CHAPTER XIII

CHAPTER XIII

INCOME-TAX AUTHORITIES

A.—Appointment and control

1[J1] [116. Income-tax authorities:-

There shall be the following classes of income-tax authorities for the purposes of this Act, namely:—

(a) The Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 19632[J2] (54 of 1963),

(b) Directors-General of Income-tax or Chief Commissioners of Income-tax,

3[J3] [(cc) Additional Directors of Income-tax or Additional Commissioners of Income-tax or Additional Commissioners of Income-tax (Appeals),]

4[J4] [(cca) Joint Directors of Income-tax or Joint Commissioners of Income-tax,]

(d) Deputy Directors of Income-tax or Deputy Commissioners of Income-tax or Deputy Commissioners of Income-tax (Appeals),

(e) Assistant Directors of Income-tax or Assistant Commissioners of Income-tax,

(f) Income-tax Officers,

(g) Tax Recovery Officers,

(h) Inspectors of Income-tax.]

1[J5] [117. Appointment of income-tax authorities2[J6] :-

(1) The Central Government may appoint such persons as it thinks fit to be income-tax authorities.

(2) Without prejudice to the provisions of sub-section (1), and subject to the rules and orders of the Central Government regulating the conditions of service of persons in public services and posts, the Central Government may authorise the Board, or a Director-General, a Chief Commissioner or a Director or a Commissioner to appoint income-tax authorities below the rank of an Assistant Commissioner3[J7] [or Deputy Commissioner].

(3) Subject to the rules and orders of the Central Government regulating the conditions of service of persons in public services and posts, an income-tax authority authorised in this behalf by the Board may appoint such executive or ministerial staff as may be necessary to assist it in the execution of its functions.]

1[J8] [118. Control of income-tax authorities2[J9] :-

The Board may, by notification in the Official Gazette, direct that any income-tax authority or authorities specified in the notification shall be subordinate to such other income-tax authority or authorities as may be specified in such notification.]

1[J10] [119. Instructions to subordinate authorities:-

(1) The Board may, from time to time, issue such orders, instructions and directions to other income-tax authorities as it may deem fit for the proper administration of this Act, and such authorities and all other persons employed in the execution of this Act shall observe and follow such orders, instructions and directions of the Board:

Provided that no such orders, instructions or directions shall be issued—

(a) So as to require any income-tax authority to make a particular assessment or to dispose of a particular case in a particular manner; or

(b) So as to interfere with the discretion of the 2[J11] [* * *] 3[J12] [Commissioner (Appeals)] in the exercise of his appellate functions.

(2) Without prejudice to the generality of the foregoing power,—

4[J13] (a) the Board may, if it considers it necessary or expedient so to do, for the purpose of proper and efficient management of the work of assessment and collection of revenue, issue, from time to time (whether by way of relaxation of any of the provisions of sections 5[J14] [115P, 115S,] 6[J15] [115WD, 115WE, 115WF, 115WG, 115WH, 115WJ, 115WK,] 7[J16] [139], 143, 144, 147, 148, 154, 155, 8[J17] [158BFA,] 9[J18] [sub-section (1A) of section 201, sections 210, 211, 10[J19] [234A, 234B], 234C], 271 and 273 or otherwise), general or special orders in respect of any class of incomes 11[J20] [or fringe benefits] or class of cases, setting forth directions or instructions (not being prejudicial to assessees) as to the guidelines, principles or procedures to be followed by other income-tax authorities in the work relating to assessment or collection of revenue or the initiation of proceedings for the imposition of penalties and any such order may, if the Board is of opinion that it is necessary in the public interest so to do, be published and circulated in the prescribed manner for general information;

(b) the Board may, if it considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order, authorise 12[J21] [any income-tax authority, not being a 13[J22] [* * *] Commissioner (Appeals)] to admit an application or claim for any exemption, deduction, refund or any other relief under this Act after the expiry of the period specified by or under this Act for making such application or claim and deal with the same on merits in accordance with law;

14[J23] [(c) the Board may, if it considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order for reasons to be specified therein, relax any requirement contained in any of the provisions of Chapter IV or Chapter VIA, where the assessee has failed to comply with any requirement specified in such provision for claiming deduction there under, subject to the following conditions, namely:—

(i) The default in complying with such requirement was due to circumstances beyond the control of the assessee; and

(ii) The assessee has complied with such requirement before the completion of assessment in relation to the previous year in which such deduction is claimed:

Provided that the Central Government shall cause every order issued under this clause to be laid before each House of Parliament.]

[(3) Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

DEPARTMENTAL VIEW/SUPREME COURT RULING

1. Assessing Officers have been authorised to admit belated refund claims in respect of amounts up to Rs. 10,000 provided the following conditions are fulfilled:

(i) The refund arising as a result of excess advance tax payment in respect of assessment year under section 208 does not exceed Rs. 10,000;

(ii) The returned income is not a loss, where the assessee claims the benefit of carry forward of the loss;

(iii) The refund claimed is not supplementary in nature; and

(iv) The income of the assessee is not assessable in the hands of any other person. [Circular No. 521, dated 17th August, 1988]

2. Income-tax Officers have been authorised to admit and dispose of on merits applications filed by the assesses under section 220(3) by waiving in appropriate cases the time limit fixed under the said section. [Order No. 404/2/70/72, dated 30th August, 1973]

3. Wherever an error in favour of the assessee is pointed out by the Internal/ Revenue audit parties and this has been accepted by the Department as final, the same shall be rectified by the authorities concerned even if the rectification has to be carried out beyond the period specified in section 154(7). [Letter No. 245/79/72, dated 14th June, 1972]

4. The advice given by the board will not be in the nature of directions or instructions and it would be for the authority concerned to come to a decision on the merits of the case in the light of his individual judgement. It would be necessary to ensure that the income-tax authorities refrain from quoting or referring to the advice or guidance given by the Board in any order passed by them. [Instruction No. 796, dated 12th November, 1974]

5. A circular by the tax authorities is not binding on the courts. It is not binding on the assessee. However, the interpretation that is thereby placed by the taxing authority on the law is binding on that taxing authority. In other words, the taxing authority cannot be heard to advance an argument that is contrary to that interpretation. [CST v Indra Industries (2001) 248 ITR 338 (SC)]

6. The circulars issued by the Board are binding on the Department. The Department is precluded from challenging the correctness of the said circulars even on the ground of the same being inconsistent with the statutory provision. So far as the Department is concerned, whatever action it has to take, the same will have to be consistent with the circular which is in force at the relevant point of time. [Paper Products Ltd. v CCE (2001) 247 ITR 128 (SC)]

B.—Jurisdiction

1[J24] [120. Jurisdiction of income-tax authorities :-

(1) Income-tax authorities shall exercise all or any of the powers and perform all or any of the functions conferred on, or, as the case may be, assigned to such authorities by or under this Act in accordance with such directions as the Board may issue for the exercise of the powers and performance of the functions by all or any of those authorities.

2[J25] [Explanation.—For the removal of doubts, it is hereby declared that any income-tax authority, being an authority higher in rank, may, if so directed by the Board, exercise the powers and perform the functions of the income-tax authority lower in rank and any such direction issued by the Board shall be deemed to be a direction issued under sub-section (1).]

(2) The directions of the Board under sub-section (1) may authorise any other income-tax authority to issue orders in writing for the exercise of the powers and performance of the functions by all or any of the other income-tax authorities who are subordinate to it.

(3) In issuing the directions or orders referred to in sub-sections (1) and (2), the Board or other income-tax authority authorised by it may have regard to any one or more of the following criteria, namely:—

(a) Territorial area;

(b) Persons or classes of persons;

(d) Cases or classes of cases.

(4) Without prejudice to the provisions of sub-sections (1) and (2), the Board may, by general or special order,3[J26] and subject to such conditions, restrictions or limitations as may be specified therein,—

(a) Authorise any Director General or Director to perform such functions of any other income-tax authority as may be assigned to him by the Board;

(b) empower the Director General or Chief Commissioner or Commissioner to issue orders in writing that the powers and functions conferred on, or as the case may be, assigned to, the Assessing Officer by or under this Act in respect of any specified area or persons or classes of persons or incomes or classes of income or cases or classes of cases, shall be exercised or performed by 4[J27] [an Additional Commissioner or] 5[J28] [an Additional Director or] a 6[J29] [Joint] Commissioner 7[J30] [or a 8[J31] [Joint] Director], and, where any order is made under this clause, references in any other provision of this Act, or in any rule made there under to the Assessing Officer shall be deemed to be references to such 9[J32] [Additional Commissioner or] 10[J33] [Additional Director or] 11[J34] [Joint] Commissioner 12[J35] [or 13[J36] [Joint] Director] by whom the powers and functions are to be exercised or performed under such order, and any provision of this Act requiring approval or sanction of the 14[J37] [Joint] Commissioner shall not apply.

(5) The directions and orders referred to in sub-sections (1) and (2) may, wherever considered necessary or appropriate for the proper management of the work, require two or more Assessing Officers (whether or not of the same class) to exercise and perform, concurrently, the powers and functions in respect of any area or persons or classes of persons or incomes or classes of income or cases or classes of cases; and, where such powers and functions are exercised and performed concurrently by the Assessing Officers of different classes, any authority lower in rank amongst them shall exercise the powers and perform the functions as any higher authority amongst them may direct, and, further, references in any other provision of this Act or in any rule made there under to the Assessing Officer shall be deemed to be references to such higher authority and any provision of this Act requiring approval or sanction of any such authority shall not apply.

(6) Notwithstanding anything contained in any direction or order issued under this section, or in section 124, the Board may, by notification15[J38] in the Official Gazette, direct that for the purpose of furnishing of the return of income or the doing of any other act or thing under this Act or any rule made there under by any person or class of persons, the income-tax authority exercising and performing the powers and functions in relation to the said person or class of persons shall be such authority as may be specified in the notification.]

DEPARTMENTAL VIEW

1. The Board has empowered the Director General, Chief Commissioners and Commissioners to issue orders in writing that the powers and functions of the Assessing Officer in respect of any specified area or persons or classes of persons or incomes or classes of income or cases or classes of cases shall be performed by a Deputy Commissioner. [Notification No. 7817, dated 30th March, 1988]

121. Jurisdiction of Commissioners:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. It was amended by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967.]

121A. Jurisdiction of Commissioners (Appeals):-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. It was inserted by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.]

122. Jurisdiction of Appellate Assistant Commissioners:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

123. Jurisdiction of Inspecting Assistant Commissioners:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. It was substituted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967.]

1[J39] [124. Jurisdiction of Assessing Officers:-

(1) Where by virtue of any direction or order issued under sub-section (1) or sub-section (2) of section 120, the Assessing Officer has been vested with jurisdiction over any area, within the limits of such area, he shall have jurisdiction—

(a) in respect of any person carrying on a business or profession, if the place at which he carries on his business or profession is situate within the area, or where his business or profession is carried on in more places than one, if the principal place of his business or profession is situate within the area, and

(b) In respect of any other person residing within the area.

(2) Where a question arises under this section as to whether an Assessing Officer has jurisdiction to assess any person, the question shall be determined by the Director General or the Chief Commissioner or the Commissioner; or where the question is one relating to areas within the jurisdiction of different Directors General or Chief Commissioners or Commissioners, by the Directors General or Chief Commissioners or Commissioners concerned or, if they are not in agreement, by the Board or by such Director General or Chief Commissioner or Commissioner as the Board may, by notification in the Official Gazette, specify.

(3) No person shall be entitled to call in question the jurisdiction of an Assessing Officer—

(a) where he has made a return 2[J40] [under sub-section (1) of section 115WD or] under sub-section (1) of section 139, after the expiry of one month from the date on which he was served with a notice under sub-section (1) of section 142 or 3[J41] [sub-section (2) of section 115WE or] sub-section (2) of section 143 or after the completion of the assessment, whichever is earlier;

(b) where he has made no such return, after the expiry of the time allowed by the notice under 4[J42] [sub-section (2) of section 115WD or sub-section (1) of section 142 or under sub-section (1) of section 115WH or under section 148 for the making of the return or by the notice under the first proviso to section 115WF or under the first proviso to section 144] to show cause why the assessment should not be completed to the best of the judgment of the Assessing Officer, whichever is earlier.

(4) Subject to the provisions of sub-section (3), where an assessee calls in question the jurisdiction of an Assessing Officer, then the Assessing Officer shall, if not satisfied with the correctness of the claim, refer the matter for determination under sub-section (2) before the assessment is made.

(5) Notwithstanding anything contained in this section or in any direction or order issued under section 120, every Assessing Officer shall have all the powers conferred by or under this Act on an Assessing Officer in respect of the income accruing or arising or received within the area, if any, over which he has been vested with jurisdiction by virtue of the directions or orders issued under sub-section (1) or sub-section (2) of section 120.]

1[J43] [125. Powers of Commissioner respecting specified areas, cases, persons, etc:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

125A. Concurrent jurisdiction of Inspecting Assistant Commissioner and Income-tax Officer:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. It was inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975 and amended by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.]

126. Powers of Board respecting specified area, classes of persons or incomes:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. It was amended by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978]

1[J44] [127. Power to transfer cases2[J45] :-

(1) The Director General or Chief Commissioner or Commissioner may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, transfer any case from one or more Assessing Officers subordinate to him (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) also subordinate to him.

(2) Where the Assessing Officer or Assessing Officers from whom the case is to be transferred and the Assessing Officer or Assessing Officers to whom the case is to be transferred are not subordinate to the same Director General or Chief Commissioner or Commissioner,—

(a) Where the Directors General or Chief Commissioners or Commissioners to whom such Assessing Officers are subordinate are in agreement, then the Director General or Chief Commissioner or Commissioner from whose jurisdiction the case is to be transferred may, after giving the assessed a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, pass the order;

(b) Where the Directors General or Chief Commissioners or Commissioners aforesaid are not in agreement, the order transferring the case may, similarly, be passed by the Board or any such Director General or Chief Commissioner or Commissioner as the Board may, by notification in the Official Gazette, authorise in this behalf.

(3) Nothing in sub-section (1) or sub-section (2) shall be deemed to require any such opportunity to be given where the transfer is from any Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) and the offices of all such officers are situated in the same city, locality or place.

(4) The transfer of a case under sub-section (1) or sub-section (2) may be made at any stage of the proceedings, and shall not render necessary the re-issue of any notice already issued by the Assessing Officer or Assessing Officers from whom the case is transferred.

Explanation.—In section 120 and this section, the word "case", in relation to any person whose name is specified in any order or direction issued there under, means all proceedings under this Act in respect of any year which may be pending on the date of such order or direction or which may have been completed on or before such date, and includes also all proceedings under this Act which may be commenced after the date of such order or direction in respect of any year.]

DEPARTMENTAL VIEW

1. The Board issued administrative instructions directing that there should be no routine transfer of cases during the period 1-7-1998 to 31-3-1999 to facilitate the process of computerization. It is clarified that these guidelines do not in any way curtail the statutory powers vested in the income-tax authorities by law. Exceptional cases of sensitive nature or those requiring the centralization and decentralizations on priority basis or where court's directions are to be complied with, the orders for change of jurisdiction may be passed only after obtaining the prior approved of Board. [Circular No. 770, dated 16-9-1998]

128. Functions of Inspectors of Income-tax:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. It was substituted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967.]

129. Change of incumbent of an office:-

Whenever in respect of any proceeding under this Act an income-tax authority ceases to exercise jurisdiction and is succeeded by another who has and exercises jurisdiction, the income-tax authority so succeeding may continue the proceeding from the stage at which the proceeding was left by his predecessor:

Provided that the assesses concerned may demand that before the proceeding is so continued the previous proceeding or any part thereof be reopened or that before any order of assessment is passed against him, he be reheard.

1[J46] [130. Commissioner competent to perform any function or functions:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

130A. Income-tax Officer competent to perform any function or functions:-

Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Original section was inserted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967 and amended by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.]

C.—Powers

131. Power regarding discovery, production of evidence, etc.1[J47] :-

(1) The 2[J48] [Assessing] Officer, 3[J49] [Deputy Commissioner (Appeals)], 4[J50] [5[J51] [Joint] Commissioner], 6[J52] [Commissioner (Appeals)] and 7[J53] [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;

(d) Issuing commissions.

8[J54] [(1A) 9[J55] [If the Director General or Director or 10[J56] [Joint] Director or Assistant Director 11[J57] [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, 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-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.

[(2) Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.]

(3) Subject to any rules made in this behalf, any authority referred to in sub-section (1) 12[J58] [or sub-section (1A)] may impound and retain in its custody for such period as it thinks fit any books of account or other documents produced before it in any proceeding under this Act:

Provided that an 13[J59] [Assessing] Officer 14[J60] [or an 15[J61] [Assistant Director]] 16[J62] [or Deputy Director] shall not—

(a) Impound any books of account or other documents without recording his reasons for so doing, or

(b) Retain in his custody any such books or documents for a period exceeding fifteen days (exclusive of holidays) without obtaining the approval of the 17[J63] [18[J64] [Chief Commissioner or Director General or Commissioner or Director there for, as the case may be.]]

1[J65] [132. Search and seizure2[J66] :-

3[J67] (1) Where the 4[J68] [Director General or Director] or the 5[J69] [Chief Commissioner or Commissioner] 6[J70] [or any such] 7[J71] [8[J72] [Joint] Director] or 9[J73] [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 summons under sub-section (1) of section 37 of the Indian Income-tax Act, 1922 (11 of 1922), or under sub-section (1) of section 131 of this Act, or a notice under sub-section (4) of section 22 of the Indian Income-tax Act, 1922 (11 of 1922), or under sub-section (1) of section 142 of this Act 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 summons or notice, or

(b) 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, any books of account or other documents which will be useful for, or relevant to, any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act, or

(c) any person is in possession of any money, bullion, jewellery or other valuable article or thing and such money, bullion, jewellery or other valuable article or thing represents either wholly or partly income or property 10[J74] [which has not been, or would not be disclosed] for the purposes of the Indian Income-tax Act, 1922 (11 of 1922) or this Act (hereinafter in this section referred to as the undisclosed income or property),

11[J75] [then,—

(A) The 12[J76] [Director General or Director] or the 13[J77] [Chief Commissioner or Commissioner], as the case may be, may authorise any 14[J78] [15[J79] [Joint] Director], 16[J80] [Joint] Commissioner, 17[J81] [Assistant Director] 18[J82] [or Deputy Director], 19[J83] [Assistant Commissioner 20[J84] [or Deputy Commissioner] or Income-tax Officer], or

(B) Such 21[J85] [22[J86] [Joint] Director] or 23[J87] [Joint] Commissioner, as the case may be, may authorise any 24[J88] [Assistant Director] 25[J89] [or Deputy Director], 26[J90] [Assistant Commissioner 27[J91] [or Deputy Commissioner] or Income-tax Officer],

(the officer so authorized in all cases being hereinafter referred to as the authorized officer) to—]

(i) enter and search any 28[J92] [building, place, vessel, vehicle or aircraft] where he has reason to suspect that such books of account, other documents, money, bullion, jewellery or other valuable article or thing are kept;

(ii) 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;

29[J93] [(iia) 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, other documents, money, bullion, jewellery or other valuable article or thing;]

30[J94] [(iib) require any person who is found to be in possession or control of any books of account or other documents maintained in the form of electronic record as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 200031[J95] (21 of 2000), to afford the authorised officer the necessary facility to inspect such books of account or other documents;]

(iii) Seize any such books of account, other documents, money, bullion, jewellery or other valuable article or thing found as a result of such search:

32[J96] [Provided that bullion, jewellery or other valuable article or thing, being stock-in-trade of the business, found as a result of such search shall not be seized but the authorized officer shall make a note or inventory of such stock-in-trade of the business;]

(iv) place marks of identification on any books of account or other documents or make or cause to be made extracts or copies there from;

(v) Make a note or an inventory of any such money, bullion, jewellery or other valuable article or thing:

33[J97] [Provided that where any building, place, vessel, vehicle or aircraft referred to in clause (i) is within the area of jurisdiction of any 34[J98] [Chief Commissioner or Commissioner], but such 35[J99] [Chief Commissioner or Commissioner] has no jurisdiction over the person referred to in clause (a) or clause (b) or clause (c), then, notwithstanding anything contained in section 36[J100] [120], 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 37[J101] [Chief Commissioner or Commissioner] having jurisdiction over such person may be prejudicial to the interests of the revenue:]

38[J102] [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 (iii):]

39[J103] [Provided also that nothing contained in the second proviso shall apply in case of any valuable article or thing, being stock-in-trade of the business.]

40[J104] [(1A) Where any 41[J105] [Chief Commissioner or Commissioner], in consequence of information in his possession, has reason to suspect that any books of account, other documents, money, bullion, jewellery or other valuable article or thing in respect of which an officer has been authorised by the 42[J106] [Director General or Director] or any other 43[J107] [Chief Commissioner or Commissioner] or any such 44[J108] [45[J109] [Joint] Director] or 46[J110] [Joint] Commissioner as may be empowered in this behalf by the Board to take action under clauses (i) to (v) of sub-section (1) are or is kept in any building, place, vessel, vehicle or aircraft not mentioned in the authorisation under sub-section (1), such 47[J111] [Chief Commissioner or Commissioner] may, notwithstanding anything contained in section 48[J112] [120], authorise the said officer to take action under any of the clauses aforesaid in respect of such building, place, vessel, vehicle or aircraft.]

(2) 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) 49[J113] [or sub-section (1A)] and it shall be the duty of every such officer to comply with such requisition.

(3) The authorised officer may, where it is not practicable to seize any such books of account, other documents, money, bullion, jewellery or other valuable article or thing, 50[J114] [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.

51[J115] [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 (iii) 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, documents, money, bullion, jewellery or other valuable article or thing and any statement made by such person during such examination may thereafter be used in evidence in any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act.

52[J116] [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 all matters relevant for the purposes of any investigation connected with any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act.]

53[J117] [(4A) Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing are or is found in the possession or control of any person in the course of a search, it may be presumed—

(i) that such books of account, other documents, money, bullion, jewellery or other valuable article or thing belong or belongs to such person;

(ii) That the contents of such books of account and other documents are true; and

(iii) That the signature and every other part of such books of account and 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.]

54[J118] [(5) to (7) Omitted by the Finance Act, 2002, w.e.f. 1-6-2002.]

(8) The books of account or other documents seized under sub-section (1) 55[J119] [or sub-section (1A)] shall not be retained by the authorised officer for a period exceeding 56[J120] [thirty days from the date of the order of assessment 57[J121] [under section 153A or clause (c) of section 158BC]] unless the reasons for retaining the same are recorded by him in writing and the approval of the 58[J122] [Chief Commissioner, Commissioner, Director General or Director] for such retention is obtained:

Provided that the 59[J123] [Chief Commissioner, Commissioner, Director General or Director] shall not authorise the retention of the books of account and other documents for a period exceeding thirty days after all the proceedings under the Indian Income-tax Act, 1922 (11 of 1922), or this Act in respect of the years for which the books of account or other documents are relevant are completed.

6[(8A) an order under sub-section (3) shall not be in force for a period exceeding sixty days from the date of the order.]60 [J124]

(9) The person from whose custody any books of account or other documents are seized under sub-section (1) 61[J125] [or sub-section (1A)] may make copies thereof, or take extracts there from, 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.

62[J126] [(9A) 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, or any money, bullion, jewellery or other valuable article or thing (hereafter in this section and in sections 132A and 132B referred to as assets) seized under that sub-section shall be handed over by the authorised officer to the Assessing Officer having jurisdiction over such person within a period of sixty days from the date on which the last of the authorisation for search was executed and thereupon the powers exercisable by the authorised officer under sub-section (8) or sub-section (9) shall be exercisable by such Assessing Officer.]

(10) If a person legally entitled to the books of account or other documents seized under sub-section (1) 63[J127] [or sub-section (1A)] objects for any reason to the approval given by the 64[J128] [Chief Commissioner, Commissioner, Director General or Director] under sub-section (8), 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 65[J129] [and the Board may, after giving the applicant an opportunity of being heard, pass such orders as it thinks fit].

66[J130] [(11), (11A) & (12) Omitted by the Finance Act, 2002, w.e.f. 1-6-2002.

67[J131] [(13) the provisions of the Code of Criminal Procedure, 1973 (2 of 1974), relating to searches and seizure shall apply, so far as may be, to searches and seizure under sub-section (1) or sub-section (1A).]

68[J132] (14) The Board may make rules in relation to any search or seizure under this section; 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 69[J133] [any building, place, vessel, vehicle or aircraft] to be searched where free ingress thereto is not available;

(ii) For ensuring safe custody of any books of account or other documents or assets seized.

70[J134] [Explanation 1.— for the purposes of sub-section (9A), "execution of an authorisation for search" shall have the same meaning as assigned to it in Explanation 2 to section 158BE.]

Explanation 2.—In this section, the word "proceeding" means any proceeding in respect of any year, whether under the Indian Income-tax Act, 1922 (11 of 1922), 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.]

DEPARTMENTAL VIEW/SUPREME COURT RULING

1. To ensure that information about lockers is available early the authorised officers should soon after entering the premises, record the parties' statement and get him/her committed about the number of lockers contents thereof and source of acquisition. The lockers would be opened as early as possible but in any case within a week. Where the lockers sealed cannot be opened within the specified period of seven days, the reasons for the delay should be intimated to the Director General. [Instruction No. 1497, dated 13th January, 1983]

2. The Income-tax Act imposes no limitation on the Assessing Officer and the authorised officer for a search being the same person and it cannot be said that action taken pursuant to such statutory empowerment was colored, only by reason thereof, by any bias. [Union of India v Vipan Kumar Jain (2003) 260 ITR 1 (SC)]

3. Section 132(4A) enables an assessing authority to raise a rebut table presumption that books of account, money, bullion, etc. found in the possession of any person during a search, belong to such person and that the contents of such books of account and other documents are true and that the signatures and every other part of such books of account and other documents are signed by such person or are in the handwriting of that particular person. The words used are "may be presumed". The presumption, therefore, is a rebut table presumption. However, the presumption will not be available for the purpose of framing a regular assessment. Being a complete code in itself, section 132 cannot intrude into any other provision of the Act. Similarly, other provisions of the Act cannot interfere with the scheme or other working of section 132 or its provisions. [Metrani (P R) v CIT (2006) 287 ITR 209 (SC)]

1[J135] [132A. Powers to requisition books of account, etc.2[J136] :-

(1) Where the 3[J137] [Director General or Director] or the 4[J138] [Chief Commissioner or Commissioner], in consequence of information in his possession, has reason to believe that—

(a) any person to whom a summons under sub-section (1) of section 37 of the Indian Income-tax Act, 1922 (11 of 1922), or under sub-section (1) of section 131 of this Act, or a notice under sub-section (4) of section 22 of the Indian Income-tax Act, 1922, or under sub-section (1) of section 142 of this Act 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 summons or notice and the said books of account or other documents have been taken into custody by any officer or authority under any other law for the time being in force, or

(b) any books of account or other documents will be useful for, or relevant to, any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under 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 on the return of such books of account or other documents by any officer or authority by whom or which such books of account or other documents have been taken into custody 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 Indian Income-tax Act, 1922 (11 of 1922), 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 5[J139] [Director General or Director] or the 6[J140] [Chief Commissioner or Commissioner] may authorise any 7[J141] [8[J142] [Joint] Director], 9[J143] [Joint] Commissioner, 10[J144] [Assistant Director] 11[J145] [or Deputy Director], 12[J146] [Assistant Commissioner 13[J147] [or Deputy Commissioner] or Income-tax Officer] (hereafter in this section and in sub-section (2) of section 278D referred to as the requisitioning officer) to require the officer or authority referred to in clause (a) or clause (b) or clause (c), as the case may be, to deliver such books of account, other documents or assets to the requisitioning officer.

(2) On a requisition being made under sub-section (1), the officer or authority referred to in clause (a) or clause (b) or clause (c), as the case may be, of that sub-section shall deliver the books of account, other documents or assets 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 books of account, other documents or assets have been delivered to the requisitioning officer, the provisions of sub-sections (4A) to (14) (both inclusive) of section 132 and section 132B shall, so far as may be, apply as if such books of account, other documents or assets had been seized under sub-section (1) of section 132 by the requisitioning officer from the custody of the person referred to in clause (a) or clause (b) or clause (c), as the case may be, of sub-section (1) of this section and as if for the words "the authorised officer" occurring in any of the aforesaid sub-sections (4A) to (14), the words "the requisitioning officer" were substituted.]

1[J148] [132B. Application of seized or requisitioned assets:-

(1) The assets seized under section 132 or requisitioned under section 132A may be dealt with in the following manner, namely:—

(i) the amount of any existing liability under this Act, the Wealth-tax Act, 1957 (27 of 1957), the Expenditure-tax Act, 1987 (35 of 1987), the Gift-tax Act, 1958 (18 of 1958) and the Interest-tax Act, 1974 (45 of 1974), and the amount of the liability determined on completion of the assessment 2[J149] [under section 153A and the assessment of the year relevant to the previous year in which search is initiated or requisition is made, or the amount of liability determined on completion of the assessment under Chapter XIV-B 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, may be recovered out of such assets:

3[J150] [Provided that where the person concerned makes an application to the Assessing Officer within thirty days from the end of the month in which the asset was seized, for release of asset and the nature and source of acquisition of any such asset is explained] to the satisfaction of the Assessing Officer, the amount of any existing liability referred to in this clause may be recovered out of such asset and the remaining portion, if any, of the asset may be released, with the prior approval of the Chief Commissioner or Commissioner, to the person from whose custody the assets were seized:

Provided further that such asset or any portion thereof as is referred to in the first proviso shall be released within a period of one hundred and twenty days from the date on which the last of the authorisation for search under section 132 or for requisition under section 132A, as the case may be, was executed;

(ii) if the assets 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 clause (i) and the assesses shall be discharged of such liability to the extent of the money so applied;

(iii) the assets other than money may also be applied for the discharge of any such liability referred to in clause (i) as remains undercharged and for this purpose such assets shall be deemed to be under distrait as if such distrait was effected by the Assessing Officer or, as the case may be, the Tax Recovery Officer under authorisation from the Chief Commissioner or Commissioner under sub-section (5) of section 226 and the Assessing Officer or, as the case may be, the Tax Recovery Officer may recover the amount of such liabilities by the sale of such assets and such sale shall be effected in the manner laid down in the Third Schedule.

(2) Nothing contained in sub-section (1) shall preclude the recovery of the amount of liabilities aforesaid by any other mode laid down in this Act.

4[J151] (3) any assets or proceeds thereof which remain after the liabilities referred to in clause (i) of sub-section (1) are discharged shall be forthwith made over or paid to the persons from whose custody the assets were seized.

5[J152] (4) (a) The Central Government shall pay simple interest at the rate of 6[J153] [one-half per cent for every month or part of a month] on the amount by which the aggregate amount of money seized under section 132 or requisitioned under section 132A, as reduced by the amount of money, if any, released under the first proviso to clause (i) of sub-section (1), and of the proceeds, if any, of the assets sold towards the discharge of the existing liability referred to in clause (i) of sub-section (1), exceeds the aggregate of the amount required to meet the liabilities referred to in clause (i) of sub-section (1) of this section.

(b) Such interest shall run from the date immediately following the expiry of the period of one hundred and twenty days from the date on which the last of the authorisation for search under section 132 or requisition under section 132A was executed to the date of completion of the assessment 7[J154] [under section 153A or] under Chapter XIV-B.

Explanation.—In this section,—

(i) "Block period" shall have the meaning assigned to it in clause (a) of section 158B;

(ii) "Execution of an authorisation for search or requisition" shall have the same meaning as assigned to it in Explanation 2 to section 158BE.]

133. Power to call for information1[J155] :-

The 2[J156] [Assessing] Officer, the 3[J157] [Deputy Commissioner (Appeals)], 4[J158] [the 5[J159] [Joint] Commissioner or the Commissioner (Appeals)] may, for the purposes of this Act,—

(1) Require any firm to furnish him with a return of the names and addresses of the partners of the firm and their respective shares;

(2) Require any Hindu undivided family to furnish him with a return of the names and addresses of the manager and the members of the family;

(3) Require any person whom he has reason to believe to be a trustee, guardian or agent, to furnish him with a return of the names of the persons for or of whom he is trustee, guardian or agent, and of their addresses;

(4) require any assesses to furnish a statement of the names and addresses of all persons to whom he has paid in any previous year rent, interest, commission, royalty or brokerage, or any annuity, not being any annuity taxable under the head "Salaries" amounting to more than 6[J160] [one thousand rupees, or such higher amount as may be prescribed], together with particulars of all such payments made;

(5) Require any dealer, broker or agent or any person concerned in the management of a stock or commodity exchange to furnish a statement of the names and addresses of all persons to whom he or the exchange has paid any sum in connection with the transfer, whether by way of sale, exchange or otherwise, of assets, or on whose behalf or from whom he or the exchange has received any such sum, together with particulars of all such payments and receipts;

(6) Require any person, including a banking company or any officer thereof, to furnish information in relation to such points or matters, or to furnish statements of accounts and affairs verified in the manner specified by the 7[J161] [Assessing] Officer, the 8[J162] [Deputy Commissioner (Appeals)] 9[J163] [the 10[J164] [Joint] Commissioner or the Commissioner (Appeals)], giving information in relation to such points or matters as, in the opinion of the 11[J165] [Assessing] Officer, the 12[J166] [Deputy Commissioner (Appeals)] 13[J167] [, the 14[J168] [Joint] Commissioner or the Commissioner (Appeals)] will be useful for, or relevant to, any 15[J169] [inquiry or] proceeding under this Act:

16[J170] [Provided that the powers referred to in clause (6), may also be exercised by the Director-General, the Chief Commissioner, the Director and the Commissioner:]

17[J171] [Provided further that the power in respect of an inquiry, in a case where no proceeding is pending, shall not be exercised by any income-tax authority below the rank of Director or Commissioner without the prior approval of the Director or, as the case may be, the Commissioner.]

SUPREME COURT RULING

1. It is not necessary that any inquiry should have commenced with the issuance of notice or otherwise before section 133(6) can be invoked calling for information in relation to useful or relevant points or matters. The second proviso to section 133(6) makes it clear that such information can be sought for even when no proceeding under the Act is pending, the only safeguard being that before this power can be invoked the approval of the Director or the Commissioner, as the case may be, has to be obtained. [Karnataka Bank Ltd. v Secretary, Govt. of India (2002) 255 ITR 508 (SC)]

1[J172] [133A. Power of survey2[J173] :-

(1) Notwithstanding anything contained in any other provision of this Act, an income-tax authority may enter—

(a) Any place within the limits of the area assigned to him, or

(b) Any place occupied by any person in respect of whom he exercises jurisdiction, 3[J174] [or]

4[J175] [(c) any place in respect of which he is authorised for the purposes of this section by such income-tax authority, who is assigned the area within which such place is situated or who exercises jurisdiction in respect of any person occupying such place,] at which a business or profession is carried on, whether such place be the principal place or not of such business or profession, and require any proprietor, employee or any other person who may at that time and place be attending in any manner to, or helping in, the carrying on of such business or profession—

(i) To afford him the necessary facility to inspect such books of account or other documents as he may require and which may be available at such place,

(ii) To afford him the necessary facility to check or verify the cash, stock or other valuable article or thing which may be found therein, and

(iii) To furnish such information as he may require as to any matter which may be useful for, or relevant to, any proceeding under this Act.

Explanation.—For the purposes of this sub-section, a place where a business or profession is carried on shall also include any other place, whether any business or profession is carried on therein or not, in which the person carrying on the business or profession states that any of his books of account or other documents or any part of his cash or stock or other valuable article or thing relating to his business or profession are or is kept.

(2) An income-tax authority may enter any place of business or profession referred to in sub-section (1) only during the hours at which such place is open for the conduct of business or profession and, in the case of any other place, only after sunrise and before sunset.

(3) An income-tax authority acting under this section may,—

(i) if he so deems necessary, place marks of identification on the books of account or other documents inspected by him and make or cause to be made extracts or copies there from,

5[J176] [(ia) impound and retain in his custody for such period as he thinks fit any books of account or other documents inspected by him:

Provided that such income-tax authority shall not—

(a) Impound any books of account or other documents except after recording his reasons for so doing; or

4[(b) Retain in his custody any such books of account or other documents for a period exceeding ten days (exclusive of6[J177] holidays) without obtaining the approval of the Chief Commissioner or Director General there for, as the case may be,]

(ii) Make an inventory of any cash, stock or other valuable article or thing checked or verified by him,

(iii) Record the statement of any person which may be useful for, or relevant to, any proceeding under this Act.

(4) An income-tax authority acting under this section shall, on no account, remove or cause to be removed from the place wherein he has entered, 7[J178] [* * *] any cash, stock or other valuable article or thing.

(5) Where, having regard to the nature and scale of expenditure incurred by an assessee, in connection with any function, ceremony or event, the income-tax authority is of the opinion that it is necessary or expedient so to do, he may, at any time after such function, ceremony or event, require the assesses by whom such expenditure has been incurred or any person who, in the opinion of the income-tax authority, is likely to possess information as respects the expenditure incurred, to furnish such information as he may require as to any matter which may be useful for, or relevant to, any proceeding under this Act and may have the statements of the assesses or any other person recorded and any statement so recorded may thereafter be used in evidence in any proceeding under this Act.

(6) If a person under this section is required to afford facility to the income-tax authority to inspect books of account or other documents or to check or verify any cash, stock or other valuable article or thing or to furnish any information or to have his statement recorded either refuses or evades to do so, the income-tax authority shall have all the powers under 8[J179] [sub-section (1) of section 131] for enforcing compliance with the requirement made:

9[J180] [Provided that no action under sub-section (1) shall be taken by an Assistant Director or a Deputy Director or an Assessing Officer or a Tax Recovery Officer or an Inspector of Income-tax without obtaining the approval of the Joint Director or the Joint Commissioner, as the case may be.]

Explanation.—In this section,—

10[J181] [(a) "Income-tax authority" means a Commissioner, a Joint Commissioner, a Director, a Joint Director, an Assistant Director or a Deputy Director or an Assessing Officer, or a Tax Recovery Officer, and for the purposes of clause (i) of sub-section (1), clause (i) of sub-section (3) and sub-section (5), includes an Inspector of Income-tax;]

(b) "proceeding" means any proceeding under this Act in respect of any year which may be pending on the date on which the powers under this section are exercised 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.]

DEPARTMENTAL VIEW

1. The place where entry can be made under this section must not be a place where the assessee does not carry on business. Business on residential premises of third parties including a chartered accountant, a pleader or income-tax practitioner of whom the assessee may be a client are not places which could be entered into for the purpose of section 133A. [Circular No. 7D, dated 3rd May, 1967]

1[J182] [133B. Power to collect certain information2[J183] :-

(1) Notwithstanding anything contained in any other provision of this Act, an income-tax authority may, for the purpose of collecting any information which may be useful for, or relevant to the purposes of this Act, enter—

(a) Any building or place within the limits of the area assigned to such authority; or

(b) Any building or place occupied by any person in respect of whom he exercises jurisdiction, at which a business or profession is carried on, whether such place be the principal place or not of such business or profession, and require any proprietor, employee or any other person who may at that time and place be attending in any manner to, or helping in, the carrying on of such business or profession to furnish such information as may be prescribed.

(2) An income-tax authority may enter any place of business or profession referred to in sub-section (1) only during the hours at which such place is open for the conduct of business or profession.

(3) For the removal of doubts, it is hereby declared that an income-tax authority acting under this section shall, on no account, remove or cause to be removed from the building or place wherein he has entered, any books of account or other documents or any cash, stock or other valuable article or thing.

Explanation.—In this section, "income-tax authority" means a 3[J184] [Joint] Commissioner, an 4[J185] [Assistant Director] 5[J186] [or Deputy Director] or an 6[J187] [Assessing] Officer, and includes an Inspector of Income-tax who has been authorised by the 7[J188] [Assessing] Officer to exercise the powers conferred under this section in relation to the area in respect of which the 8[J189] [Assessing] Officer exercises jurisdiction or part thereof.];

134. Power to inspect registers of companies:-

The 1[J190] [Assessing] Officer, the 2[J191] [Deputy Commissioner (Appeals)], 3[J192] [the 4[J193] [Joint] Commissioner or the Commissioner (Appeals)], or any person subordinate to him authorised in writing in this behalf by the 5[J194] [Assessing] Officer, the 6[J195] [Deputy Commissioner (Appeals)], 7[J196] [the 8[J197] [Joint] Commissioner or the Commissioner (Appeals)], may inspect, and if necessary, take copies, or cause copies to be taken, of any register of the members, debenture holders or mortgagees of any company or of any entry in such register.

135. Power of 1[J198] [Director General or Director], 2[J199] [Chief Commissioner or Commissioner] and 3[J200] [Joint] Commissioner:-

The 4[J201] [Director General or Director], the 5[J202] [Chief Commissioner or Commissioner] and the 6[J203] [Joint] Commissioner shall be competent to make any enquiry under this Act, and for this purpose shall have all the powers that an 7[J204] [Assessing] Officer has under this Act in relation to the making of enquiries.

136. Proceedings before income-tax authorities to be judicial proceedings:-

Any proceeding under this Act before an income-tax authority shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purposes of section 196 of the Indian Penal Code, 18601[J205] (45 of 1860) 2[J206] [and every income-tax authority shall be deemed to be a Civil Court for the purposes of section 195, but not for the purposes of Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974)].

D.—Disclosure of information

137. Disclosure of information prohibited:-

Omitted by the Finance Act, 1964, w.e.f. 1-4-1964.]

1[J207] [138. Disclosure of information respecting assessee:-

2[J208] [(1)(a) The Board or any other income-tax authority specified by it by a general or special order3[J209] in this behalf may furnish or cause to be furnished to—

(i) any officer, authority or body performing any functions under any law relating to the imposition of any tax, duty or Cess, or to dealings in foreign exchange as defined in section 2(d) of the Foreign Exchange Regulation Act, 19474 [J210] (7 of 1947); or

(ii) such officer, authority or body performing functions under any other law as the Central Government may, if in its opinion it is necessary so to do in the public interest, specify by notification5[J211] in the Official Gazette in this behalf, any such information 6[J212] [received or obtained by any income-tax authority in the performance of his functions under this Act], as may, in the opinion of the Board or other income-tax authority, be necessary for the purpose of enabling the officer, authority or body to perform his or its functions under that law.

7[J213] (b) Where a person makes an application to the 8[J214] [Chief Commissioner or Commissioner] in the prescribed form for any information relating to any assessee 9[J215] [received or obtained by any income-tax authority in the performance of his functions under this Act], the 10[J216] [Chief Commissioner or Commissioner] may, if he is satisfied that it is in the public interest so to do, furnish or cause to be furnished the information asked for 11[J217] [* * *] and his decision in this behalf shall be final and shall not be called in question in any court of law.]

12[J218] (2) Notwithstanding anything contained in sub-section (1) or any other law for the time being in force, the Central Government may, having regard to the practices and usages customary or any other relevant factors, by order notified in the Official Gazette, direct that no information or document shall be furnished or produced by a public servant in respect of such matters relating to such class of assessee or except to such authorities as may be specified in the order.]

[J1]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Prior to the substitution, section 116 was amended by the Central Boards of Revenue Act, 1963, w.e.f. 1-1-1964; the Finance Act, 1970, w.e.f. 1-4-1970 and the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J2]

[J3]Inserted by the Finance Act, 1994, w.e.f. 1-6-1994.

[J4]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J5]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Prior to the substitution, section 117 was amended by the Finance Act, 1970, w.e.f. 1-4-1970 and the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J6]See Notification No. SO 3464, dated 6-12-1990.

[J7]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J8]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J9]See Notification No. SO 359(E), dated 30-3-1988 as corrected by Notification No. 10028, dated 21-3-1996; Notification No. SO 279(E), dated 12-3-2003, and amended by Notification No. SO 626(E), dated 18-5-2004 and Notification No. 260/2005, dated 15-12-2005.

[J10]Substituted by the Taxation Laws (Amendment) Act, 1970, w.e.f. 1-4-1971.

[J11]The words "Deputy Commissioner (Appeals) or the" omitted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. The words "Deputy Commissioner (Appeals)" were substituted for "Appellate Assistant Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. The words "or the Commissioner (Appeals)" were inserted by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J12]Inserted by the Finance (No. 2) Act, 1977, w.e.f 10-7-1978.

[J13]See rule 111B.

[J14]Inserted by the Finance (No. 2) Act, 2004, w.e.f. 1-10-2004.

[J15]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.

[J16]Inserted by the Finance Act, 1990, w.e.f. 1-4-1990.

[J17]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.

[J18]Substituted for "210, 234A, 234B" by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1991. Earlier, the figures "234A, 234B" were inserted by the Finance Act, 1990, w.e.f. 1-4-1990.

[J19]Inserted by the Finance Act, 1990, w.e.f. 1-4-1990.

[J20]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.

[J21]Substituted for "the Commissioner or the Income-tax Officer" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f 1-4-1988.

[J22]The words "Deputy Commissioner (Appeals) or" omitted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J23]Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-10-1991.

[J24]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J25]Inserted by the Finance Act, 2006, w.r.e.f. 1-4-1988.

[J26]See Notification No. 259/2001, dated 7-9-2001.

[J27]Inserted by the Finance Act, 2007, w.r.e.f. 1-6-1994.

[J28]Inserted by the Finance Act, 2007, w.r.e.f. 1-10-1996.

[J29]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J30]Inserted by the Finance (No. 2) Act, 1996, w.e.f. 1-10-1996.

[J31]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J32]Inserted by the Finance Act, 2007, w.r.e.f. 1-6-1994.

[J33]Inserted by the Finance Act, 2007, w.r.e.f. 1-10-1996.

[J34]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J35]Inserted by the Finance (No. 2) Act, 1996, w.e.f. 1-10-1996.

[J36]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J37]Ibid.

[J38]See Notification No. 19/2001, dated 18-1-2001.

[J39]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Prior to the substitution, section 124 was amended by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967 and the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J40]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.

[J41]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.

[J42]Substituted for "sub-section (1) of section 142 or under section 148 for the making of the return or by the notice under the first proviso to section 144" by the Finance Act, 2005, w.e.f. 1-4-2006.

[J43]Prior to the omission, section 125 was substituted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967 and amended by the Finance Act, 1972, w.e.f. 1-4-1972; the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975 and the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J44]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Prior to the substitution, sub-section (1) of section 127 was substituted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967 and again by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J45]See Board's Letter F. No. 64/163/66-IT (Inv), dated 29-5-1967.

[J46]Prior to the omission, section 130 was substituted by the Finance Act, 1970, w.e.f. 1-4-1970 and amended by the Taxation Laws Amendment) Act, 1984, w.e.f 1-10-1984.

[J47]See Circular No. 8(LXXVI-22) D, dated 13-5-1958.

[J48]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J49]Substituted for "Appellate Assistant Commissioner", ibid.

[J50]Substituted for "Inspecting Assistant Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J51]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J52]Inserted by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J53]Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J54]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J55]Substituted for "If the Assistant Director of Inspection" by the Finance Act, 1988, w.e.f. 1-6-1988.

[J56]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J57]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J58]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J59]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J60]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J61]Substituted for "Assistant Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J62]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J63]Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J64]Substituted for "Chief Commissioner or Commissioner there for" by the Finance Act, 1988, w.e.f. 1-6-1988.

[J65]Substituted by the Income-tax (Amendment) Act, 1965, w.e.f. 12-3-1965. The Amendment Act also provided for a validating provision (section 6) for pre-1965 searches. Earlier, section 132 was substituted by the Finance Act, 1964, w.e.f. 1-4-1964.

[J66]See Instruction No. 1497, dated 13-1-1983.

[J67]See rule 112(2)(a) and Form No. 45.

[J68]Substituted for "Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J69]Substituted for "Commissioner", ibid.

[J70]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J71]Substituted for "Deputy Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J72]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J73]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier, substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J74]Substituted for "which has not been disclosed" by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J75]Substituted for "he may authorise any Deputy Director of Inspection, Inspecting Assistant Commissioner, Assistant Director of Inspection or Income-tax Officer (hereinafter referred to as the authorised officer) to—" by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J76]Substituted for "Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J77]Substituted for "Commissioner", ibid.

[J78]Substituted for "Deputy Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J79]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J80]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J81]Substituted for "Assistant Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J82]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J83]Substituted for "or Income-tax Officer" by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988), w.e.f. 1-4-1988.

[J84]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J85]Substituted for "Deputy Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988), w.e.f. 1-4-1988.

[J86]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J87]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J88]Substituted for "Assistant Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988), w.e.f. 1-4-1988.

[J89]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J90]Substituted for "or Income-tax Officer" by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988), w.e.f. 1-4-1988.

[J91]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J92]Substituted for "building or place" by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J93]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J94]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.

[J95]

[J96]Inserted by the Finance Act, 2003, w.e.f. 1-6-2003.

[J97]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975. See rule 112(2)(b) and Form No. 45A.

[J98]Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J99]Ibid.

[J100]Substituted for "121" by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988) w.e.f. 1-4-1988.

[J101]Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J102]Inserted by the Finance Act, 1988, w.e.f. 1-4-1989.

[J103]Inserted by the Finance Act, 2003, w.e.f. 1-6-2003.

[J104]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975. See rule 112(2)(c) and Form No. 45B.

[J105]Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J106]Substituted for "Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J107]Substituted for "Commissioner", ibid.

[J108]Substituted for "Deputy Director of Inspection", ibid.

[J109]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J110]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J111]Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J112]Substituted for "121" by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988), w.e.f. 1-4-1988.

[J113]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J114]Inserted by the Finance Act, 1988, w.e.f. 1-4-1989.

[J115]Inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[J116]Inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[J117]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975. See rule 112(2)(c) and Form No. 45B.

[J118]Prior to the omission, sub-sections (5) to (7), as amended from time to time, read as under:

"(5) 1[Where any money, bullion, jewellery or other valuable article or thing (hereafter in this section and in sections 132A and 132B referred to as the assets) is seized under sub-section (1) or sub-section (1A), 2[as a result of a search initiated or requisition made before the 1st day of July, 1995] the 3[Assessing] Officer, after affording a reasonable opportunity to the person concerned of being heard and making such enquiry as may be prescribed,4 shall within 5[one hundred and twenty] days of the seizure, make an order, with the previous approval of the 6[Joint] Commissioner,—]

(i) estimating the undisclosed income (including the income from the undisclosed property) 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 income so estimated in accordance with the provisions of the Indian Income-tax Act, 1922 (11 of 1922), or this Act;

7[(iia) determining the amount of interest payable and the amount of penalty imposable in accordance with the provisions of the Indian Income-tax Act, 1922 (11 of 1922), or this Act, as if the order had been the order of regular assessment;]

(iii) specifying the amount that will be required to satisfy any existing liability under this Act and any one or more of the Acts specified in clause (a) of sub-section (1) of section 230A 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 to in clauses (ii), 8[(iia)] and (iii) and forthwith release the remaining portion, if any, of the assets to the person from whose custody they were seized:

Provided that if, after taking into account the materials available with him, the 9[Assessing] Officer is of the view that it is not possible to ascertain to which particular previous year or years such income or any part thereof relates, he may calculate the tax on such income or part, as the case may be, as if such income or part were the total income chargeable to tax at the rates in force in the financial year in which the assets were seized 10[and may also determine the interest or penalty, if any, payable or imposable accordingly]:

Provided further that where a person has paid or made satisfactory arrangements for payment of all the amounts referred to in clauses (ii), 11[(iia)] and (iii) or any part thereof, the 12[Assessing] Officer may, with the previous approval of the 13[Chief Commissioner or Commissioner], release the assets or such part thereof as he may deem fit in the circumstances of the case.

(6) The assets retained under sub-section (5) may be dealt with in accordance with the provisions of 14[section 132B].

(7) If the 15[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 16[Assessing] Officer may proceed under sub-section (5) against such other person and all the provisions of this section shall apply accordingly."

1 Substituted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

2 Inserted by the Finance Act, 1995, w.e.f. 1-7-1995.

3 Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

4 See rules 112A and 112B.

5 Substituted for "ninety" by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984.

6 Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

7 Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

8 Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

9 Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

10 Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

11 Ibid.

12 Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

13 Substituted for "Commissioner", ibid.

14 Substituted for "section 132A" by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

15 Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

16 Ibid.

[J119]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J120]Substituted for "one hundred and eighty days from the date of the seizure" by the Finance Act, 2002, w.e.f. 1-6-2002.

[J121]Substituted for "under clause (c) of section 158BC" by the Finance Act, 2003, w.e.f. 1-6-2003.

[J122]Substituted for "Chief Commissioner or Commissioner" by the Finance Act, 1997, w.r.e.f. 1-10-1996. Earlier, these words were substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J123]Ibid.

[J124]Substituted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to the substitution, sub-section (8A), as inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989, as amended, read as under:

"(8A) An order under sub-section (3) 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 by him in writing, extends the period of operation of the order beyond sixty days, after obtaining the approval of the 1[Director or, as the case may be, Commissioner] for such extension:

Provided that the 1[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 all 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."

1 Substituted for "Commissioner" by the Finance (No. 2) Act, 1991, w.e.f. 1-10-1991.

[J125]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J126]Substituted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to the substitution, sub-section (9A), as inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975, as amended, read as under:

(9A) 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 or assets seized under that sub-section shall be handed over by the authorised officer to the 1[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 (8) or sub-section (9) shall be exercisable by such 1[Assessing] Officer."

1 Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J127]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J128]Substituted for "Chief Commissioner or Commissioner" by the Finance Act, 1997, w.r.e.f. 1-10-1996. Earlier, these words were substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J129]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.

[J130]Prior to the omission, sub-sections (11), (11A) and (12), as originally enacted, and amended from time to time, read as under:

"(11) If any person objects for any reason to an order made under sub-section (5), he may, within thirty days of the date of such order, make an application to 1[the 2[Chief Commissioner or Commissioner]], stating therein the reasons for such objection and requesting for appropriate relief in the matter.

3[(11A) Every application referred to in sub-section (11) which is pending immediately before the 1st day of October, 1984, before an authority notified under that sub-section as it stood immediately before that day shall stand transferred on that day to the 4[Chief Commissioner or Commissioner], and the 5[Chief Commissioner or Commissioner] may proceed with such application from the stage at which it was on that day:

Provided that the applicant may demand that before proceeding further with the application, he be reheard.]

(12) On receipt of the application under sub-section (10) the Board, or on receipt of the application under sub-section (11) 6[the 7[Chief Commissioner or Commissioner]], may, after giving the applicant an opportunity of being heard, pass such orders as it 8[or he] thinks fit."

1 Substituted for "such authority, as may be notified in this behalf by the Central Government in the Official Gazette hereafter in this section referred to as the notified authority" by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984.

2 Substituted for "Chief Commissioner or Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

3 Inserted by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984.

4 Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

5 Ibid.

6 Substituted for "the notified authority" by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984.

7 Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

8 Inserted by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984.

[J131]Substituted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J132]See rules 112, 112A and 112B.

[J133]Substituted for "such building or place" by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J134]Substituted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to the substitution, Explanation 1 read as under:

"Explanation 1.—In computing 1[the period referred to in sub-section (5) 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."

1 Substituted for "the period of one hundred and twenty days for the purposes of sub-section (5)" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989. Earlier, the italicized words were substituted for "ninety" by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984.

[J135]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[J136]See rule 112D and Form No. 45C.

[J137]Substituted for "Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J138]Substituted for "Commissioner", ibid.

[J139]Substituted for "Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[J140]Substituted for "Commissioner", ibid.

[J141]Substituted for "Deputy Director of Inspection", ibid.

[J142]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J143]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J144]Substituted for "Assistant Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J145]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J146]Substituted for "or Income-tax Officer" by the Direct Tax Laws (Amendment) Act, 1987, (as amended by the Finance Act, 1988) w.e.f. 1-4-1988.

[J147]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J148]Substituted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to the substitution, section 132B, as inserted [as section 132A and later renumbered] by the Income-tax (Amendment) Act, 1965, w.e.f. 12-3-1965 and amended from time to time, read as under:

"1[132B]. Application of retained assets.—(1) The assets retained under sub-section (5) of section 132 may be dealt with in the following manner, namely:—

(i) The amount of the existing liability referred to in clause (iii) of the said sub-section and the amount of the liability determined on completion of the regular assessment or reassessment for all the assessment years relevant to the previous years to which the income referred to in clause (i) of that sub-section relates 2[(including any penalty levied or interest payable in connection with such assessment or reassessment)] and in respect of which he is in default or is deemed to be in default may be recovered out of such assets.

(ii) If the assets consist solely of money, or partly of money and partly of other assets, the 3[Assessing] Officer may apply such money in the discharge of the liabilities referred to in clause (i) and the assesses shall be discharged of such liability to the extent of the money so applied.

(iii) The assets other than money may also be applied for the discharge of any such liability referred to in clause (i) as remains undercharged and for this purpose such assets shall be deemed to be under distrait as if such distrait was effected by 4[the Assessing Officer or, as the case may be, Tax Recovery Officer] under authorisation from the 5[Chief Commissioner or Commissioner] under sub-section (5) of section 226 and 6[the Assessing Officer or, as the case may be, Tax Recovery Officer] may recover the amount of such liabilities by the sale of such assets and such sale shall be effected in the manner laid down in the Third Schedule.

(2) Nothing contained in sub-section (1) shall preclude the recovery of the amount of liabilities aforesaid by any other mode laid down in this Act.

(3) Any assets or proceeds thereof which remain after the liabilities referred to in clause (i) of sub-section (1) are discharged shall be forthwith made over or paid to the persons from whose custody the assets were seized.

7(4) (a) The Central Government shall pay simple interest at the rate of 8[fifteen] per cent per annum on the amount by which the aggregate of money retained under section 132 and of the proceeds, if any, of the assets sold towards the discharge of the existing liability referred to in clause (iii) of sub-section (5) of that section exceeds the aggregate of the amounts required to meet the liabilities referred to in clause (i) of sub-section (1) of this section.

(b) Such interest shall run from the date immediately following the expiry of the period of six months from the date of the order under sub-section (5) of section 132 to the date of the regular assessment or reassessment referred to in clause (i) of sub-section (1) or, as the case may be, to the date of last of such assessments or reassessments."

1 Renumbered for "132A" by the Taxation Laws (Amendment) Act, 1975 w.e.f. 1-10-1975.

2 Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

3 Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

4 Substituted for "the Income-tax Officer" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

5 Substituted for "Commissioner", ibid, w.e.f. 1-4-1988.

6 Substituted for "the Income-tax Officer", ibid, w.e.f. 1-4-1989.

7 See rule 119A.

8 Substituted for "twelve" by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984. Section 84 of the Amendment Act has clarified that the increase in the rate of interest will apply in respect of any period falling after 30-9-1984, also in those cases where the interest became chargeable or payable from an earlier date. Earlier, "twelve" was substituted for "nine" by the Finance Act, 1972, w.e.f. 1-4-1972 which was substituted for "six" by the Taxation Laws (Amendment) Act, 1967, w.e.f. 1-10-1967."

[J149]Substituted for "under Chapter XIVB for the block period" by the Finance Act, 2003, w.e.f. 1-6-2003.

[J150]Substituted for "Provided that where the nature and source of acquisition of any such asset is explained" by the Finance Act, 2003, w.e.f. 1-6-2003.

[J151]See rule 112C.

[J152]See rule 119A.

[J153]Substituted for "six per cent per annum" by the Finance Act, 2007, w.e.f. 1-4-2008. Earlier, the words "six per cent per annum" were substituted for "eight per cent per annum" by the Taxation Laws (Amendment) Act, 2003, w.e.f. 8-9-2003.

[J154]Inserted by the Finance Act, 2003, w.e.f. 1-6-2003.

[J155]See Circular No. 223, dated 15-6-1977.

[J156]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J157]Substituted for "Appellate Assistant Commissioner", ibid.

[J158]Substituted for "or the Inspecting Assistant Commissioner" by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J159]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J160]Substituted for "four hundred rupees" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[J161]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J162]Substituted for "Appellate Assistant Commissioner", ibid.

[J163]Substituted for "or the Inspecting Assistant Commissioner" by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J164]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J165]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J166]Substituted for "Appellate Assistant Commissioner", ibid.

[J167]Substituted for "or the Inspecting Assistant Commissioner" by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J168]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J169]Inserted by the Finance Act, 1995, w.e.f. 1-7-1995.

[J170]Inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[J171]Inserted by the Finance Act, 1995, w.e.f. 1-7-1995.

[J172]Substituted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975. It was originally inserted by the Finance Act, 1964, w.e.f. 1-4-1964.

[J173]See Circular No. 7-D(LXIII-7), dated 3-5-1967.

[J174]Inserted by the Finance Act, 1995, w.e.f. 1-7-1995.

[J175]Ibid.

[J176]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.

[J177]Substituted by the Finance Act, 2003, w.e.f. 1-6-2003. Prior to the substitution, clause (b), as inserted by the Finance Act, 2002, w.e.f. 1-6-2002, read as under:

"(b) retain in his custody any such books of account or other documents for a period exceeding fifteen days (exclusive of holidays) without obtaining the approval of the Chief Commissioner or Director General or Commissioner or Director there for, as the case may be;"

[J178]The words "any books of account or other documents or" omitted by the Finance Act, 2002, w.e.f. 1-6-2002.

[J179]Substituted for "sub-sections (1) and (2) of section 131" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[J180]Inserted by the Finance Act, 2003, w.e.f. 1-6-2003.

[J181]Substituted by the Finance Act, 2003, w.e.f. 1-6-2003. Prior to the substitution, clause (a) read as under:

"(a) "income-tax authority" means a 1[Commissioner, a 2[Joint] Commissioner, a Director, a 3[Joint] Director], an 4[Assistant Director] 5[or Deputy Director] or an 6[Assessing] Officer, and for the purposes of clause (i) of sub-section (1), clause (i) of sub-section (3) and sub-section (5), includes an Inspector of Income-tax, 7[if so authorised by any such authority];"

1 Substituted for "Deputy Commissioner" by the Finance Act, 1995, w.e.f. 1-7-1995. Earlier, the italicised word was substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

2 Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

3 Ibid.

4 Substituted for "Assistant Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

5 Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

6 Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

7 Substituted for "if so authorised by the Income-tax Officer", ibid, w.e.f. 1-4-1989.

[J182]Inserted by the Finance Act, 1986, w.e.f. 13-5-1986.

[J183]See rule 112E and Form No. 45D.

[J184]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J185]Substituted for "Assistant Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J186]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[J187]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J188]Ibid.

[J189]Ibid

[J190]Ibid.

[J191]Substituted for "Appellate Assistant Commissioner", ibid

[J192]Substituted for "or the Inspecting Assistant Commissioner" by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J193]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J194]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J195]Substituted for "Appellate Assistant Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J196]Substituted for "or the Inspecting Assistant Commissioner" by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[J197]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J198]Substituted for "Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J199]Substituted for "Commissioner", ibid.

[J200]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J201]Substituted for "Director of Inspection" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J202]Substituted for "Commissioner", ibid.

[J203]Substituted for "Deputy" by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, which was earlier substituted for "Inspecting Assistant" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J204]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J205]

[J206]Inserted by the Finance Act, 1985, w.r.e.f. 1-4-1974.

[J207]Substituted by the Finance Act, 1964, w.e.f. 1-4-1964.

[J208]Substituted by the Finance (No. 2) Act, 1967 w.e.f. 1-4-1967.

[J209]See Board's order F. No. 1027, dated 8-8-1975.

[J210]Now see section 2(m), Foreign Exchange Management Act, 1999.

[J211]

[J212]Substituted for "relating to any assessee in respect of any assessment made under this Act or the Indian Income-tax Act, 1922 (11 of 1922)" by the Direct Tax Laws (Amendment) Act , 1987, w.e.f. 1-4-1989.

[J213]See rule 113(1) and Form Nos. 46 to 49.

[J214]Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J215]Substituted for "in respect of any assessment made under this Act or the Indian Income-tax Act, 1922 (11 of 1922), on or after the 1st day of April, 1960", ibid, w.e.f. 1-4-1989.

[J216]Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[J217]The words "in respect of that assessment only" omitted, ibid.

[J218]See Notification No. SO 2048, dated 23-6-1965.