CBDT CIRCULAR NO.2/2018 [F.NO.370142/15/2017-TPL], DATED 15-2-2018
52. Reason to believe to conduct a search, etc. not to be disclosed.
52.1 Sub-sections (1) and (1A) of section 132 of the Income-tax Act provide that where an authority mentioned therein, based on the information in his possession, has ‘reason to believe’ or ‘reason to suspect’ of circumstances referred to in the said sub-sections, he may authorize an authority specified therein to carry out search & seizure.
52.2 Similarly, sub-section (1) of section 132A of the Income-tax Act provides that the specified income-tax authority based on ‘reason to believe’ can authorise other income-tax authority mentioned therein to requisition from some other officer or authority to deliver books of account, documents or assets of the assessee to the income-tax authority so authorised.
52.3 Confidentiality and sensitivity are the hallmarks of proceedings under sections 132 and 132A of the Income-tax Act. However, certain judicial pronouncements had created ambiguity in respect of the disclosure of ‘reason to believe’ or ‘reason to suspect’ recorded by the income-tax authority to conduct a search under section 132 or to make requisition under section 132A of the Income-tax Act.
52.4 Therefore, an Explanation has been inserted to sub-section (1) and to sub-section (1A) of section 132 and to sub-section (1) of section 132A of the Income-tax Act to declare that the ‘reason to believe’ or ‘reason to suspect’, as the case may be, shall not be disclosed to any person or any authority or the Appellate Tribunal.
52.5 Applicability: These amendments take effect retrospectively from the date of enactment of the said provisions viz. to sub-section (1) of section 132 of the Income-tax Act from 1st day of April, 1962 and to sub-section (1A) of section 132 of the Income-tax Act and to sub-section (1) of section 132A from 1st day of October, 1975.