SEARCH, SEAZURE & SURVEY
UNDER INCOME TAX ACT
ANUP VAISHNAV
SURESH SURANA & ASSOCIATES
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
CONTENTS
OVERVIEW OF PROCESS
WHEN & WHY SEARCH IS
CONDUCTED
HOW SEARCH IS
CONDUCTED
RIGHTS AND DUTIES OF
THE PERSON SEARCHED
PRECAUTIONARY
MEASURES WHICH HELPS
DURING SEARCH
SEIZURES
ITEMS WHICH CAN NOT BE
SEIZED
ITEMS WHICH CAN BE
SEIZED
SSA, SURAT
POST SEARCH
PROCEDURES
RECORDING OF
STATEMENT AND
DISCLOSURE
ISSUANCE OF NOTICE, TAX
PAYMENT & FILING OF
RETURNS
ASSESSMENT OF RETURNS
FILED
SURVEY
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
OVERVIEW OF PROCESS
Investigation & Inquiry
Formation of Reasonable Belief
Authorisation by Competent Authority
Actual Operation
Seizure of Books, Documents, Valuables, Cash Etc
Recording of Statement & Disclosure
Appraisal Report
Issuance of Notice
Payment of Tax & Filing of Returns in response to Notice
Assessment of Returns filed
Release of Items Seized
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
WHEN & WHY SEARCH IS
CONDUCTED
•
When any summons or notice issued by IT Dept is not responded
•
When Summons is issue dfor production of books of accounts,
however no response is received from the asseessee.
•
When Competent Authority forms belief that a person is having
unaccounted income inform of cash, bulion, jewellery, etc on the basis
of information inn his possession
•
CBDT Guideline on Search & Seizure
- Searches not to be conducted casually
- Min Expected Disclosure of Rs 100.00 Lacs
- Professionals of high repute not to be searched
•
Authorisation for Search
- Director of Investigation (DI)
- Deputy Director of Investigation (DDI)
- Assistant Director of Investigation
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
HOW SEARCH IS CONDUCTED
• Issuance of Search Warrants Specifying
Person and Places to be searched
• Time of Commencement and Continuance
of Search
• Manner of Search
• Closing of search operation
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
RIGHTS & DUTIES OF THE
PERSON SEARCHED
• Rights
-
• Duties
Right to check identity of each
- To allow search party of enter
of the member of search party
in premises without creating
Right to have authorised
obstacles
representative
- To sign search warrant
Right to have witnesses
- To give explanation when
Right to search every person of
asked
serch party when they leave the
place
- Restrict entry of any
unauthorised persons
To call doctor for the ill person
To send kids to school after
- Move any items without
verification of their school bags
permission of search party
Female to be searched by
- To Co Operate search party
female only
To have inventory of items
found and seized
To use phones
To have copy of sttements
recorded
SSA, SURAT
To have copy of books and
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
PRECAUTIONARY MEASURES WHICH
HELPS DURING SEARCH
• To keep cash book upto date and have idea of average cash
balance in every account / file
• To keep stock book up to date and keep on tallying the same
with physical stock at reasonable intervals
• Not to keep un necessary rough notes, chits containg any
financial data
• To have idea of assets which are on record
• To record almost all household items, major expenses,
personal expenses on books of accounts of business and to
make payment through cheque for major items of expenses
and investment
• To Cooperate and help the search party
• To have knowledge of firm names, partnership, director ship
held, companies operated and their businesses, their bank
accounts – More particularly in case of females
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
PRECAUTIONARY MEASURES WHICH
HELPS DURING SEARCH
• Not to keep any Alchoholic Drugs in Home without permit
• To take expenses of marriage and functions on books
• Not to carry on business in the proprietary concern of
female, old aged persons unless they are able to justify
running of business
• Not to have undue entries on books
• Not to keep unnecessary files on computers containing
various calculations and datas
• No disclosure if data is More Than 6 Year old
• To have bills for modification in jewellery
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
SEIZURES
•
•
•
•
•
•
Items which can not be seized
Items Which can be Seized
Inventory of item Seized
Deemed Seizure
Utilisation of Seized Items
Release of Seized Items
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
ITEMS WHICH CAN NOT BE SEIZED
•
•
•
•
•
•
•
Immovable assets
Stock held in business
Items disclosed in Income Tax and Wealth tax Returns
Items appearing in books of accounts
Cash for which explanation can be given
Jewellery mentioned in wealth tax return
Gold up to 500 Gm per married woman, 250Gm per
unmarried woman and 100Gm per male member of the
family
• Jewelley as per the status of the family if so appear to
investigating officer
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
ITEMS WHICH CAN BE SEIZED
• Unaccounted cash, jewellery, gold, bullion,
lockers, promissory notes, cheques, drafts
• Books of accounts, chits, diaries etc
• Computer Hard Disks and other data
storage devises
• Documents of property, title deeds etc
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
POST SEARCH PROCEDURES
•
•
•
•
•
•
Revocation of Prohibitory Order
Completion of statements recorded
Further explanations of the documents seized
Appraisal report
Issuance of Notice
Assesment
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
RECORDING OF STATEMENT
AND DISCLOSURE
•
•
•
•
•
Statement recorded on the date of search
Financial Years for which disclosure can be taken
Disclosure of Income
Items and Documents Seized and Disclosure
Items having bearing on the Disclosure
–
–
–
–
–
–
–
Unaccounted assets
Unaccounted Business Expenses – Wages / Purchases etc
Unaccounted Personal expenses
Production data and unaccounted sales
Disclosure by third party
Incidence of interest and penalty
Proposed Purchase of fixed asset having higher depreciation
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
ISSUANCE OF NOTICE, TAX PAYMENT &
FILING OF RETURNS
• New scheme for assessment of Search
Cases
• Time limit for issuance of Notice
• Time limit for filing of tax return
• Applicable Taxes , Interest and Penalty
• Manner of filing tax returns
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
ASSESSMENT OF RETURNS FILED
• Assessment procedures
• Status of pending assessments
• Areas which can be covered by the
Assessing Officer
• Tax Interest & Penalty
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
SURVEY
•
•
•
•
•
What is Survey ?
How it defers from Search ?
How it is conducted ?
No seizures
Disclosure and Tax Payable
SSA, SURAT
NOTES
•
•
•
•
•
•
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
SSA, SURAT
THANK YOU
SSA, SURAT