Retention and Provisional Attachment of Assets Seized Under Search
Introduction
Section 132(8) empowers retention of books and documents seized during search until assessment is completed. Section 132(9A) mandates handing over seized material to the Assessing Officer within 60 days. Section 132(9B) provides for provisional attachment of property for six months to safeguard revenue. Section 132(9D) authorises reference to a valuation officer for estimating the fair market value of seized property.
Retention and Release of Books or Documents [Sections 132(8) and 132(10)]
Books and documents may be retained until completion of assessment and other proceedings under the Act, subject to recording reasons and obtaining approval of higher authorities. The authorised officer may retain books for one month beyond the end of the quarter in which assessment or reassessment is completed without approval, according to prescribed timelines. Retention beyond this period requires written reasons and approval of higher authorities. The assessee may object to such extension before the Board under Section 132(10). Assessees may obtain photocopies of seized books under Section 132(9), though no statutory time limit exists for supplying such copies.
Time Limits for Retaining Books and Documents
Books may be retained up to the last day of the month following the quarter in which the assessment order under Section 143(3), 144 , 147 or 158BC is passed. Extensions require reasons recorded by the Assessing Officer and approval from authorities such as the Principal Chief Commissioner, Chief Commissioner, Principal Commissioner, Commissioner, Principal Director General, or Director General. Retention cannot exceed 30 days after completion of all proceedings under the Act.
Obtaining Copies of Books Seized [Section 132(9)]
The person from whose possession books or documents are seized may obtain copies for compliance, business operations, audit, or finalisation of accounts. No time limit is prescribed for providing copies, and delays are common. The need for statutory rationalisation has been acknowledged.
Handing Over Seized Books or Assets to Assessing Officer [Section 132(9A)]
As search operations are investigative, the authorised officer collecting evidence must transfer seized material to the jurisdictional Assessing Officer within 60 days from execution of the last authorisation. Thereafter, powers relating to retention and supplying of copies are exercised by the Assessing Officer. Materials belonging to other persons must also be routed to the jurisdictional Assessing Officer of the person searched, who then transfers them to the appropriate Assessing Officer.
Provisional Attachment of Property [Sections 132(9B) and 132(9C)]
The authorised officer may order provisional attachment of property to protect revenue interests. Such order may be passed during the search or within 60 days after execution of the last authorisation, with reasons recorded and prior approval of higher authorities. Provisional attachment remains valid for six months and cannot be extended. After six months, jurisdiction typically passes to the Assessing Officer, who may exercise powers of provisional attachment under Section 281B.
Attachment of Disclosed Assets
Section 281B allows provisional attachment of any property, including disclosed assets, during assessment proceedings. As the power under Section 132(9B) parallels Section 281B, authorised officers may also attach disclosed assets such as bank accounts or stock-in-trade to protect revenue.
Valuation of Seized Assets [Section 132(9D)]
For accurate estimation of undisclosed income represented by investments or property, the authorised officer may refer the matter to a valuation officer under Section 142A. The valuation officer must furnish the report within 60 days. This valuation report is forwarded along with the appraisal report for use in assessment.