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Overview of Search and Seizure and Survey Provisions Under Income Tax Act 1961 with Relevant Provisions of Indian Evidence Tax Act Presented By Ram Krishna Gupta CCIT (CCA),Nagpur Mumbai. NATURE OF POWER UNDER SECTION 132 .
Overview of Search and Seizure and Survey Provisions Under Income Tax Act 1961 with Relevant Provisions of Indian Evidence Tax Act
Ram Krishna Gupta
CCIT (CCA),Nagpur Mumbai
19 ( 1g) of the constitution. In this year section 133A was also introduced giving power of survey.
A: Information-outside the department: Professional informers, business or professional rivals, disgruntled employees, unhappy wife, estranged brothers or a disgruntled son-in-law or a harassed daughter-in-law etc., within the department (CIB,AIR,ITS,AO etc.) and outside the department (FIU, Police, NIA, Directorate of Enforcement, custom and excise, Narcotics, sales tax etc)
B : Information of Hawala Transactions :
1. Bogus Purchases / Expenses
2. Bogus Cash Credits
3. Bogus Capital Gains
4. Foreign Bank Accounts
C Information gathered during search of third party or associates
QUASI JUDICIAL PROCEEDINGS-MEANING
A. Investigation and collection of incriminating evidence and relevant facts and their verification, examination (Police inspector role-administrative)
B. Issuing of show cause notice to the assessee after charges are framed (ie prosecutor’s role - to file charge sheet before the trial court- administrative )
C. Appreciation and evaluation of the evidences collected by him and explanation and evidences filed by the assessee (Judge’s Role)
Nature of I-T proceeding
Nature of Enquiry
Conditions of surrender under section 132(4) r.w.s 271AAB
The Gauhati High court in_Green_View-Restaurant. vs. Asstt. CIT (2003) 185 CTR (Gau) 651 dismissed the contention advanced by the assessee as to recording of statements by using force and coercion when the statements were recorded in the presence of two witnesses and the retraction was after lapse of time.
The assets seized shall be dealt with in the following manner
i) Seized assets may be applied towards existing and future liability (sec 132B(1)(i)
ii) Release of seized asset after meeting existing liabilities in certain cases 132B(1)(ii),
iv) Assets other than money may also be applied to discharge liabilities (sec 132B (1)(iii)
Return of excess assets seized (section 132B(3)
Can be issued. Arti Gases v. DIT (Inv.)  248 ITR 55 (Guj.)
Can not be issued:Arjun Singh & Another v. Assistant Director of Incometax (Investigation) 246 ITR page 363(MP) ; Dr. Balkrishnan Nair v. CIT reported in 154 CTR page 543(Kerela )
Indian Evidence ACT
•A document means;
•any matter expressed (written)
•on any substance
•in letters; figures or marks.
•Documentary evidences are;
• either primary (original) evidences or
• secondary (copies) evidences.
Following are relevant but not sufficient evidence:
•Duty of proving a fact
•Carries definite meaning
•Burden is fixed
•Onus is ambulatory
•Extent of onus can shift & re-shift
•Degree of proof required
•First ; what is apparent is believed to be true.
•Second ; what is believed to be true can be proved with evidence to be false.
•Third ; the person seeking to counter the apparent truth has to lead evidences.
•Fourth ; law can shift the burden of proof on the assessee to prove that apparent is real.
•Fifth ; evidence gathered behind the back of the assessee cannot be used unless an opportunity of rebutting same is given
•Sixth ; the rules of Natural Justice shall apply in admission of the evidence ; an opportunity of hearing and cross examination : a must.
•Seventh; evidences not produced can be produced before the appellate authorities on a written application.
•Eighth ; statement made on oath is binding but not conclusive
(a) An entry or memorandum made by him in books kept in (i)the ordinary course of business ,or (ii) the discharge of professional duty: or
(b) An acknowledgement (written or signed by him)of the receipt of money, goods, securities or properties of any kind .or
(c) Documents used in commerce, written or signed by him. or
(d) The date of a letter or other document usually dated ,written or signed by him,
The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case.
(e)that judicial and official acts have been regularly performed;
69, 69A, 69B and 69C.
Burden to prove that apparent is not real will depend on the facts of the case.
1. Burden is on the assessee where the Department alleges that apparent is not real. Sumati Dayal vs. CIT (1995) 214 ITR 801 (SC), The test of human probabilities influenced.
2. Burden is on the party who claims it to be so that the apparent is not the real. Daulat Ram Rawatmull's case_(1973) 87 ITR 349 (SC),.
3. The Supreme Court, once again, laid burden on the Department in the subsequent case of Kishinchand Chellaram vs. CIT (1980) 19 CTR (SC) 360 : (1980) 125 ITR 713 (SC)
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