CHAPTER XIII

INCOME-TAX AUTHORITIES

A.—Appointment and control

⁹⁵[R1] [Income-tax authorities.

116. 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, 1963 (54 of 1963),

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

(c) Directors of Income-tax or Commissioners of Income-tax or Commissioners of Income-tax (Appeals),

⁹⁶[R2] [(cc) Additional Directors of Income-tax or Additional Commissioners of Income-tax or Additional Commissioners of Income-tax (Appeals),]

⁹⁷[R3] [(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.]

⁹⁸[R4] [Appointment of income-tax authorities.

117. (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 Commissioner ⁹⁹[R5] [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[R6] [Control of income-tax authorities.

118. 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.]

²[R7] [Instructions to subordinate authorities.

³[R8] 119. (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 ⁴[R9] [* * *] ⁵[R10] [Commissioner (Appeals)] in the exercise of his appellate functions.

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

⁶[R11] (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 ⁷[R12] [139,] 143, 144, 147, 148, 154, 155 ⁸[R13] [, 158BFA], ⁹[R14] [sub-section (1A) of section 201, sections 210, 211, 234A, 234B, 234C], 271 and 273 or otherwise), general or special orders in respect of any class of incomes 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 order¹⁰[R15] 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 order¹¹[R16] , authorise ¹²[R17] [any income-tax authority, not being a ¹³[R18] [***] 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[R19] [(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 -A, where the assessee has failed to comply with any requirement specified in such provision for claiming deduction thereunder, 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) ¹⁵[R20] [***]

B.—Jurisdiction

¹⁶[R21] [Jurisdiction of income-tax authorities.

¹⁷[R22] 120.(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) 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;

(c) incomes or classes of income; and

(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, 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 a ¹⁸[R23] [Joint] Commissioner ¹⁹[R24] [or a ¹⁸[R25] [Joint] Director], and, where any order is made under this clause, references in any other provision of this Act, or in any rule made thereunder to the Assessing Officer shall be deemed to be references to such ¹⁸[R26] [Joint] Commissioner ¹⁹[R27] [or ¹⁸[R28] [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 ¹⁸[R29] [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 thereunder 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 notification 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 thereunder 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.]

Jurisdiction of Commissioners.

²⁰[R30] 121. [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

Jurisdiction of Commissioners (Appeals).

121A. [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, 1977, w.e.f. 10-7-1978.]

Jurisdiction of Appellate Assistant Commissioners.

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

Jurisdiction of Inspecting Assistant Commissioners.

123. ²¹[R31] [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

²²[R32] [Jurisdiction of Assessing Officers.

²³[R33] 124. (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 Director Generals 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 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 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 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 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.]

Powers of Commissioner respecting specified areas, cases, persons, etc.

125. ²⁴[R34] [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

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

125A. ²⁵[R35] [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Original section was inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.]

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

126. ²⁶[R36] [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

²⁷[R37] [Power to transfer cases²⁸[R38] .

²⁹[R39] 127. (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 case³⁰[R40] 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 Commis-sioners 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 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, pass the order;

(b) where the Directors General or Chief Commissioners or Commis-sioners 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 stage³¹[R41] 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 thereunder, means all proceedings under this Act³¹[R42] 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.]

Functions of Inspectors of Income-tax.

128. ³²[R43] [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988].

Change of incumbent of an office.

³³[R44] 129. 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 assessee 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.

Commissioner competent to perform any function or functions.

130. ³⁴[R45] [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]

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

130A. ³⁵[R46] [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.]

C.—Powers

Power regarding discovery, production of evidence, etc.

³⁶[R47] 131.(1) The ³⁷[R48] [Assessing] Officer, ³⁸[R49] [Deputy Commissioner (Appeals)], ³⁹[R50] [Joint Commissioner] ⁴⁰[R51] [, Commissioner (Appeals)] and ⁴¹[R52] [Chief Com-missioner or Commissioner] shall, for the purposes of this Act, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the following matters, namely :—

(a) discovery and inspection;

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

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

(d) issuing commissions.

⁴²[R53] [(1A) ⁴³[R54] [If the Director General or Director or ⁴⁴[R55] [Joint] Director or Assistant Director ⁴⁵[R56] [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-section⁴⁶[R57] ,] 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 pending⁴⁶[R58] before him or any other income-tax authority.]

⁴⁷[R59] (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) ⁴⁸[R60] [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 ⁴⁹[R61] [Assessing] Officer ⁵⁰[R62] [or an ⁵¹[R63] [Assistant Director ⁵²[R64] [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 ⁵³[R65] [⁵⁴[R66] [Chief Commissioner or Director General or Commissioner or Director therefor, as the case may be.]]

⁵⁵[R67] [Search and seizure.

⁵⁶[R68] 132. ⁵⁷[R69] (1) Where the ⁵⁸[R70] [Director General or Director] or the ⁵⁹[R71] [Chief Commis- sioner or Commissioner] ⁶⁰[R72] [or any such ⁶¹[R73] [Joint Director] or ⁶²[R74] [Joint Commissioner] as may be empowered in this behalf by the Board], in consequence of information⁶³[R75] in his possession, has reason to believe⁶³[R76] 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, 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 thing⁶⁴[R77] and such money, bullion, jewellery or other valuable article or thing represents either wholly or partly income or property ⁶⁵[R78] [which has not been, or would not be, disclosed⁶⁴[R79] ] 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), ⁶⁶[R80] [then,—

(A) the ⁶⁷[R81] [Director General or Director] or the ⁶⁸[R82] [Chief Commissioner or Commissioner], as the case may be, may authorise any ⁶⁹[R83] [Joint Director], ⁷⁰[R84] [Joint Commissioner], ⁷¹[R85] [Assistant Director ⁷²[R86] [or Deputy Director]], ⁷³[R87] [Assistant Commissioner ⁷²[R88] [or Deputy Commissioner] or Income-tax Officer], or

(B) such ⁶⁹[R89] [Joint Director], or ⁷⁰[R90] [Joint Commissioner], as the case may be, may authorise any ⁷¹[R91] [Assistant Director ⁷²[R92] [or Deputy Director]], ⁷³[R93] [Assistant Commissioner ⁷²[R94] [or Deputy Commissioner] or Income-tax Officer], (the officer so authorised in all cases being hereinafter referred to as the authorised officer) to—]

(i) enter and search⁷⁴[R95] any ⁷⁵[R96] [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;

⁷⁶[R97] [(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;]

⁷⁷[R98] [(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, 2000 (21 of 2000)⁷⁸[R99] , to afford the authorised officer the necessary facility to inspect such books of account or other documents;]

(iii) seize⁷⁹[R100] any such⁷⁹[R101] books of account, other documents, money, bullion, jewellery or other valuable article or thing found as a result of such search:

^79a[R101] [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 authorised 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 therefrom;

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

⁸⁰[R102] [Provided that where any building, place, vessel, vehicle or aircraft referred to in clause (i) is within the area of jurisdiction of any ⁸¹[R103] [Chief Commissioner or Commissioner], but such ⁸¹[R104] [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 ⁸²[R105] [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 ⁸³[R106] [Chief Commissioner or Commissioner] having jurisdiction over such person may be prejudicial to the interests of the revenue :]

⁸⁴[R107] [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):]

^84a[R108] [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.]

⁸⁵[R109] [(1A) Where any ⁸⁶[R110] [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 ⁸⁷[R111] [Director General or Director] or any other ⁸⁸[R112] [Chief Commissioner or Commissioner] or any such ⁸⁹[R113] [Joint Director] or ⁹⁰[R114] [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 ⁹¹[R115] [Chief Commissioner or Commissioner] may, notwithstanding anything contained in section ⁹²[R116] [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) ⁹³[R117] [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 practicable⁹⁴[R118] to seize any such books of account, other documents, money, bullion, jewellery or other valuable article or thing, ⁹⁵[R119] [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 possession⁹⁴ [R120] 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.

⁹⁶[R121] [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.

⁹⁷[R122] [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.]

⁹⁸[R123] [(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.]

(5) ⁹⁹[R124] [***]

(6) ¹[R125] [***]

(7) ²[R126] [***]

(8) The books of account or other documents seized under sub-section (1) ³[R127] [or sub-section (1A)] shall not be retained by the authorised officer for a period exceeding ⁴[R128] [thirty days from the date of the order of assessment under ^4a[R129] [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 ⁵ [R130] [Chief Commissioner, Commissioner, Director General or Director] for such retention is obtained :

Provided that the ⁵[R131] [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[R132] [(8A) An order under sub-section (3) shall not be in force for a period exceeding sixty days from the date of the order.]

(9) The person from whose custody any books of account or other documents are seized under sub-section (1) ⁷[R133] [or sub-section (1A)] may make copies thereof, or take extracts therefrom, in the presence of the authorised officer or any other person empowered by him in this behalf, at such place and time as the authorised officer may appoint in this behalf.

⁸[R134] [(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 the 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 authorisations 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) ⁹[R135] [or sub-section (1A)] objects for any reason to the approval given by the ¹⁰[R136] [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 ¹¹[R137] [and the Board may, after giving the applicant an opportunity of being heard, pass such orders as it thinks fit].

(11) ¹²[R138] [***]

(11A) ¹³[R139] [***]

(12) ¹⁴[R140] [***]

¹⁵[R141] [(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).]

¹⁶[R142] (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 ¹⁷[R143] [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.

¹⁸[R144] [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.]

¹⁹[R145] [Powers to requisition books of account, etc.

²⁰[R146] 132A.²¹[R147] (1)Where the ²²[R148] [Director General or Director] or the ²³[R149] [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 authority²⁴[R150] 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 ²⁵[R151] [Director General or Director] or the ²⁶[R152] [Chief Commissioner or Commissioner] may authorise any ²⁷[R153] [Joint Director], ²⁸[R154] [Joint Commissioner], ²⁹[R155] [Assistant Director ³⁰[R156] [or Deputy Director]], ³¹[R157] [Assistant Commissioner ³⁰[R158] [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.]

³²[R159] [Application of seized or requisitioned assets.

132B. (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 ^32a[R160] [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:

^32b[R160] [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 authorisations 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 assessee 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 undischarged and for this purpose such assets shall be deemed to be under distraint as if such distraint 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.

(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.

(4) (a) The Central Government shall pay simple interest at the rate of ^32bb[R161] [six] per cent per annum 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 authorisations for search under section 132 or requisition under section 132A was executed to the date of completion of the assessment ^32c[R162] [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.]

Power to call for information.

³³[R163] 133. The ³⁴[[R164] Assessing] Officer, the ³⁵[R165] [Deputy Commissioner (Appeals),] ³⁶[R166] [the ³⁷[R167] [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 assessee 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 ³⁸[R168] [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 ³⁹[R169] [Assessing] Officer, the ⁴⁰[R170] [Deputy Commissioner (Appeals)] ⁴¹[R171] [, the ⁴²[R172] [Joint Commissioner] or the Commissioner (Appeals)], giving information in relation to such points or matters as, in the opinion of the ³⁹[R173] [Assessing] Officer, the ⁴⁰[R174] [Deputy Commi-ssioner (Appeals)] ⁴¹[R175] [, the ⁴²[R176] [Joint Commissioner] or the Commissioner (Appeals)], will be useful for, or relevant to, any ⁴³[R177] [enquiry⁴⁴[R178] or] proceeding⁴⁴[R179] under this Act :

⁴⁵[R180] [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 :]

⁴⁶[R181] [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.]

⁴⁷[R182] [Power of survey.

⁴⁸[R183] 133A. (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, ⁴⁹[R184] [or]

⁴⁹[R185] [(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 therefrom,

⁵⁰[R186] [(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

^50a[R187] [(b) retain in his custody any such books of account or other documents for a period exceeding ten days (exclusive of holidays) without obtaining the approval of the Chief Commissioner or Director General therefor, 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, ⁵¹[R188] [***] 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 assessee 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 assessee 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 ⁵²[R189] [sub-section (1) of section 131] for enforcing compliance with the requirement made :

⁵³[R190] [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,—

^54-59[R191] [(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.]

⁶⁰[R192] [Power to collect certain information.

133B. (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 prescribed⁶¹[R193] .

(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 ⁶²[R194] [Joint Commissioner], an ⁶³[R195] [Assistant Director] ⁶⁴[R196] [or Deputy Director] or an ⁶⁵[R197] [Assessing] Officer, and includes an Inspector of Income-tax who has been authorised by the ⁶⁵[R198] [Assessing] Officer to exercise the powers conferred under this section in relation to the area in respect of which the ⁶⁵[R199] [Assessing] Officer exercises jurisdiction or part thereof.]

Power to inspect registers of companies.

134. The ⁶⁶[R200] [Assessing] Officer, the ⁶⁷[R201] [Deputy Commissioner (Appeals)], ⁶⁸[R202] [the ⁶⁹[R203] [Joint Commissioner] or the Commissioner (Appeals)], or any person subordinate to him authorised in writing in this behalf by the ⁶⁶[R204] [Assessing] Officer, the ⁶⁷[R205] [Deputy Commissioner (Appeals)], ⁶⁸[R206] [the ⁶⁹[R207] [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.

Power of ⁷⁰[R208] [Director General or Director], ⁷¹[R209] [Chief Commissioner or Commissioner] and ⁷²[R210] [Joint Commissioner].

135. The ⁷⁰[R211] [Director General or Director], the ⁷¹[R212] [Chief Commissioner or Com- missioner] and the ⁷²[R213] [Joint Commissioner] shall be competent to make any enquiry under this Act, and for this purpose shall have all the powers that an ⁷³[R214] [Assessing] Officer has under this Act in relation to the making of enquiries.

Proceedings before income-tax authorities to be judicial proceedings.

⁷⁴[R215] 136. 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 (45 of 1860) ⁷⁵[R216] [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

Disclosure of information prohibited.

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

⁷⁶[R217] [Disclosure of information respecting assessees.

⁷⁷[R218] 138. ⁷⁸[R219] [(1)(a)The Board or any other income-tax authority specified by it by a general or special order 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 ⁷⁹[R220] foreign exchange as defined in section 2(d) of the Foreign Exchange Regulation Act, 1947 (7 of 1947)⁸⁰[R221] ; 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 notification⁸¹[R222] in the Official Gazette in this behalf, any such information ⁸²[R223] [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.

(b) Where a person makes an application to the ⁸³[R224] [Chief Commissioner or Commissioner] in the prescribed form⁸⁴[R225] for any information relating to any assessee ⁸⁵[R226] [received or obtained by any income-tax authority in the performance of his functions under this Act], the ⁸⁶[R227] [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 ⁸⁷[R228] [***] and his decision in this behalf shall be final and shall not be called in question in any court of law.]

(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 notified⁸⁸[R229] 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 assessees or except to such authorities as may be specified in the order.]

---

[R1]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Earlier, it 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

[R2]Inserted by the Finance Act, 1994, w.e.f. 1-6-1994

[R3]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R4]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Earlier, it 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

[R5] Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R6]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Prior to its substitution, section 118 stood as under :

‘118. Control of income-tax authorities.—(1) Inspecting Assistant Commissioners shall be subordinate to the Commissioner within whose jurisdiction they perform their functions, and also to the Director of Inspection.

(2) Income-tax Officers shall be subordinate to the Commissioner and the Inspecting Assistant Commissioner within whose jurisdiction they perform their functions and also to the Director of Inspection.

(3) Inspectors of Income-tax shall be subordinate to the Income-tax Officer or other income-tax authority under whom they are appointed to work and to any other income-tax authority to whom the said officer or other authority is subordinate.

Explanation.—For the purposes of sub-section (1), “Director of Inspection” does not include a Deputy Director of Inspection or an Assistant Director of Inspection; and for the purposes of sub-section (2), “Director of Inspection” does not include an Assistant Director of Inspection.

[R7]Substituted by the Taxation Laws (Amendment) Act, 1970, w.e.f. 1-4-1971

[R8]See also Instruction No. 796, dated 22-11-1974.

[R9]Words “Deputy Commissioner (Appeals) or the” omitted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner (Appeals)” was substituted for “Appellate Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R10]Inserted by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[R11]See rule 111B.

[R12]Inserted by the Finance Act, 1990, w.e.f. 1-4-1990.

[R13]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.

[R14]Substituted for “210, 234A, 234B” by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1991. Earlier “234A, 234B” were inserted by the Finance Act, 1990, w.e.f. 1-4-1990.

[R15]For Board’s instructions to subordinate authorities, from time to time see Direct Taxes Circulars.

[R16] See also Circular No. 8/2001, dated 16-5-2001

[R17]Substituted for “the Commissioner or the Income-tax Officer” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R18]Words “Deputy Commissioner (Appeals) or the” omitted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R19]Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-10-1991.

[R20]Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Prior to its omission, sub-section (3) stood as under :

“(3) Every Income-tax Officer employed in the execution of this Act shall observe and follow such instructions as may be issued to him for his guidance by the Director of Inspection or by the Commissioner or by the Inspecting Assistant Commissioner within whose jurisdiction he performs his functions.”

[R21]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R22]For Board’s directions issued for exercise of powers and jurisdiction of income-tax authorities from time to time, see Direct Taxes Circulars

[R23]Substituted for “Deputy” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R24]Inserted by the Finance (No. 2) Act, 1996, w.e.f. 1-10-1996.

[R25] Substituted for “Deputy” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R26]Substituted for “Deputy” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R27]Inserted by the Finance (No. 2) Act, 1996, w.e.f. 1-10-1996.

[R28]Substituted for “Deputy” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R29]Substituted for “Deputy” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R30]Prior to its omission, section 121 was amended by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967.

[R31]Prior to its omission, section 123 was substituted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967.

[R32]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Prior to its 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.

[R33]For relevant case laws

[R34]Prior to its omission, section 125 was substituted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967 and later on 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.

[R35]Prior to its omission, section 125A was amended by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[R36]Prior to its omission, section 126 was amended by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[R37]Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Prior to its substitution, section 127 was substituted 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.

[R38] See also Circular No. 770, dated 16-9-1998.

[R39]For relevant case laws

[R40]For the meaning of the term “case”

[R41]For the meaning of term/expression “stage” and “all proceedings under this Act”

[R42]For the meaning of term/expression “stage” and “all proceedings under this Act”,

[R43]Prior to its omission, section 128 was substituted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967.

[R44]For relevant case laws

[R45]Prior to its 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.

[R46]Prior to its omission, section 130A was amended by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R47]See also Circular No. 8-D (LXXVI-22), dated 13-5-1958.

For relevant case laws

[R48]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R49]Substituted for “Appellate Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R50] Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commisisoner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R51]Inserted by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978

[R52]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R53]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R54]Substituted for “If the Assistant Director of Inspection” by the Finance Act, 1988, w.e.f. 1-6-1988.

[R55] Substituted for “Deputy” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R56]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R57]For the meaning of the expressions “referred to... sub-section” and “notwithstanding that are pending”,

[R58]For the meaning of the expressions “referred to... sub-section” and “notwithstanding that are pending

[R59]Prior to its omission, sub-section (2) stood as under :

“(2) Without prejudice to the provisions of any other law for the time being in force, where a person to whom a summons is issued either to attend to give evidence or produce books of account or other documents at a certain place and time, intentionally omits to attend or produce the books of account or documents at the place or time, the income-tax authority may impose upon him such fine not exceeding five hundred rupees as it thinks fit, and the fine so levied may be recovered in the manner provided in Chapter XVII-D.”

[R60]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R61]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R62]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R63]Substituted for “Assistant Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R64]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R65]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R66]Substituted for “Chief Commissioner or Commissioner therefor” by the Finance Act, 1988, w.e.f. 1-6-1988.

[R67]Substituted by the Income-tax (Amendment) Act, 1965, w.e.f. 12-3-1965. Earlier, section 132 was substituted by the Finance Act, 1964, w.e.f. 1-4-1964. Section 6 of the Amendment Act, 1965 has made the following independent provision :

“Validation of certain searches made.—Any search of a building or place by an Inspecting Assistant Commissioner or Income-tax Officer purported to have been made in pursuance of sub-section (1) of section 132 of the principal Act before the commencement of this Act shall be deemed to have been made in accordance with the provisions of that sub-section as amended by this Act as if those provisions were in force on the day the search was made and shall not be called in question before any court of law or any other authority merely on the ground—

(i) that the Inspecting Assistant Commissioner or the Income-tax Officer made such search with the assistance of any other person; or

(ii) that no proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or the principal Act was pending against the person concerned when the search was authorised under the said sub-section.”

[R68]See rule 112. For relevant case laws, see Income-tax Act. For charter of rights and duties of persons searched,

[R69]See rule 112(2)(a) and Form No. 45 for form of authorisation for search and seizure

[R70]Substituted for “Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R71]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R72]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R73]Substituted for “Deputy Director” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Director” was substituted for “Deputy Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R74]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R75]For the meaning of the terms/expressions “information” and “reason to believe

[R76]For the meaning of the terms/expressions “information” and “reason to believe

[R77]For the meaning of the terms/expressions “other valuable article or thing” and “income which has not been, or would not be, disclosed”

[R78]Substituted for “which has not been disclosed” by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R79]For the meaning of the terms/expressions “other valuable article or thing” and “income which has not been, or would not be, disclosed”

[R80]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.

[R81]Substituted for “Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R82]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R83]Substituted for “Deputy Director” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Director” was substituted for “Deputy Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R84]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R85]Substituted for “Assistant Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R86]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R87]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.

[R88]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R89]Substituted for “Deputy Director” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Director” was substituted for “Deputy Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R90]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R91]Substituted for “Assistant Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R92]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R93]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.

[R94]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R95]For the meaning of the term “search”

[R96]Substituted for “building or place” by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R97]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R98]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.

[R99]For definition of “electronic record” as defined in section 2(1)(t) of the Information Technology Act, 2000, see Appendix One.

[R100]For the meaning of the terms “seize” and “such”

[R101]For the meaning of the terms “seize” and “such”,

[R102]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975. See rule 112(2)(b) and Form No. 45A for form of authorisation for search and seizure.

[R103]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R104]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R105]Substituted for “121” by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988), w.e.f. 1-4-1988.

[R106]Substituted for “Commissioner”, by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988), w.e.f. 1-4-1988.

[R107]Inserted by the Finance Act, 1988, w.e.f. 1-4-1989.

[R108]Inserted by the Finance Act, 2003, w.e.f. 1-6-2003.

[R109]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975. See rule 112(2)(c)

and Form No. 45B.

[R110]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R111]Substituted for “Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R112]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R113]Substituted for “Deputy Director” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Director” was substituted for “Deputy Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R114]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R115]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R116]Substituted for “121” by the Direct Tax Laws (Amendment) Act, 1987 (as amended by the Finance Act, 1988), w.e.f. 1-4-1988.

[R117]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R118]For the meaning of the terms “practicable” and “possession”,

[R119]Inserted by the Finance Act, 1988, w.e.f. 1-4-1989.

[R120]For the meaning of the terms “practicable” and “possession”

[R121]Inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989

[R122]Inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[R123]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R124]Omitted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to its omission, sub-section (5), as amended by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975, Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984, Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988, Finance Act, 1995, w.e.f. 1-7-1995 and Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, read as under :

“(5) 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), as a result of a search initiated or requisition made before the 1st day of July, 1995, the Income-tax Officer, after affording a reasonable opportunity to the person concerned of being heard and making such enquiry as may be prescribed†, shall, within one hundred and twenty days of the seizure, make an order, with the previous approval of the 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 ;

(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), (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 Income-tax 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 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), (iia) and (iii) or any part thereof, the Income-tax Officer may, with the previous approval of the Chief Commissioner or Commissioner, release the assets or such part thereof as he may deem fit in the circumstances of the case.”

†See rules 112A and 112B.

[R125]Omitted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to its omission, sub-section (6), as amended by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975, read as under :

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

[R126]Omitted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to its omission, sub-section (7) read as under :

“(7) If the Income-tax 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 Income-tax Officer may proceed under sub-section (5) against such other person and all the provisions of this section shall apply accordingly.”

[R127]Inserted by the Taxation Laws (Amendment) Act, 1975, w,e.f. 1-10-1975.

[R128]Substituted for “one hundred and eighty days from the date of the seizure” by the Finance Act, 2002, w.e.f. 1-6-2002.

[R129]Inserted by the Finance Act, 2003, w.e.f. 1-6-2003.

[R130]Substituted for “Chief Commissioner or Commissioner” by the Finance Act, 1997, w.r.e.f. 1-10-1996. Earlier “Chief Commissioner or Commissioner” was substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R131]Substituted for “Chief Commissioner or Commissioner” by the Finance Act, 1997, w.r.e.f. 1-10-1996. Earlier “Chief Commissioner or Commissioner” was substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R132]Substituted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to its substitution, sub-section (8A), as inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989 and amended by the Finance (No. 2) Act, 1991, w.e.f. 1-10-1991, 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 Director or, as the case may be, Commissioner for such extension :

Provided that the 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.”

[R133]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R134]Substituted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to its substitution, sub-section (9A), as inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975, 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 Income-tax 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 Income-tax Officer*.”

*Should be Assessing Officer.

[R135]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R136]Substituted for “Chief Commissioner or Commissioner” by the Finance Act, 1997, w.r.e.f. 1-10-1996. Earlier “Chief Commissioner or Commissioner” was substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R137]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.

[R138]Omitted by the Finance Act, 2002, w.e.f. 1-6-2002.. Prior to its omission, sub-section (11), as amended by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984 and Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988, 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 the Chief Commissioner or Commissioner, stating therein the reasons for such objection and requesting for appropriate relief in the matter.”

[R139]Omitted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to its omission, sub-section (11A), as inserted by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984 and amended by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988, read as under :

“(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 Chief Commissioner or Commissioner, and the 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.”

[R140]Omitted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to its omission, sub-section (12), as amended by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984 and Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988, read as under :

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

[R141]Substituted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R142]See rule 112.

[R143]Substituted for “such building or place” by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R144]Substituted by the Finance Act, 2002, w.e.f. 1-6-2002. Prior to its substitution Explanation 1, as amended by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984 and Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989, read as under :

“Explanation 1.—In computing 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.”

[R145]Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975.

[R146]For relevant case laws

[R147]See rule 112D and Form No. 45C for form of authorisation under section 132A(1).

[R148]Substituted for “Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R149]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R150]For the meaning of the term “authority”

[R151]Substituted for “Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R152]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R153]Substituted for “Deputy Director” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Director” was substituted for “Deputy Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R154]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R155]Substituted for “Assistant Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R156]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R157]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.

[R158]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R159]Substituted by the Finance Act, 2002, w.e.f. 1-6-2002. See rule 112C. Prior to its substitution, section 132B, inserted as section 132A by the Income-tax (Amendment) Act, 1965, w.e.f 12-3-1965 and renumbered as “132B” by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975, and later on amended by the Taxation Laws (Amendment) Act, 1967, w.e.f. 1-10-1967, Finance Act, 1972, w.e.f. 1-4-1972, Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984 and Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988/1-4-1989, read as under:

“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 (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 Assessing Officer may apply such money in the discharge of the liabilities referred to in clause (i) and the assessee 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 undischarged and for this purpose such assets shall be deemed to be under distraint as if such distraint was effected by the Assessing Officer or, as the case may be, 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, 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.

(4) (a) The Central Government shall pay simple interest at the rate of 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.”

[R160]Substituted for “under Chapter XIV-B for the block period” by the Finance Act, 2003, w.e.f. 1-6-2003.

[R161]Substituted for “eight” by the Taxation Laws (Amendment) Act, 2003, w.r.e.f. 8-9-2003.

[R162]Inserted by the Finance Act, 2003, w.e.f. 1-6-2003.

[R163]For relevant case laws

[R164]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R165]Substituted for “Appellate Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R166]Substituted for “or the Inspecting Assistant Commissioner” by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[R167]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R168]Substituted for “four hundred rupees” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[R169]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R170]Substituted for “Appellate Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R171]Substituted for “or the Inspecting Assistant Commissioner” by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[R172]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R173]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R174]Substituted for “Appellate Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R175]Substituted for “or the Inspecting Assistant Commissioner” by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[R176]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R177]Inserted by the Finance Act, 1995, w.e.f. 1-7-1995.

[R178]For the meaning of the term “proceeding”/“enquiry”,

[R179]For the meaning of the term “proceeding”/“enquiry”,

[R180]Inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[R181]Inserted by the Finance Act, 1995, w.e.f. 1-7-1995

[R182]Substituted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-10-1975. Original section was inserted by the Finance Act, 1964, w.e.f. 1-4-1964.

[R183]See also Circular No. 7-D(LXIII-7), dated 3-5-1967.

[R184]Inserted by the Finance Act, 1995, w.e.f. 1-7-1995.

[R185]Inserted by the Finance Act, 1995, w.e.f. 1-7-1995.

[R186]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.

[R187]Substituted by the Finance Act, 2003, w.e.f. 1-6-2003. Prior to its substitution, clause (b) 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 therefor, as the case may be,”

[R188]Words “any books of account or other documents or” omitted by the Finance Act, 2002, w.e.f. 1-6-2002.

[R189]Substituted for “sub-sections (1) and (2) of section 131” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[R190]Inserted by the Finance Act, 2003, w.e.f. 1-6-2003.

[R191]Substituted by the Finance Act, 2003, w.e.f. 1-6-2003. Prior to its substitution, clause (a), as amended by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988/1-4-1989, Finance Act, 1995, w.e.f. 1-7-1995 and Finance (No. 2) Act, 1998, w.e.f. 1-10-1998, read as under :

‘(a) “income-tax authority” means a Commissioner, a Joint Commissioner, a Director, a Joint Director, an Assistant Director or Deputy Director or an 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, if so authorised by any such authority.’

[R192]Inserted by the Finance Act, 1986, w.e.f. 13-5-1986.

[R193]See rule 112E and Form No. 45D for form of information required to be furnished under section 133B(1).

[R194]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R195]Substituted for “Assistant Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R196]Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998.

[R197]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R198]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R199]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R200]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R201]Substituted for “Appellate Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R202]Substituted for “or the Inspecting Assistant Commissioner” by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[R203]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R204]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R205]Substituted for “Appellate Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R206]Substituted for “or the Inspecting Assistant Commissioner” by the Finance (No. 2) Act, 1977, w.e.f. 10-7-1978.

[R207]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R208]Substituted for “Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R209]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R210]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R211]Substituted for “Director of Inspection” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988

[R212]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R213]Substituted for “Deputy Commissioner” by the Finance (No. 2) Act, 1998, w.e.f. 1-10-1998. Earlier “Deputy Commissioner” was substituted for “Inspecting Assistant Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R214]Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R215]For relevant case laws

[R216]Inserted by the Finance Act, 1985, w.r.e.f. 1-4-1974

[R217]Substituted by the Finance Act, 1964, w.e.f. 1-4-1964.

[R218]For relevant case laws

[R219]Substituted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967.

[R220]For definition of “foreign exchange

[R221]Since repealed and now the Foreign Exchange Regulation Act, 1973 (46 of 1973)/Foreign Exchange Management Act, 1999 (42 of 1999).

[R222]For specified income-tax/other authorities, see Income-tax Act.

[R223]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.

[R224]Substituted for “Commissioner” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R225]See rule 113 and Form Nos. 46 to 49 for form of application to Commissioner for disclosure of information, form of information furnished by Commissioner and form of refusal to furnish information, respectively.

[R226]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” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[R227]Substituted for “Commissioner”, by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.

[R228]“in respect of that assessment only” omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.

[R229]For order notified under sub-section (2)