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2nd Part: Search and Seizure Operation(from execution of warrant of authorization to pre assessment stage)

Before making a search, the Authorized Officer (AO) shall (a) call upon two/more respectable inhabitants of the locality where a building/place is to be searched, and (b) call upon two/more persons where a vessel/vehicle/aircraft is to be searched- and may issue an order in writing to them to attend and witness the search [Refer Rule 112(6)].
What AO can do?  AO can:-
(i) enter and search any building, place, vessel, vehicle or aircraft (search area) where he has “reason to suspect” that such books of account/other documents, money, bullion, jewellery or other valuable article or thing (undisclosed property) are kept;
(ii) where the keys of lock of any door/box/locker/safe/almirah/other receptacle are not available to break open the lock thereof for search;
(iia) search any person who has got out of, or is about to get into, or is in, search area, if the AO has “reason to suspect” that such person has secreted about his person any such books of account/ undisclosed property.
(iib) require any person who is found to be in possession or control of any books of account maintained in the form of electronic record to afford the AO the necessary facility to inspect such books of account;
(iii) seize any such books of account/undisclosed property found as a result of such search: If undisclosed property found as a result of such search are stock-in-trade of the business it shall not be seized. The AO shall make an inventory of such stock-in-trade of the business [Refer Proviso to clause (iii) of section 132(1)]
(iv) place marks of identification on any books of account or make extracts or copies there from;
(v) make an inventory of any such undisclosed property [Refer Clauses (i),(ii),(iia),(iib),(iii),(iv) and (v) of section 132(1) respectively]
The AO may requisition the services of any police officer/Central Government officer to assist him for the purposes specified in section 132(1)/132(1A) and it shall be the duty of such officer to comply with such requisition [Refer Section 132(2)]. Keeping police officer will not amount to use of excessive force[1969] 74 ITR 836 (SC).

Any person in charge of/in any search area shall on demand and on production of authority allow the AO free ingress thereto and afford all reasonable facilities for a search therein[Refer Rule 112(3)]. Charter of Rights and Duties of persons searched has been issued by the CBDT has to be strictly followed.

If after notifying the authority and purpose and demand for entrance into such building/place the AO cannot obtain admittance, it shall be lawful for him with assistance of police officer &/ central government officer to break open any outer/inner door/window of any building/place [Refer Rule 112(4)]. If any building/place is occupied by a woman who customarily does not appear in public, the AO shall before entering such building/place give notice to such woman that she is at liberty to withdraw and shall afford her every reasonable facility for withdrawing and may then break open the apartment and enter it [Refer Proviso to Rule 112(4)].
If entrance into any vessel/vehicle/aircraft authorized to be searched cannot be obtained because it is moving/any other reason, it shall be lawful for him with assistance of police officer &/ central government officer to stop/land the vessel/vehicle/aircraft and if required to break open any outer/inner door/window of any such vessel/vehicle/aircraft if after notifying the authority and purpose and demand for entrance into such vessel/vehicle/aircraft the AO cannot obtain admittance [Refer Rule 112(4A)]. If such vessel/vehicle/aircraft is occupied by a woman who customarily does not appear in public, the AO shall before entering such vessel/vehicle/aircraft give notice to such woman that she is at liberty to withdraw and shall afford her every reasonable facility for withdrawing [Refer Proviso to Rule 112(4A)].
The AO may require any person who in the owner/has the immediate possession/control of any box/locker/safe/almirah/other receptacle situate in such building/place/vessel/aircraft to open and allow access to inspect/examine its contents and where the keys thereof are not available to break open the lock thereof for search[Refer Rule 112(4B)]
The AO may serve an order on the owner/person who has immediate possession/control of any valuable article/thing that he shall not remove, part with or otherwise deal with it, except with the previous permission of such AO where it is not possible/practicable to take physical possession of any valuable article/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. This action of the AO shall be deemed to be seizure of such valuable article/thing. [Refer 2nd proviso to section 132(1) and Rule 112(4C). Scope of Rule 112(4C) is wider than the 2nd proviso to section 132(1) as books of account/other documents are further included in the Rule which is not mentioned in the said proviso. As such books of account/other documents cannot be deemed to be a seizure]. If any undisclosed property is stock-in-trade of the business, it cannot be deemed to be seizure by virtue provisions of 2nd proviso. [Refer 3rd proviso to section 132(1)]
With assistance the AO may search any person as referred to in section 132(1) (iia) but if such person is a woman, the search shall be made by another woman with a strict regard to decency [Refer Rule 112(5)].
Where it is not practicable to seize any such books of account, or undisclosed property for reasons other than those mentioned in the second proviso to section 132(1), the AO may serve an order on the owner/ person who is in immediate possession or control thereof that he shall not remove, part with or otherwise deal with it except with the previous permission of such officer and such officer may take such steps as may be necessary for ensuring compliance with this sub-section. Serving of an order u/s 132(3) shall not be deemed to be seizure [Refer Exp below section 132(3)] and an order u/s 132(3) shall not be in force exceeding sixty days from the date of order[Refer section 132(8A)].
The AO may examine on oath any person, in respect of all matters relevant for the purposes of any investigation connected with any proceeding under the Act, who is found to be in possession/control of any books of account/documents/undisclosed property and any statement made by such person during such examination may thereafter be used in evidence in any proceeding under the Act [Refer section 132(4)].
It is presumed that the books of account/other documents/undisclosed property found in possession/control of any person during search belong to such person and the contents of such are true further that the signature/handwriting are in that person’s handwriting and if these are stamped/executed/attested these are duly done by whom it purports to have been so done [Refer Section 132(4A)]. Presumption u/s 132(4A) is not an ingredient of the offense u/s 276C and 277 [1999] 236 ITR 683 (SC).
A list of all things seized during search and of the places in which they were respectively found shall be prepared by the AO in the presence of the witnesses and signed by such witnesses; but no witness shall be required to attend as a witness of the search in any proceedings under the Act unless specially summoned [Refer Rule 112(7)].
The occupant of the building/place/vessel/vehicle/aircraft searched and the person in charge of such vessel/vehicle/aircraft/some person on his behalf shall be permitted to attend during the search and a copy of the list prepared under Rule 112(7) shall be delivered to such occupant/person. A copy of the list shall be forwarded to the CCIT/CIT and where the authorization has been issued by any other officer also to that officer [Refer Rule 112(8)].
Where any person is searched u/s 132(1) (iia), a list of all things taken possession of shall be prepared and a copy thereof shall be delivered to such person. A copy of the list shall be forwarded to the CCIT/CIT and where the authorization has been issued by any other officer also to that officer [Refer Rule 112(9)].
The AO shall place the bullion/jewellery/other valuable articles and things seized during the search in a package which shall be listed with details of the bullion/jewellery and other valuable articles and things placed therein; every such package shall bear an identification mark and the seal of the AO/any other income-tax authority not below the rank of ITO and the occupant of the building/place/vessel/ vehicle/aircraft, including the person in charge of such vessel/vehicle/aircraft, searched or any other person in his behalf shall also be permitted to place his seal on them [Refer Rule 112(10)]
The AO may pass on/deposit the books of account/other documents/package/money seized to the office of any income tax authority not below ITO (Custodian) [Refer Rule 112(11)]
The Custodian shall take steps for the safe custody of books of account/other documents/package passed on to him. For safe custody of the package the Custodian may deposit the package with any branch of the RBI/SBI/authorized bank/Government Treasury. The Custodian may credit/remit the money through the nearest branch of the RBI/SBI/authorized bank for being credited in the Personal Deposit Account of the CCIT/CIT in the branch of the RBI/SBI/authorized bank at the place where the office of the CCIT/CIT is situate [Refer Rule 112(12)].
The person from whose custody any books of account/other documents are seized u/s 132(1)/132(1A) may make copies/extracts thereof in presence of the AO/other person empowered by him in this behalf at such place and time as the AO may appoint in this behalf [Refer Section 132(9)]
On being requisitioned by the AO, the Custodian shall deliver the package to the AO whenever it is required to be opened for the purposed of the Act. The AO may break any seal and open such package in presence of two respectable witnesses after giving reasonable notice to the person from whose custody the contents were seized to be present. The person shall be permitted till all the contents of such package are placed in a fresh package and sealed or delivered to such person/the Custodian [Refer Rule 112(13)].
If the AO has no jurisdiction over the person searched then the AO shall hand over the books of account/other documents/money/bullion/jewelley/other valuable article/thing seized to the jurisdictional Assessing Officer within sixty days from the date on which the last of the authorizations for search was executed and thereupon the powers exercisable by the AO u/s 132(8)/132(9) shall be exercisable by such Assessing Officer [Refer Section 132(9A)]

159
adbasavaraj on April 06 2015 20:19:07

very informative

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