commission/remuneration paid to the distributors in Kerala are furnished. Hence, the objection was overruled. The period for which such information was called for was further limited to the period from September 1, 1999, to August 31, 2000 and from September 1, 2000, to August 31, 2001, to which by exhibit P9 the petitioner replied that the managing director is out of country and requested for time till September 10, 2001, to send necessary reply. It was thereafter, that this original petition was filed. The question that arises for consideration is as to whether the second respondent has authority to issue summons under section 131 read with section 131(1A) of the Income-tax Act requiring the petitioner to furnish the details of the distributors in Kerala for the period from September 1, 1999, to August 31, 2001? Even though exhibit PI was issued earlier calling for the details regarding payments to the distributors in Kerala during the period from April 1, 1996, to March 31, 2001, it was reiterated in exhibit P3 that the petitioner was required to be present to produce the books of account and other documents containing the particulars of all commission/batta in Kerala during the period from April 1, 1996, to March 31, 2001. By the subsequent correspondence with the parties ending with exhibit P8, it can be seen that what is sought to be enforced is exhibit P8 and what is required to be produced by the petitioner is not the entire records relating to the transaction in India, but only regarding the commission or remuneration paid to its distributors in Kerala for the period, from September 1, 1999, to August 31, 2001. Therefore, it is not necessary to consider the validity or otherwise of the summons issued requiring the petitioner to produce the books of account for the period April 1, 1996, onwards as exhibit P8 finally issued only requires the petitioner to produce the details of payments of commission or remuneration paid by the petitioner to their distributors in Kerala limiting the period from September 1, 1999, to August 31, 2001. If the petitioner complies with exhibit P8 it is unnecessary to comply with any other previous requests made in this behalf. Hence, the question as to whether exhibit P8 is validly issued alone is to be considered in this original petition. I say so, because even though the petitioner would contend that a truckload of books of account is not practical to be produced before the second respondent, and they have started their business only in 1998, and therefore, whether they can be asked to produce the books of account prior to the commencement of business, etc., actually does not arise for consideration at this point of time especially after exhibit P8 which has given a go-by to the earlier notice issued and exhibit P8 confines to the production of details regarding payments of remuneration made to the distributors of the petitioner in Kerala for the limited period from September 1, 1999, to August 31, 2001.

3. According to the petitioner, in order to invoke section 131(1A) there must be a reason to attract the provision and the second respondent erred and acted in excess of his jurisdiction while issuing exhibit P8 letter modifying exhibit P6 summons in that he failed to appreciate that a combined reading of sections 131 and 132 of the Act clearly indicate that the powers vested in the Assessing Officer, Deputy Commissioner (Appeals), Joint Commissioner, Commissioner (Appeals) and Chief Commissioner or Commissioner for discovery and inspection could necessarily relate only to those assessees within their jurisdiction in regard to whom the Director-General or Director or Joint Director or Assistant Director or Deputy Director or the authorised officer referred to in sub-section (1) of section 132 of the Act had reason to suspect that any income had been or was likely to be concealed by any person or class of persons within their jurisdiction and could not relate to the petitioner who was an assessee under the Company Circle 1(3), New Delhi, outside the jurisdiction of the second respondent and the other authorities described in sections 131 and 132 of the Act in Kerala. Even by exhibit P8 the identities of the person or class of persons contemplated by section 131(1A) have not been established which is required for the assumption of jurisdiction. It is also urged that after stating that what was sought for was not the petitioner's income-tax assessment particulars the second respondent could not have invoked the provisions of sub-section (1) of section 131 of the Act as the petitioner was already assessed by the Delhi authorities of the Income-tax Act. In other words, according to the petitioner, only the specific particulars regarding any particular distributor or distributors could be sought for and since the petitioner had more than 50,000 distributors in Kerala, there cannot be a basis or material before the second respondent for any cause to suspect concealment of income but only in the nature of roving enquiry.

4. Before we proceed to consider the contentions raised in this original petition, it is necessary to refer to the relevant provision under which the summons were issued. The summons were issued under section 131 read with section 131(1A) of the Income-tax Act. The relevant provisions read thus : “131. Power regarding discovery, production of evidence, etc.—(1) The Assessing Officer, Deputy Commissioner (Appeals), Joint Commissioner, Commissioner (Appeals) and Chief Commissioner or Commissioner shall, for the purposes of this Act, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the following matters, namely

(a) discovery and inspection;

(b) enforcing the attendance of any person, including any officer of a banking company and examining him on oath;

(c) compelling the production of books of account and other documents; and

(d) issuing commissions.

(1A) If the Director-General or Director or Joint Director or Assistant Director or Deputy Director, or the authorised officer referred to in sub-sec-tion (1) of section 132 before he takes action under clauses (i) to (v) of that subsection, has reason to suspect that any income has been concealed, or is likely to be concealed, by any person or class of persons, within his jurisdiction, then, for the purposes of making any enquiry or investigation relating thereto, it shall be competent for him to exercise the powers conferred under sub-sec-tion (1) of the income-tax authorities referred to in that sub-section, notwithstanding that no proceedings with respect to such person or class of persons are pending before him or any other income-tax authority.”

5. On a reading of section 131(1A) it can be seen that various officers referred to therein are vested with powers as are vested in the civil court while trying a suit in respect of discovery and inspection, enforcing the attendance of any person and examining him on oath, compelling the production of books of account and other documents and issuing summons. As per sub-section (1A) if the Director-General or Director or Joint Director or Assistant Director or Deputy Director or the authorised officer referred to in sub-section (1) of section 132 before he takes action under clauses (i) to (v) of that sub-section, has reason to suspect that any income has been concealed by any person or any class of persons within his jurisdiction then, for the purpose of making any enquiry or investigation relating thereto, it shall be competent for him to exercise the powers conferred under sub-section (1) on the income-tax authorities referred to in that sub-section, notwithstanding that no proceedings with respect to such person or class of persons are pending before him or any other income-tax authority.

6. As per section 132 (if any of the) the various officers as mentioned in subsection (1) of section 131 in consequence of information in his possession, has reason to believe that any person to whom a summons is issued to produce any books of account or other documents omits or fails to produce the same or has reason to believe that such person will not produce any such books of account or that any person in possession of any money, bullion, jewellery or other valuable article or thing represents either wholly or partly income or property which has not been disclosed, then the Director General or Director or the Chief Commissioner or Commissioner, etc., can enter and search at the place where he has reason to suspect that such books of account and other documents are kept.

7. Thus, before any action is proceeded to be taken under section 132, if the officer mentioned under sub-section (1A) of section 131 has reason to suspect that any income has been concealed or likely to be concealed by any person or class of persons then, for the purpose of such enquiry or investigation, it will be open for him to exercise the powers under section 131 notwithstanding that no proceedings with respect to such person are pending before him.

8. Thus, it can be seen that section 131 empowers the Assessing Officer, during the course of assessment proceedings, to issue summons for discovery or inspection or for production of books of account, as the case may be, as are vested in the civil court. On the other hand, section 131(1A) empowers the specific officer referred to therein including the Deputy Director to exercise the power under sub-section (1) notwithstanding the fact that no proceedings are pending before such authority and the summons so issued could be for the purpose of conducting an enquiry or investigation thereto provided he has reason to suspect that any income has been concealed or is likely to be concealed by a person or class of persons within his jurisdiction. If there is any reason to suspect concealment of income by any class of persons within his jurisdiction then he can exercise the power vested in him under section 131.

9. The contention of the petitioner is that the second respondent has acted in excess of his jurisdiction because he cannot invoke the provisions of section 131(1) for the reason that the petitioner had already been assessed to tax and he is not within the jurisdiction of the officer concerned who issued exhibit P8. I am unable to agree with this contention of the petitioner because for invoking the power under section 131 read with section 131(1A) the person to whom the summons is issued need not be within the jurisdiction of the officer concerned. On the other hand, if the officer concerned has reason to suspect that any person or class of persons in his jurisdiction is likely to conceal the income then he can invoke section 131 calling for the details from whomsoever concerned as empowered under section 131(1A). Therefore, the fact that the petitioner is not an assessee within the jurisdiction of the income-tax authorities in Kerala is of no relevance since the summons issued to a person need not be within the jurisdiction of the officer concerned. Summons is only for the purpose of an enquiry and what is called for is only details regarding commission/remuneration granted by the petitioner-company within the State of Kerala and within the jurisdiction of the officer concerned and a summon can be issued even to a witness who resides outside the territorial jurisdiction. In other words, the summons can be issued to a witness either for production of any document or for examining him, as the case may be, as empowered under section 131(1A) of the Act. The further contention that the details called for are not in respect of any particular distributor or distributors but a general one and, therefore, the second respondent has exceeded his jurisdiction also does not appear to be sustainable in law in the light of the clear provisions contained in section 131(1A) of the Income-tax Act which empowers the officers named therein to invoke the power under section 131, if there is any likelihood of concealment of income by any person or class of persons. Therefore, the distributors within the State of Kerala are the class of persons who are suspected to have concealed income or likely to conceal the income. It is in respect of such distributors alone, that?n enquiry is conducted for which details are called for.

10. In this connection, learned counsel for the petitioner relied on the decision of the Supreme Court in Barium Chemicals Ltd. v. A.J Rana, [1972] 42 Comp Cas 245. That was a case arising under the Foreign Exchange Regulation Act. Under section 19(2) of the said Act, an order was passed requisitioning documents for examination some of which were found to have no connection with the purpose for which documents would be called for under the relevant provision. The apex court held that there was no application of mind in respect of the remaining documents and, therefore, there is non-compliance of the requirements under the statute. There, the appellants were directed by the order impugned therein to furnish the documents mentioned in the schedule attached to the order. There were six items. The first five items related to letters and one telegram and the seventh item referred to are books, papers and other documents in the possession of the Registrar of the Supreme Court. On a perusal of the documents, it was found that hundreds of documents and letters are in the custody of the Registrar. It was in that context that it was held that there was no application of mind as an essential condition precedent to the making of an order is that the authority should have considered it necessary to obtain and examine for the purpose of the Act the specified information, book or other document. The element of due care and attention which is an essential ingredient of the phrase “considers it necessary” is lacking in the case. In Classic Builders and Developers v. Union of India, [2001] 251 ITR 492, the Madhya Pradesh High Court while considering sections 131 and 131(1A), held that a perusal of section 131(1A) of the Income-tax Act, 1961, would indicate that it empowers six authorities of the Income-tax Department to invoke/use the powers of sub-section (1) of section 131 on fulfilment of certain conditions specified in sub-section (1A). In that context it was also held thus (headnote):

“In sub-section (1A) of section 131 the words ‘referred to in sub-section (1) of section 132 before he takes action under clauses (i) to (v) of that subsection’ do not qualify the words Director-General, Director, Joint Director, Assistant Director and Deputy Director, but qualify only the last and sixth specified authority, viz., the authorised officer. The very object of enacting sub-section (1A) was to give more powers to these five specified authorities and if the five specified authorities mentioned therein are restricted only to cases of search and seizure under section 132, the very purpose of enactment of sub-section (1A) of section 131 would be defeated. The first five authorities specified in sub-section (1A) are in no way concerned with section 132 while exercising the powers under sub-section (1A) and powers under sub-section (1) of section 131. The reference to section 132 in sub-section (1A) is only to the authorised officer who is specifically empowered to conduct the search and seizure operation under section 132. By virtue of sub-section (1A) which was inserted with effect from October 1, 1975, and later amended on June 1, 1988, these five specified authorities were empowered to exercise powers under section 131(1). The clarificatory note issued by the Departmental Circular No. 551, dated January 23, 1990 ([1990] 183 ITR (St.) 7), also supports this view.”

11. There, the Deputy Director of Income-tax (Investigation) invoked his powers conferred on him under section 131(1A) of the Act and issued a commission as provided under section 131(1)(d) by which he directed the District Valuation Officer of the Income-tax Department to inspect the property under assessment. It was held that the Deputy Director was perfectly within his rights in independently exercising his powers in issuing a commission under section 131(1)(d) and that his act fell within the four corners of section 131(1A).

12. In this connection, it is relevant to note the decision of the Madhya Pradesh High Court in Arjun Singh v. Asst. Director of Income-tax, [2000] 246 ITR 363, wherein it was held as follows (headnote):

“The purpose of the power under sub-section (1) of section 131 of the Income-tax Act, 1961, is in aid of action under some provision under the Act and it is a well settled principle of law that all statutory bodies must act for the purpose of the statute, even though the term ‘for the purpose of the Act’ is not expressly stated. The purpose of exercise of power under sub-sections (1) and (1A) of section 131 is not the same, as the power under sub-section (1) operates in the field where the person is an assessee and proceedings are pending against him; whereas the power under sub-section (1A) operates in the field where there is no proceeding for assessment pending against any such person or class of persons and the enquiry/investigation is necessary for the purpose of making any enquiry/investigation on the basis of reason to suspect concealment or likelihood of concealment of income by such person or class of persons. The other requirement under sub-section (1A) of section 131 of the Act is that the authorities/officers mentioned therein in whose jurisdiction, the income is alleged to have been concealed or is likely to be concealed must have reason to suspect which in fact, is a condition precedent for the exercise of power and such reason or suspicion must be based on tangible material on record legally cognizable and not merely hearsay, conjectures and surmises… Such a power under section 131(1A) cannot be exercised for the purpose of reopening of an assessment under section 147.”

13. In this case, by exhibit P8 the second respondent has merely asked the petitioner to furnish the details regarding commission/remuneration if any paid to the distributors within the State of Kerala. Though earlier the entire books of account were directed to be produced, by exhibit P8 it was confined to the furnishing of the information regarding payments of’ commission or remuneration to the distributors within the State of Kerala, that too, for the period of September 1, 1999, to August 31, 2001. The summons is issued under section 131 read with section 131(1A) by an officer specified under section 131(1A). It is also stated that they have rea son to think that there is likelihood of concealment of income by a class of persons, namely, the distributors in the State of Kerala. In this connection, the Deputy Director of Income-tax, the second respondent has filed a counter-affidavit wherein it is averred that on the basis of the income-tax inspector's report and as personally directed by the Director of Income-tax (Investigation), Cochin, a letter was sent to the managing director of the petitioner, calling for certain details as evidenced by exhibit PI. It was reported to the Deputy Director of Income-tax (Investigation) by the Inspector of Income-tax that the company has a very wide network of thousands of distributors in Kerala and that many of them are earning Rs. 2 lakhs and more per year as commission whereas no tax was being deducted and they are not filing any income-tax returns. Exhibits R2(A)--copy of the Income-tax Inspector's report dated June 6, 2001, is produced along with the counter-affidavit. It is averred that as per exhibit P8 the petitioner was required to furnish particulars of commission paid in Kerala for the period from September 1, 1999, onwards only in respect of those distributors to whom the total commission paid during the relevant accounting year and years amounted to Rs. 50,000 and above. It was further averred in para. 8 of the counter-affidavit as follows : “There was reason to suspect, in the light of the Income-tax Inspector's report, that the petitioner's distributors in Kerala, a class of persons, had taxable income and were potential taxpayers, by virtue of the commission the petitioner had paid them, while no tax was being paid thereon, and thereby they were ‘concealing income’ within the meaning of section 131(1A)… The satisfaction was in good faith being based on the Income-tax Inspector's report, and not a pretence.” It is further averred in the same paragraph that:

“It was because the petitioner's local office in Kerala did not have the details required, that its head office was requested to furnish the same. The furnishing of the standard form of contract between the distributors and the petitioner was neither required, nor equivalent to furnishing the specific details called for.”

14. In para. 11, it is averred thus:

“In the light of the Income-tax Inspector's report, this second respondent had enough reason to suspect and believe that income was concealed or was likely to be concealed by a class of persons, namely, the distributors of the petitioner based in Kerala, within this second respondent's jurisdiction.”

15. In the light of the clear averments made by the second respondent and in the light of the fact that the details called for as per exhibit P8 is only relating to distributors within the State of Kerala to whom the total commission, etc., paid during the accounting year amounted to Rs. 50,000 and above and further limiting the period from September 1, 1999, to August 31, 2001, and the power having been exercised by the second respondent as per the provisions specified under section 131(1A) of the Act and the fact that there is likelihood of concealment of income, it cannot be said that the second respondent has exceeded his jurisdiction while issuing exhibit P8.

16. Hence, I see no ground to interfere with exhibit P8. However, since as per exhibit P8 the time for production of the details already expired on August 27, 2001, and September 30, 2001, respectively, time to furnish the details called for in exhibit P8 shall stand extended by one month from today. Subject to the above, the original petition is dismissed. No costs.