Limits on Section 132(4) statements prevent prosecution where oath and valid search proceedings are not established.

Section 132(4) of the Income-tax Act permits examination on oath only during search or seizure and only in relation to a person found in possession or control of the relevant assets or records. Where a statement was recorded before the search commenced and the material did not clearly establish that the person was examined on oath, the statutory foundation for offences under Sections 181 and 193 IPC was not shown. On that footing, the complaint failed to disclose the ingredients of the alleged offences at the threshold and process was not warranted.

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Issues: Whether the complaint disclosed a prima facie case for prosecution under Sections 181 and 193 of the Indian Penal Code on the basis of a statement recorded during search proceedings under Section 132(4) of the Income-tax Act, 1961, and whether process ought to have been issued.

Analysis: The power under Section 132(4) of the Income-tax Act, 1961 is confined to examination on oath during the course of search or seizure, and only in relation to a person found in possession or control of the books, documents, money, bullion, jewellery or other valuable article or thing. The statement in question was recorded before the search commenced, and the record did not clearly establish that the accused was examined on oath. The authorised officer therefore acted beyond the limited scope of Section 132(4), and the materials did not show beyond doubt that the alleged false statement was made on oath in the course of a valid proceeding. In those circumstances, the complaint did not disclose the ingredients of the alleged offences at the threshold.

Conclusion: No prima facie case was made out and refusal to issue process was justified.

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