Budget 2022: Explanation to Sec 133A proposed to be amended



Quick Summary
Budget 2022 proposes an amendment to the Explanation of Section 133A of the Income Tax Act. This section grants income-tax authorities the power to enter business premises to verify accounts and assets. The amendment clarifies which authorities are recognised for these powers, specifying they must be subordinate to certain high-ranking officials designated by the Board. This change is set to take effect from April 1, 2022.

Income-tax authorities for the purposes of section 133A of the Act

1. Section 133A of the Act enables an income-tax authority to enter any place of business or profession or charitable activity within his jurisdiction to verify the books of account or other documents, cash, stock or other valuable article or thing, which may be useful for or relevant to any proceeding under this Act. Explanation to section 133A provides the definition of an income tax authority for the purposes of this section.

2. Through Taxation and Other Laws (Amendment and Relaxation of Certain Provisions) Act, 2020, the Explanation was amended to provide that any the income- tax authority who is subordinate to the Principal Director General of Income-tax (Investigation) or the Director General of Income-tax (Investigation) or the Principal Chief Commissioner of Income-tax (TDS) or the Chief Commissioner of Income-tax (TDS), as the case may be shall only be considered as Income-tax authorities for the purposes of section 133A.

3. It is proposed to amend the Explanation to section 133A of the Act to provide that income tax authority shall be sub-ordinate to Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner, as the case may be, specified by the Board.

Budget 2022: Section 133A Income Tax Amendment Explained

5. This amendment will take effect from 1st April, 2022.

[Clause 37]

FAQ :

Section 133A allows income-tax authorities to enter any place of business, profession, or charitable activity within their jurisdiction to examine books of account, documents, cash, stock, or other valuable items relevant to proceedings under the Act.

Through the Taxation and Other Laws (Amendment and Relaxation of Certain Provisions) Act, 2020, the Explanation was changed to state that only income-tax authorities subordinate to specific high-ranking officials like the Principal Director General of Income-tax (Investigation) or Chief Commissioner of Income-tax (TDS) could be considered for the purposes of Section 133A.

Budget 2022 proposes to amend the Explanation to Section 133A to state that an income tax authority shall be subordinate to Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner, as specified by the Board.

This amendment is proposed to take effect from April 1, 2022.

The Board will specify the Principal Director General, Director General, Principal Chief Commissioner, or Chief Commissioner to whom the income tax authority must be subordinate.




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Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.

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