7[8Power of search and seizure.
37A. 9(1) Where the 10[Director General or
Director] or the 11[Chief Commissioner or Commissioner] or any such 12[Joint Director] or 13[Joint Commissioner] as may be empowered in this
behalf by the Board, in consequence of information in his possession, has
reason to believe that—
(a)
any person to whom a
notice under sub-section (4) of section 16 or a summons under section 37 was
issued to produce, or cause to be produced, any books of account or other
documents, has omitted or failed to produce, or cause to be produced, such
books of account or other documents as required by such notice or summons, or
(b)
any person to whom a
notice or summons as aforesaid has been or might be issued will not, or would
not, produce, or cause to be produced, any books of account or other documents
which will be useful for, or relevant to, any proceeding under this Act, or
(c)
any person is in
possession of 14[any money, bullion, jewellery or other valuable article or
thing] disproportionate to his known assets, particulars of which will be
useful for, or relevant to, any proceeding under this Act,
then,—
(A)
the 15[Director-General or Director] or the 16[Chief Commissioner or
Commissioner], as the
case may be,
may authorise any 17[Joint Director], 18[Joint Commissioner], 19[Assistant Director 20[or Deputy Director]], 21[Assistant Commissioner 20[or Deputy Commissioner] or Income-tax Officer],
or
(B)
such 17[Joint Director] or
18[Joint Commissioner] may authorise any 19[Assistant Director] 20[or Deputy Director] or
21[Assistant Commissioner 20[or Deputy
Commissioner] or Income-tax Officer],
(the officer so authorised in all cases being
hereafter in this section referred to as the authorised officer) to—
(i)
enter and search any
building, place, vessel, vehicle or aircraft where he has reason to suspect
that such books of account or other documents,
22[money,
bullion, jewellery or other valuable article or thing] are kept;
(ii)
search any person who
has got out of, or is about to get into, or is in, the building, place, vessel,
vehicle or aircraft, if the authorised officer has reason to suspect that such
person has secreted about his person any such books of account or other
documents, 22[money, bullionjewellery or other valuable article or
thing];
(iii)
break open the lock of
any door, box, locker, safe, almirah or other receptacle for exercising the
powers conferred by clause (i) where the keys thereof are not available;
23[(iv) seize any such books of account, other
documents, money, bullion, jewellery or other valuable article or thing found
as a result of such search;]
(v) place marks of identification on any such books of account
or other documents or make, or cause to be made, extracts or copies therefrom;
(vi)
make a note or an
inventory of 24[any money, bullion, jewellery or other valuable article or
thing] found which, in his opinion, will be useful for, or relevant to, any
proceeding under this Act:
25Provided that where any building, place, vessel, vehicle or
aircraft referred to in clause (i) is within the area of jurisdiction of
any 26[Chief Commissioner or
Commissioner] but such 26[Chief Commissioner or Commissioner] has no jurisdiction over the person
referred to in clause (a) or clause (b) or clause (c)
of this sub-section, then,
notwithstanding anything contained in 27[section 8],
it shall be competent for him to exercise the powers under this
sub-section in all cases where he has reason to believe that any delay in
getting the authorisation from the 28[Chief Commissioner or Commissioner] having jurisdiction over such
person may be prejudicial to the interests of the revenue :
29[Provided further that where it is not possible
or practicable to take physical possession of any valuable article or thing and
remove it to a safe place due to its volume, weight or other physical
characteristics or due to its being of a dangerous nature, the authorised
officer may serve an order on the owner or the person who is in immediate
possession or control thereof that he shall not remove, part with or otherwise
deal with it except with the previous permission of such authorised officer and
such action of the authorised officer shall be deemed to be seizure of such
valuable article or thing under clause (iv) of this sub-section.]
30(2) Where any 28[Chief Commissioner or Commissioner], in consequence
of information in his possession, has reason to suspect that any books of
account or other documents, 31[money, bullion, jewellery or other valuable article or thing] in
respect of which an officer has been authorised by the 32[Director General or
Director] or any other 33[Chief Commissioner or Commissioner] or any such 34[Joint Director] or 35[Joint Commissioner] as may
be empowered in this behalf by the Board to take action under clauses (i)
to (vi) of sub-section (1) are kept in any building, place, vessel,
vehicle or aircraft not mentioned in the authorisation under sub-section (1),
such 36[Chief Commissioner or
Commissioner] may, notwithstanding anything contained in 37[section 8], authorise the
said officer to take action under any of the clauses aforesaid in respect of
such building, place, vessel, vehicle or aircraft.
(3) The authorised officer may requisition the
services of any police officer or of any officer of the Central Government, or
of both, to assist him for all or any of the purposes specified in sub-section
(1) or sub-section (2) and it shall be the duty of every such officer to comply
with such requisition.
38[(3A) The authorised officer may, where it is not
practicable to seize any books of account, other documents, money, bullion,
jewellery or other valuable article or thing, for reasons other than those
mentioned in the second proviso to sub-section (1), serve an order on the owner
or the person who is in immediate possession or control thereof that he shall
not remove, part with or otherwise deal with it except with the previous
permission of such officer and such officer may take such steps as may be
necessary for ensuring compliance with this sub-section.
Explanation.—For the removal of doubts, it is hereby declared
that serving of an order as aforesaid under this sub-section shall not be
deemed to be seizure of such books of account, other documents, money, bullion,
jewellery or other valuable article or thing under clause (iv) of
sub-section (1).]
(4) The authorised officer may, during the course of
the search or seizure, examine on oath any person who is found to be in
possession or control of any books of account or other documents, articles or
things including money and any statement made by such person during such
examination may thereafter be used in evidence in any proceeding under this
Act.
38[Explanation.—For the removal of doubts, it is
hereby declared that the examination of any person under this sub-section may
be not merely in respect of any books of account, other documents or assets
found as a result of the search, but also in respect of matters relevant for
the purposes of any investigation connected with any proceedings under this
Act.]
(5) Where any books of account or other documents,
articles or things including money are found in the possession or control of
any person in the course of a search, it may be presumed that—
(i) such books of account or other
documents, articles or things including money belong to such person;
(ii) the contents of such books of account or other documents
are true; and
(iii) 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 that person’s
handwriting, and in the case of a 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.
39[(5A) Where any money, bullion, jewellery or other
valuable article or thing (hereafter in this section and in sections 37B and
37C referred to as the assets) is seized under sub-section (1) or sub-section
(2), the Assessing Officer, after affording a reasonable opportunity to the
person concerned of being heard and making such inquiry as may be prescribed,
shall, within one hundred and twenty days of the seizure, make an order, with
the previous approval of the 40[Joint] Commissioner,—
(i) estimating the undisclosed net wealth in a summary manner
to the best of his judgment on the basis of such materials as are available
with him;
(ii) calculating the amount of tax on the net wealth so
estimated in accordance with the provisions of this Act;
(iii) determining the amount of interest
payable and the amount of any penalty imposable in accordance with the
provisions of this Act, as if the order had been the order of regular
assessment;
(iv) specifying the amount that will be required to satisfy any
existing liability under this Act in respect of which such person is in default
or is deemed to be in default, and retain in his custody such assets or part
thereof as are in his opinion sufficient to satisfy the aggregate of the
amounts referred it in clauses (ii), (iii) and (iv) and
forthwith release the remaining portion, if any, of the assets to the person
from whose custody they were seized:
Provided that where a person has paid or made satisfactory
arrangements for payment of all the amounts referred to in clauses (ii),
(iii) and (iv) or any part thereof, the Assessing Officer, may
with the previous approval of the Chief Commissioner or Commissioner release
the assets or such part thereof as he may deem fit in the circumstances of the
case.
(5B) The assets retained under sub-section (5A) may
be dealt with in accordance with the provisions of section 37C.
(5C) If the Assessing Officer is satisfied that the
seized assets or any part thereof were held by such person for or on behalf of
any other person, the Assessing Officer may proceed under sub-section (5A)
against such other person and all the provisions of this section shall apply
accordingly.]
(6) The books of account or other documents, seized
under sub-section (1) or sub-section (2), shall not be retained by the
authorised officer for a period exceeding one hundred and eighty days from the
date of the seizure unless the reasons for retaining the same are recorded by
him in writing and the approval of the 41[Chief Commissioner or Commissioner] for such
retention is obtained:
Provided that the 41[Chief Commissioner or Commissioner] shall not
authorise the retention of the books of account or other documents for a period
exceeding thirty days after all the proceedings under this Act in respect of
the years for which the books of
account or other documents are relevant are completed.
42[(6A) An order under sub-section (3A) shall not be in
force for a period exceeding sixty days from the date of the order, except
where the authorised officer, for reasons to be recorded in writing by him,
extends the period of operation of the order beyond sixty days, after obtaining
the approval of the 43[Director or, as the case may be, Commissioner] for such extension:
Provided that the 43[Director or, as the case may be, Commissioner] shall
not approve the extension of the period for any period beyond the expiry of
thirty days after the completion of the proceedings under this Act in respect
of the years for which the books of
account, other documents, money, bullion, jewellery or other valuable articles
or things are relevant.]
(7) The person from whose custody any books of
account or other documents are seized under sub-section (1) or sub-section (2)
may make copies thereof, or take extracts therefrom, in the presence of the
authorised officer or any other person empowered by him in this behalf at such
place and time as the authorised officer may appoint in this behalf.
(8) Where the authorised officer has no jurisdiction
over the person referred to in clause (a) or clause (b) or clause
(c) of sub-section (1), the books of account or other documents seized
under that sub-section shall be handed over by the authorised officer to the 44[Assessing Officer] having jurisdiction
over such person within a period of fifteen days of such seizure and thereupon
the powers exercisable by the authorised officer under sub-section (6) or
sub-section (7) shall be exercisable by such 44[Assessing Officer].
(9) If a person legally entitled to the books of
account or other documents seized under sub-section (1) or sub-section (2)
objects for any reason to the approval given by the 45[Chief Commissioner or
Commissioner] under sub-section (6), he may make an application to the Board
stating therein the reasons for such objection and requesting for the return of
the books of account or other documents.
46[(9A) If any person objects for any reason to an
order made under sub-section (5A), he may, within thirty days from the date of
such order, make an application to the Chief Commissioner or Commissioner
stating therein the reasons for such objection and requesting for appropriate
relief in the matter.]
47[(10) On receipt of the application under sub-section
(9), the Board, or on receipt of the application under sub-section (9A), the
Chief Commissioner or Commissioner, may, after giving the applicant an opportunity
of being heard, pass such orders as it or he thinks fit.]
(11) The provisions of the Code of Criminal
Procedure, 1973 (2 of 1974), relating to searches shall apply, so far as may
be, to searches under this section.
(12) The Board may make rules in relation to searches
or seizure under this section; and in particular and without prejudice to the
generality of the foregoing power, such rules may provide for the procedure to
be followed by the authorised officer—
(i) for obtaining ingress into any building,
place, vessel, vehicle or aircraft to be searched where free ingress thereto is
not available;
(ii) for ensuring the safe custody of any books of account or
other documents seized.
48[Explanation 1.—In computing the period
referred to in sub-section (5A) for the purposes of that sub-section, any
period during which any proceeding under this section is stayed by an order or
injunction of any court shall be excluded.
Explanation 2.—In this section, the word “proceeding”means any
proceeding in respect of any year under 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 proceedings under this Act
which may be commenced after such date in respect of any year.]