Search & Seizure as per Provisions of The Income Tax Act, 2025

by Ram Dutt Sharma

Chapter
1. Historical and Legislative Background	1
2. Organization and Process of Search and Seizure Operations	13
3. Overview of the Legal Provisions	28
4. Preparation for Carrying out a Search and Seizure Action	39
5. Satisfaction note in Search Cases	45
6. Warrant of Authorisation	62
7. Rights and Duties of Income Tax Department	95
8. Rights and Duties of Persons Searched	102
9. Role of Witnesses in Income Tax Search proceedings	108
10. Centralization of Search Cases - Transfer of cases from one Assessing Officer to another Assessing Officer	118
11. Decentralization of cases from Central Charges	156
12. Powers regarding discovery, production of evidence, etc.	164
13. When can Search be Authorised	175
14. Warrant of authorisation - No jurisdiction over the person	196
15. Extension of Authorisation	197
16. Prohibitory order where it is not possible or practicable to take physical possession to seize, any valuable article or thing	200
17. Prohibitory order where it is not practicable to seize, any books of account, other documents, asset	203
18. Power to requisition service of a Police Officer or Officer of the Central Governmentor of both; or any person or entity	220
19. Recording of Statement	225
20. Preliminary statement of the occupants of the premises	245
21. Art of Recording of Statement of Assessees/Witnesses	249
22. Evidentiary Value of Statement recorded during Search Operation	259
23. Retraction of Confession made in Statement during the Search proceedings	274
24. Surrender of undisclosed income during the course of search	301
25. Presumptions as to Assets, Books of Account, etc.	306
26. Power to attach provisionally any property belonging to the assessee	323
27. Power to make reference to Valuation Officer	327
28. Applicability of provisions of the Bharatiya Nagarik Suraksha Sanhita, 2023	334
29. Applicability of Provisions of the Bharatiya Nyaya Sanhita, 2023	337
30. Power of Board to make rules	342
31. Powers to requisition books of account, etc.	347
32. Reasons not to be disclosed	370
33. Application of seized or requisitioned assets	373
34. Seized assets may be applied towards existing and future liability	379
35. Release of seized asset on an application made by the person concerned	384
36. Money seized may be applied for discharging the liabilities	402
37. Assets other than money may also be applied to discharge liabilities	403
38. Non-Exclusivity of Recovery Modes	404
39. Return of excess assets seized	405
40. Interest on Excess Retention & Period for Interest Calculation	411
41. Jurisdiction and Transfer of Seized Material - Where the Authorised Officer is not the Assessing Officer of the person searched	420
42. Right to make copies or take extracts	423
43. Retention of Assets and material seized	428
44. Right to object to the approval given for Retention of Seized Documents under section 251(3)	431
45. Conversion of Survey into Search	435
46. Searching the premises - What does the search party generally look out for during search operation	443
47. Assets which can be seized during search operation	449
48. Assets which cannot be seized during search operation	464
49. Panchnama	474
50. Appraisal Report	485
51. Inspection of seized books of accounts and documents by the person searched	491
52. Treatment of Cash found during Search Operation	494
53. Depositing the seized money in the Personal Deposit Account(PD Account)	510
54. Treatment of Jewellery found during Search Operation	516
55. Treatment of notings in diary, loose papers, dumb papers, electronic images, etc. found during Search Operation	539
56. Treatment of Discrepancies in Stock-in-Trade found at the time of Search Operation	591
57. Admissibility of electronic evidence in a court of law	598
58. Consequences of a search being held as Illegal	600
59. Exclusions from Faceless Assessment	620
60. Special procedure for assessment of search cases - [Block period for searches conducted on or after 01.04.2026]	622
61. Assessment of total undisclosed income as a result of search	624
62. Computation of Total Income of the Block Period	629
63. Procedure for Block Assessment	638
64. Tax in case of Block Assessment of Search cases	642
65. Undisclosed Income of any Other Person	643
66. Time-limit for completion of Block Assessment	655
67. Certain interests and penalties not to be levied or imposed	669
68. Levy of Interest and Penalty in certain cases	671
69. Authority competent to make Assessment of Block Period	678
70. Application of other provisions of Act	679
71. Authorisation and Assessment in case of Search or Requisition	682
72. Interpretation	684
73. Assessment of Income pertaining to the Block Period for searches conducted on or after 01.09.2024 to 31.03.2026	690
74. Assessment of income in case of a Searched person	695
75. Procedure of assessment in cases where a search was initiated under section 132/132A after 31.05.2003 but before 31.03.2021	708
76. Applicable Rate of Tax in Search Assessment in the case of a person where a Search initiated [after 31.05.2003 but on or before 31.08.2024]	810
77. Assessment in Search cases	812
78. Penalties in Search Cases	814
79. Offences and Prosecutions in Search Cases	836
80. Important Forms	926

About the Author

Ram Dutt Sharma

Ram Dutt Sharma was born on 27th June, 1958 in Narnaul, Haryana. He got his post-graduation from M.D. University, Rohtak in 1980. He joined the Income-tax Department in the year 1983 and retired as Income Tax Officer on 30.06.2018. He worked at various stations of North-West Region of Income-tax Department. He has wide experience of all wings of Income-tax Department such as Assessment Unit, Special Range, TDS Wing, Investigation Wing, etc. He has been Contributing articles and addressing on topics relating to Income Tax at NADT Regional Campus, Chandigarh & Bhopal. He has also addressed number of seminars organized by the Income-tax Department, Chartered Accountants, Advocates and various Trade Associations.

He is recipient of first-ever Finance Minister's Award 2017, the Income Tax Departments highest honour for sustained devotion, commitment to duty & promoting excellence in the field of Direct Taxation at National Level. The Hon'ble Union Finance Minister, Shri ArunJaitley conferred this Finance Ministers Award for Excellence for his meritorious services at VigyanBhawan, New Delhi on 24.07.2017.

Awarded by Hon'ble Member (Revenue& TPS), CBT, Special Secretary to the Government of India Certificate of Appreciation for his contribution recognized and included in the chapter Miscellaneous Orders in Let Us Share A compilation of Best Practices & Orders Vol. VIII released on 31stOctober, 2016.

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