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SEARCH, SEAZURE & SURVEY UNDER INCOME TAX ACT

SEARCH, SEAZURE & SURVEY UNDER INCOME TAX ACT. ANUP VAISHNAV SURESH SURANA & ASSOCIATES. NOTES. __________________________________ __________________________________ __________________________________ __________________________________ __________________________________

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SEARCH, SEAZURE & SURVEY UNDER INCOME TAX ACT

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  1. SEARCH, SEAZURE & SURVEY UNDER INCOME TAX ACT ANUP VAISHNAV SURESH SURANA & ASSOCIATES SSA, SURAT

  2. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  3. 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 POST SEARCH PROCEDURES RECORDING OF STATEMENT AND DISCLOSURE ISSUANCE OF NOTICE, TAX PAYMENT & FILING OF RETURNS ASSESSMENT OF RETURNS FILED SURVEY CONTENTS SSA, SURAT

  4. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  5. 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

  6. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  7. 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

  8. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  9. 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

  10. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  11. Rights Right to check identity of each of the member of search party Right to have authorised representative Right to have witnesses Right to search every person of serch party when they leave the place To call doctor for the ill person To send kids to school after verification of their school bags Female to be searched by female only To have inventory of items found and seized To use phones To have copy of sttements recorded To have copy of books and documents seized Duties To allow search party of enter in premises without creating obstacles To sign search warrant To give explanation when asked Restrict entry of any unauthorised persons Move any items without permission of search party To Co Operate search party RIGHTS & DUTIES OF THE PERSON SEARCHED SSA, SURAT

  12. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  13. 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

  14. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  15. 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

  16. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  17. 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

  18. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  19. 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

  20. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  21. 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

  22. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  23. 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

  24. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  25. 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

  26. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  27. 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

  28. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  29. ASSESSMENT OF RETURNS FILED • Assessment procedures • Status of pending assessments • Areas which can be covered by the Assessing Officer • Tax Interest & Penalty SSA, SURAT

  30. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  31. SURVEY • What is Survey ? • How it defers from Search ? • How it is conducted ? • No seizures • Disclosure and Tax Payable SSA, SURAT

  32. NOTES • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ SSA, SURAT

  33. THANK YOU SSA, SURAT

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