Search and Seizure

Tax and revenue authorities have significant powers of search and seizure, which authorize senior officials and others to delegate search and seizure responsibilities to sub-ordinate officers. This authority is activated primarily under circumstances where there is suspicion of non-compliance with summons or notices for the production of documents, possession of undisclosed income or property, or anticipatory non-cooperation in producing necessary documents. The powers granted are extensive, including the right to enter premises, break open locks, search individuals, and seize items believed to represent undisclosed income, with specific guidelines for handling business stock and valuable articles. Furthermore, these officers can mark documents, make inventories, and examine individuals under oath, emphasizing the need for careful legal guidance in these situations.

From a legal standpoint, it’s important to note that the seized items are subject to strict retention and release guidelines, and can be used to settle existing tax liabilities. The tax and revenue laws align these procedures with criminal and civil laws as well, granting tax authorities court-like powers in discovery, inspection, and compelling document production. Additionally, the Act specifies the process for issuing notices in cases of income suspected to have escaped assessment, including assessments of income for prior years preceding the search. As a specialist in this area of the law, Mahesh Kumar & Co. (MKC) is of the view that any person subjected to search and seizure action and consequential proceedings or those inherently vulnerable to such actions, must promptly access professional advice and representation, to ensure their rights and interests are adequately protected while navigating the complex procedural and substantive aspects of these tax provisions.