Treat seized cash as an advance tax during search

[Vikas Aggarwal]

Respected Sir,

Please help me in the following issues.

1. Search initiated on end of march2011in the premises of an assessee & seized cash of Rs. 45 lakh, asessee wrote a letter to department on august, 2011 & request to treat seized cash as an advance tax for the FY 2010-11. and show his seized cash as an advance tax in our computation, can department allowed to treat seized cash as an advance tax, if yes (please provide any case law (delhi high court/supreme court, if any) in this regard).

2. What is the situation if assessee booked a cash sale of Rs. 45 lakh in th above case.

 

Regards,

CA Vikas Aggarwal.

AI Summary

Can seized cash from a tax search be treated as advance tax? Section 132B requires application within 30 days. An individual sought advice on whether seized cash during a tax search could be treated as advance tax for the fiscal year 2010-11. The query involved a situation where Rs. 45 lakh was seized, and the assessee requested it be considered as advance tax. One response noted that until adjudication by the tax authority, the status of seized cash cannot change to advance tax. Another response referenced Section 132B of the Income Tax Act, suggesting that an application must be made within 30 days for the release of assets, which may then be used to settle liabilities.