Income Tax Act

Official PDF pages 326–330

SOURCE PDF PAGE 326
( a )   any statement made by such person, during such examination may
thereafter be used in evidence in any proceeding under the Income-tax
Act, 1961 (43 of 1961) or this Act; and
( b )   the examination of any such person may not be merely in respect of any
books of account or other documents, or any information in electronic
form or on a computer system, or assets found as a result of the search,
but also in respect of all matters relevant for the purposes of any inves -
tigation connected with any proceeding under the Income-tax Act, 1961
(43 of 1961) or this Act.
(7) Where any person is found to be in possession or control of any books of
account or other documents, or asset, or any information in electronic form or on
a computer system, or having access to such computer system in the course of a
search, it may be presumed—
( a )   that such books of account or other documents, or such information or
asset or computer system belong or belongs to such person;
( b )   that the contents of such books of account or other documents, or such
information or computer system are true;
( c )   that the signature and every other part of such books of account or other
documents which purport to be in the handwriting of any particular
person or which may reasonably be assumed to have been signed by, or
to be in the handwriting of, any particular person, are in the handwriting
of that person;
( d )   in the case of such document stamped, executed or attested, that it was
duly stamped and executed or attested by the person by whom it purports
to have been so executed or attested; and
( e )   that exchange of such information in electronic form, or on such
computer system purported to be exchanged between any parties, is
exchanged between the parties thereto.
(8) The authorised officer may, by order in writing, provisionally attach any property
belonging to the assessee, during the course of the search or seizure, or within a
period of sixty days from the date of execution of the last of the authorisations for
the search and such provisional attachment shall––
( a )   be made, if the authorised officer is satisfied, after recording the reasons
in writing, that it is necessary to do so in the interest of the revenue, with
the prior approval of Principal Director General or Director General or
the Principal Director or Director; and
( b )   be valid for six months from the end of the month in which the order of
provisional attachment is made, and the rules in this behalf made under
section 413 shall,   mutatis mutandis , apply to such provisional attachment.
(9) The authorised officer may, during the course of the search or seizure, or within
sixty days from the date on which the last of the authorisations for search was exe -
cuted, make a reference to a Valuation Officer, or any person registered as a valuer
under section 514, or any person or entity registered by or under any law in force, as
may be approved by the Principal Chief Commissioner or the Chief Commissioner

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or the Principal Director General or the Director General, in accordance with the
procedure as may be prescribed in this regard, requiring him to—
( a )   estimate the fair market value of the property in the manner, as may be
prescribed; and
( b )   submit a report of the estimate to the authorised officer or the Assessing
Officer, within sixty days from the date of receipt of such reference.
(10) The provisions of the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023)
relating to searches and seizure shall apply, so far as may be, to search and seizure
under this section.
(11) The Board may make rules in relation to any search or seizure under this section
including providing for the procedure to be followed by the authorised officer—
( a )   for obtaining ingress into any building, place, vessel, vehicle or aircraft
to be searched where free ingress thereto is not available; and
( b )   for ensuring safe custody of any books of account or other documents,
or asset, or any information in electronic form or on a computer system,
or computer system seized.
(12) For the purposes of this section, the word “proceeding” means any proceeding
in respect of any year, whether under the Income-tax Act, 1961 (43 of 1961), or this
Act, which may be pending on the date on which a search is authorised under this
section or which may have been completed on or before such date and includes
also all proceedings under this Act which may be commenced after such date in
respect of any year.
Powers to requisition.
248.   (1) Where the approving authority, in consequence of information in his
possession, has reason to believe that—
( a )   any person to whom a summons under section 131(1)   or a notice under
section 142(1) of the Income-tax Act, 1961   (43 of 1961)   or summons
under section 246(1), or notice under section 268(1) of this Act was
issued to produce, or cause to be produced, any books of account or
other documents, or any information in electronic form or on a computer
system has omitted or failed to produce, or cause to be produced, such
books of account or other documents, or such information as required
by such summons or notice and the said books of account or other
documents, or any computer system containing the said information
have been taken into custody by any officer or authority
75  
under any
other law for the time being in force; or
( b )   any books of account or other documents, or any information in elec -
tronic form or on a computer system will be useful for, or relevant to,
any proceeding under the Income-tax Act, 1961   (43 of 1961)   or this Act
and any person to whom a summons or notice as aforesaid has been or
might be issued will not, or would not, produce or cause to be produced,
such books of account or other documents, or such information on the
return of such books of account or other documents or computer system
containing such information by any officer or authority by whom or by

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which such books of account or other documents or computer system
containing the said information have been taken into custody
75  
under
any other law for the time being in force; or
( c )   any assets represent either wholly or partly income or property which
has not been, or would not have been, disclosed for the purposes of the
Income-tax Act, 1961   (43 of 1961)   or this Act by any person from whose
possession or control such assets have been taken into custody by any
officer or authority under any other law for the time being in force,
then, the approving authority may authorise any, Joint Director or Joint Commis -
sioner or Assistant Director or Assistant Commissioner or Income-tax Officer (herein
and in section 489(2)   referred to as the requisitioning officer) to require the officer
or authority referred to in clause ( a ) or ( b ) or ( c ), to deliver such assets or books of
account or other documents, or computer system containing such information to
the requisitioning officer.
(2) On a requisition being made under sub-section (1), the officer or authority referred
to in clause ( a ) or ( b ) or ( c ), of that sub-section, shall deliver such assets or books
of account or other documents, or computer system containing such information
to the requisitioning officer either forthwith or when such officer or authority is of
the opinion that it is no longer necessary to retain the same in his or its custody.
(3) Where any assets or books of account or other documents, or computer system
containing such information have been delivered to the requisitioning officer, the
provisions of sections 247(4)( b ), 247(7) to (11), 250 and 251 shall, so far as may
be, apply as if such books of account or other documents, or computer system
containing such information or assets had been seized under section 247 by the
requisitioning officer from the custody of the person referred to in sub-section (1)
( a ) or ( b ) or ( c ), and as if for the words “the authorised officer”, occurring in any
of the sections 247(4)( b ), 247(7) to (11), 250 and 251, the words “the requisitioning
officer” were substituted.
Reasons not to be disclosed.
249.   The reason to believe or reason to suspect, as referred to in section 247 or
248, recorded by the income-tax authority shall not be disclosed to any person
or authority or the Appellate Tribunal.
Application of seized or requisitioned assets.
250.   (1) The amount of the following liabilities may be recovered out of the
assets seized under section 247 or requisitioned under section 248 in the
following manner, namely:—
( a )   the amount of any existing liability (other than advance tax payable
under the provisions of Part C of Chapter XIX) of this Act, the Income-tax
Act, 1961 (43 of 1961), the Black Money (Undisclosed Foreign Income
and Assets) and Imposition of Tax Act, 2015 (22 of 2015) and in respect
of which such person is in default or is deemed to be in default;
( b )   the amount of the liability determined on completion of the assessment
or reassessment or recomputation and the assessment of the year rele -
vant to the tax year in which search is initiated or requisition is made,
or the amount of liability determined on completion of the assessment

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under Part B of Chapter XVI for the block period, as the case may be
(including any penalty levied or interest payable in connection with
such assessment), and in respect of which such person is in default or
is deemed to be in default;
( c )   the amount of liability arising on an application made before the Interim
Boards for Settlement under section 245C(1) of the Income-tax Act, 1961
(43 of 1961).
(2) The Assessing Officer may release the assets seized as referred to in sub-section (1)
or portion of such asset to the person from whose custody the assets were seized, on
an application made by the person concerned within thirty days from the end of the
month in which the asset was seized, on fulfilment of the following requirements:––
( a )   after being satisfied on the basis of explanation furnished by such person
that the nature and source of acquisition of such assets is explained;
( b )   after recovering any existing liability referred to in sub-section (1) out
of such assets; and
( c )   after obtaining prior approval of the Principal Chief Commissioner or
Chief Commissioner or Principal Commissioner or Commissioner.
(3) The assets referred to in sub-section (2) shall be released within one hundred
and twenty days from the date on which the last of the authorisations for the search
or requisition was executed.
(4) If the assets as referred to in sub-section (1) consist solely of money, or partly of
money and partly of other assets, the Assessing Officer may apply such money in
the discharge of the liabilities referred to in sub-section (1) and the assessee shall
be discharged of such liability to the extent of the money so applied.
(5) The assets, other than money, may also be applied for discharge of liabilities
referred to in sub-section (1), as remains undischarged, and shall be deemed to
be under distraint as if such distraint was effected by the Assessing Officer or Tax
Recovery Officer under authorisation from the Principal Chief Commissioner or
Chief Commissioner or Principal Commissioner or Commissioner under section
416(7)   and the recovery of any liability out of such assets shall be effected in such
manner as may be prescribed.
(6) The mode of recovery of liabilities under sub-section (1) shall not preclude the
recovery of liabilities aforesaid by any other mode laid down in this Act.
(7) Any assets or proceeds thereof, which remain after the liabilities referred to in
sub-section (1) are discharged shall be forthwith made over or paid to the person
from whose custody the assets were seized.
(8) The Central Government shall pay simple interest at the rate of 0.5% for every
month or part of a month for the period on the amount determined in accordance
with the following formula:––
(A – B) + (C – D)
where—
A =   the aggregate amount of money seized under section 247 or requisitioned
under section 248;

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B =   the amount of money, if any, released under sub-section (2);
C =   the proceeds, if any, of the assets sold towards the discharge of the liability
under sub-section (1); and
D =   the aggregate amount required to meet the liabilities referred to in
sub-section (1).
(9) The period referred to in sub-section (8) shall be from the date immediately fol -
lowing the expiry of one hundred and twenty days from the date on which the last
of the authorisations for the search under section 247 or requisition under section
248 was executed to the date of completion of the assessment or reassessment or
recomputation.
Copying, extraction, retention and release of books of account and documents
seized or requisitioned.
251 .   (1) Where the authorised officer referred to in section 247(1) has no
jurisdiction over the person referred to in section 247(1)( a ) or ( b ), assets and
material seized or requisitioned under section 247(1) to 247(4)   shall be handed over
to the Assessing Officer having jurisdiction over such person within a period of one
hundred and eighty days from the date on which a search is initiated under section
247 or requisition is made under section 248 and such Assessing Officer thereupon
shall exercise the powers under sub-sections (2) and (3).
(2) The authorised officer shall, on an application made by the person from whose
custody any material seized or requisitioned, are seized under section 247(1) to (4),
allow such person, in the presence of such officer or any other person empowered
by such officer in this behalf, to make copies thereof or take extracts therefrom, at
such place and time as appointed by such officer.
(3) The authorised officer may––
( a )   retain the assets and material seized or requisitioned, under section 247
or 248, up to one month from the end of the quarter in which the order
of assessment or reassessment or recomputation is made under section
270(10) or section 271 or section 279 or section 294(1)( c );
( b )   retain such assets and material seized or requisitioned, beyond the period
specified in clause ( a ), after recording reasons in writing and obtaining
approval from the approving authority.
(4) The approving authority shall not allow the retention of assets and material seized
or requisitioned, beyond thirty days from the date on which all the proceedings
under the Income-tax Act, 1961 (43 of 1961) or this Act in respect of the years for
which the assets and material seized or requisitioned are relevant, are completed.
(5) If a person legally entitled to the assets and material seized or requisitioned
under section 247(1) to (4) or section 248, objects for any reason, to the approval
given by approving authority under sub-section (3)( b ), he may make an application
to the Board stating therein the reasons for such objection and requesting for the
return of the assets and material seized or requisitioned and the Board may, after
giving the applicant an opportunity of being heard, pass such orders as it thinks fit.