1. Survey, Search & Seizure under Income Tax Act, 1961
Introduction.
The expression "survey" means general view, casting of eyes or mind over something,
inspection or investigation of the condition, amount, etc. of something, account given of
result of this etc.
In short the term 'survey' in context of the Income Tax Act means collection of data or
information for the purposes of the Act.
Search means to look out, to seek or to find something the presence of which is suspected,
etc.
Seize means to take possession of goods, contrary to the wishes of the owner or to take
forcible possession.
From the income tax point of view, in common parlance search is referred as RAID.
However, there is no such term as raid anywhere in income tax law.
Survey
Types of Survey
 Specific Survey under section 133A(1) - This is the survey of the business premises of
a taxpayer.
 Survey of Expenditure on Marriages, Parties etc. under section 133A(5) - In involves
collecting information regarding the nature and scale of expenditure incurred by a
person on functions, ceremonies and events such as Marriages, Birthday Parties etc.
 Door to Door Survey under section 133B - The object of survey is to locate new
assessees and thereby unearth black money. Persons who have been avoiding from
coming into the tax net are brought into the mainstream, through a shop to shop or
house to house survey.
Authorities competent to make survey
Authorities competent to make survey are Commissioner, Joint Commissioner,
Director, Joint Director, Assistant Director, Deputy Director, Assessing Officer and Inspectors
of Income Tax.
Powers of Income Tax Authority regarding survey
The Income Tax Authorities have been conferred the following powers under section
133A(3) -
 To enter the place of business during business hours and in other places only after
sunrise and before sunset.

2.  To enter the place, other than business premises, if the assessee states that his cash,
stocks, records and books of account relating to business are lying there.
 To place marks of identification on the books of accounts.
 To take extracts from such books of accounts and documents or records.
 To make an inventory of any cash, stocks and other valuables checked by him.
 To record the statement of any person.
 To collect information regarding nature and scale of expenditure incurred in
connection with personal functions and events like birthday, marriages etc.
 To impound or retain in his custody books of accounts or other documents inspected
by him after recording his reasons for doing so. It is further provided that such books
of account or other documents shall not be retained for more than fifteen days
without obtaining the approval of the Chief Commissioner of Income Tax or Director
General or Commissioner or Director therefrom
Restrictions on Income Tax Authority impound
 An Income Tax Authority can only enter a building or place where a business or
profession is carried on.
 Survey at premises where business or profession is carried on shall normally
commence during the business hours. It may however continue even after normal
business hours. At any other place it shall commence after sunrise and before
sunset.
 The Income Tax Authority cannot impound or retain cash, stock or other valuable
articles of the assessee.
 Premises cannot be sealed during Survey [ Shyam Jwellers vs. Chief Commissioner
Administration (1992) 196 ITR 243 (All).]
Rights of Person Present in the Premises
 To verify the identity of the officials intending to carry out the survey.
 If the survey is proposed to be carried out by an Inspector of Income Tax, to verify
the authorization and to check that the name and address of the premises and the
name of the inspector are correctly mentioned.
 To ascertain that the officer who has authorised the survey has jurisdiction over the
case or over the premises.
 To consult and be defended by a legal practioner of his choice as per article 22(1) of
the Constitution. The counsel may also be present during survey
proceedings[Nandini Satpati vs. P.L. Dasi AIR 1978 SC 1025]
Duties of Person Present in the premises
He should provide the Income Tax Authority following facilities -
 Facility to inspect books of accounts and documents.
 Facility to inspect cash, stock and other valuable articles.
 Facility to inspect books of accounts and documents.
 To furnish such information as may be required in any other matter, which may be
useful in proceedings of the Income Tax Act.

3.  Offer clarifications that may be necessary.
When Survey is converted into Search
Proceedings under Section 133A, 133B and 132 are independent of each other. The
object and scope of action under each of these actions is well defined. A survey can lead
to search only when on the basis of the information collected in survey; conditions laid
down in clause (a), (b), (c) of Section 132 (1) are satisfied. Similarly persistent failure on
the part of the assessee to show cooperation with the Income Tax Authorities in the
matter of survey may also result into income tax raid leading to search and seizure.
Search and Seizure
Search operations are exploratory exercise on the basis of information with the
income tax department to find hidden income and wealth in cases of tax payers, who have
not disclosed their true financial state of affairs in discharge if their tax obligations.
Seizure implies taking possession of assets, which have not been disclosed to the
income-tax department and of accounts/documents, papers which contain details of
unaccounted wealth/income not disclosed to the income tax authorities.
Thus, search and seizure is a very powerful weapon in the armory of income tax
department to unearth any concealed income or valuables and to check the tendencies of
tax evasion thereby mitigating the generation of black money.
When and Why Search is conducted [Sec 132(1)]
The Income Tax authority has reasons to believe that -
 When any summon or notice issued to produce books of account or other
documents under section 131 or section 142(1) is not responded.
 When any summon or notice issued under section 131 or section 142(1) has been or
might be issued, assesse will not or would not, produce books of account or other
documents
 When competent authority forms belief that a person is having unaccounted income
in the form of cash, bullion, jewellery, etc on the basis of information in his
possession.
CBDT Guideline on search and seizure
- Search and seizure should be conducted in the rarest of the rare case.
- Minimum expected disclosure is of Rs. 100 Lacs.
- Professionals of high repute are not to be searched.
Authorization of Search and Seizure
- Director General or Chief Commissioner
- Director or Commissioner

4. - Additional Director or Additional Commissioner
- Joint Director or Joint Commissioner
However, search can be authorised by Additional Director or Additional Commissioner
or Joint Director or Joint Commissioner only if he is empowered by CBDT to do so.
How Search is conducted
 Authorization of search by issuing search warrant in form 45 of IT Rules.
 Entering into the premises to be searched by producing search warrant. Conducting
search in presence of atleast two withnesses.
 Preparing Panchnamas for each premise and person.
 Preparing inventories of cash/valuables/loose papers/ jewellery found and seized.
 Recording statements.
Panchnama is a vital document evidencing the conduct of search at a premise on the
day of search in the presence of atleast two withnesses whose signatures are taken on
the panchnaama. The panchnaama contains the name and address of the person
searched in whose respect search warrant has been issued. It is accompanied by
annexures. The person searched is entitled to obtain a copy of the panchnaama.
Recording of Statements during and after the search u/s 132(4). Statements have strong
evidentiary value and are binding on the person searched unless retracted on valid
grounds.
Rights and Duties of person searched.
Rights Duties
a. To check identity of each of the member
of search party.
b. To have authorised representative.
c. To have witnesses.
d. To search every person of search party
when they leave the place.
e. To call doctor for the ill person.
f. To send kids to school after verification of
their school bags.
g. Female to be searched by female only.
h. To have inventories of items found and
seized.
i. To use phones
j. To have copy of statements recorded.
k. To have copy of books and documents
seized.
a. To allow search party to enter the
premises without obstacles.
b.To sign search warrant.
c. To give explanation when asked
d.To restrict entry of any unauthorized
persons.
e. Not to move any items without permission
of search party.
f. To co-operate with search party.
Items which can be seized
During the course of search, the income tax officers conducting the search are empowered

5. to seize books of accounts, cash, jewellery, and other valuables such as FDs/RDs, shares
certificates. NSCs, hundies, promissory notes, title deed of immovable properties.
Item which cannot be seized
 Immovable assets
 Stock in trade.
 Items disclosed in returns.
 Items appearing in books of accounts
 Cash for which explanation can be given
 Jewellery mentioned in wealth tax return.
 Gold upto 500Gm per married woman, 250Gm per unmarried woman and 100Gm
per male member of the family.
 Jewellery as per the status of the family if so appear to investigation officer.
Deemed/Constructive Seizure [2nd Provisio to sec 132(1)]
Where it is not possible or practicable to take physical possession of any valuable article
or thing and remove it to a safe place due to its volume, weight or any other physical
characteristics or due to its being of dangerous nature, the authorised officer may serve
an order on the owner or the person who is in immediate possession thereof that he
shall not remove, part with or otherwise deal with it except with the previous
permission of such authorised officer and such action of the authorised officer shall be
deemed to be seizure of such valuable articles or thing.
Order of Restraint may be issued for reasons other than mentioned above, on the
owner or the person who is in immediate possession shall not remove, part with or
otherwise deal with it except with previous approval and such order cannot in force for
a period exceeding 60days
Examination on Oath [Section 132(4)]
The authorised officer may examine any person on oath during the course of search and
seizure, and such examination thereafter be used in evidence in any proceeding under
the act.
Presumption in course of Search and Seizure [Section 132(4A)]
Where any books of accounts, other document, money, bullion, jewellery and other valuable
article is found is the possession or control of any person in course of a search, it may be
presumed-
(i) That such items belong to such person
(ii) That the contents of such books of account and documents are true and
(iii) That the signature and every other part of such books of account and other documents
which purport to be in the handwriting of any particular person are in that person’s hand
writing, and in case of a document stamped, executed or attested, that it was duly stamped,

6. whom executed or attested by the person by whom it purports to have been so executed or
attested.
Period of retention of Books of account and other documents [section 132(8)]
The seized items shall not be retained by authorised officer for a period exceeding
30days from the date of the order of assessment or reassessment under section 153A
unless the reason for retaining the same are recorded in writing and approval of Chief
Commissioner or Commissioner is obtained.
Assessment procedure after search and seizure
Under Section 153A, the assessing officer is empowered to issue notice to the person
searched, requiring him to furnish return of income for six assessment years immediately
preceding the previous year in which search was conducted. It has also been provided that
pending assessment proceeding, if any, against the person searched shall abate. However, it
has to be borne in mind that it is only the pending assessment proceedings that shall abate
and not the pending appellate proceedings if any. Thereafter, on scrutiny of the return
furnished by the person searched for all six years comprised in search proceedings as per
the provisions of section 153A and going through the seized material, the assessing officer
commences assessment proceedings by issuing detailed notices/questionnaires. In the
initial stages of assessment, the assessing officer has to collect as many evidences and
documents as possible apart from the seized material in his possession. In search cases, the
assessing officer is required to make assessment of income in respect of seven years
including six years covered under search and the year in which search was conducted.
Time limit for completion of search assessments
The provision of section 153B provides time limit for completion of assessments after
search. Section 153B is a lengthy section divided into many sub sections, provisios and
explanations. According to the said section, in normal search cases, i.e. where reference to
transfer pricing officer is not made, for the six years covered under search, the time limit is
two years from the end of FY in which search was conducted and the for year in which
search was conducted, same time limit is applicable.
Assessment of a person other than the person searched.
Section 153C is a unique provision in itself in as much as it empowers the IT authorities to
conduct assessment proceedings even in case of a person who was not searched as if a
search has been conducted in his case also. This happen when during search at a premise,
some documents or valuables were found in respect of which there was apprehension that
they may belong to some other person. In such a case section 153A may be invoked against
that person by the IT authorities after recording reason for satisfaction and all the provisions
of section 153A shall apply as they apply in case of a person searched.
The time limit will be same as that of person searched or 1 year from the end of the

7. FY in which books of accounts or documents or assets seized are handed over under section
153C to the assessing officer having jurisdiction over such other person, whichever is later.
Conclusion
Survey, Search and Seizure under income tax law is a very vast subject in itself
consisting of various issues, considerations, procedural aspects and litigation. An attempt is
made in this article to give a brief overview or concept. Some of the aspects of the topic are
discussed in brief without going into Nitti gritty of complexity of law and litigation involved.