LOK SABHA

The Income Tax Department, assisted by the Enforcement Directorate, has conducted searches and seizure operation recently in various States of the country. Various lockers, bank accounts and premises are under propitiatory orders as per the provisions of the Income Tax Act, 1961. The seized documents/materials are being further investigated.

The search actions in some cases, prime-facie, indicate Hawala transactions and that the properties are more than the income earned. Search and Seizure action, as per the Income Tax Act, 1961, are a continuous and ongoing process based on information in the possession of the Income Tax Department. The evidences gathered during search and seizure actions are used in assessment or re-assessment proceedings of the relevant persons, as per Income Tax Act, which becomes final when assessments before the Assessing Officer and appeals before CIT (Appeals), ITAT, High Courts or Supreme Court are completed. Suitable action as per law would be taken against those found guilty.

This information was given by Minister of State for Finance, Shri S.S. Palanimanickam in written reply to a question raised in Lok Sabha today.

Income tax search and seizure: evidence from operations informs assessment and appeals and shapes final legal consequences. Searches and seizures under the Income Tax Act, assisted by another enforcement agency, targeted lockers, bank accounts and premises under proprietary orders; seized materials are under investigation, with some prima facie indications of hawala transactions and properties exceeding declared income. Evidence from these operations is used in assessment and reassessment proceedings and attains finality only after completion of assessments and appeals, after which appropriate legal action may follow against those found culpable.