Search, Seizure and Survey: Sections 247 and 253

The Income-tax Act gives the department strong powers to uncover concealed income. A search allows officers to enter premises, break open locks and seize books, money and valuables; a survey allows a more limited inspection of business premises. Because these powers intrude on privacy and property, the Act conditions them carefully. This note covers search and seizure under section 247, survey under section 253 and the block assessment that follows a search.

1. Search and Seizure: Section 247 (old s.132)

• Conditions. The specified authority must have, in consequence of information in his possession, reason to believe that a person has failed or would fail to produce books or documents on summons or notice, or possesses money, bullion, jewellery or other valuables representing wholly or partly undisclosed income.
• Powers. The authorised officer may enter and search any building, place, vessel, vehicle or aircraft, break open locks, seize books, documents and valuables, place marks of identification, and make an inventory; the 2025 Act extends the power expressly to virtual digital space.
• Statements on oath. Any person found in possession of books or assets may be examined on oath, and the statement may be used in evidence.
• Presumption. Books and assets found in a person's possession are presumed to belong to him and their contents to be true.
• Requisition, s.248. Where books or assets are in the custody of another authority, they may be requisitioned instead of searched for.
• Reasons, s.249. The reason to believe recorded for authorising a search is not to be disclosed to any person or authority.

2. Survey: Section 253 (old s.133A)

Figure 1: Search and survey compared

A survey allows an income-tax authority to enter any place where a business or profession is carried on, or where its books, cash or stock are kept, ordinarily during working hours. The officer may inspect books, verify cash and stock, and record statements. No seizure is allowed, though books may be impounded with approval. Because statements during a survey are not recorded on oath, courts have treated them as having limited evidentiary value on their own.

3. Block Assessment after Search

Figure 2: Sections 292 to 299 (searches from 1 September 2024)

For searches initiated on or after 1 September 2024, undisclosed income is assessed under a separate block assessment scheme, carried into sections 292 to 299 of the 2025 Act. The block covers the six years before the year of search and the part of that year up to the date of search. Undisclosed income found is taxed at a flat special rate, and searches are no longer dealt with through reassessment (Topic 21).

4. Leading Cases

Figure 3: Constitutionality and limits of search

• Pooran Mal v Director of Inspection (1974). A Constitution Bench upheld the search and seizure provisions as reasonable restrictions, and held that evidence obtained in an illegal search is not inadmissible on that ground alone, since Indian law has no exclusionary rule.
• ITO v Seth Brothers (1969). The search was upheld, but the Court made clear that the power to seize extends only to books and documents relevant to proceedings under the Act.

5. Frequently Asked Questions

Can money be seized during an income tax survey?

No. A survey under s.253 allows inspection, verification of cash and stock, and recording of statements, but not seizure. Books of account may be impounded with approval. Seizure requires a search under s.247.

Must the reasons for a search be disclosed to the assessee?

No. Section 249 provides that the reason to believe recorded for authorising a search shall not be disclosed to any person or authority, though courts may examine the record when the search is challenged.

Is evidence found in an illegal search admissible?

Yes. In Pooran Mal v Director of Inspection (1974), the Supreme Court held that Indian law has no rule excluding evidence merely because it was obtained through an illegal search, though the illegality may affect the weight given to it.

What period does a block assessment cover?

For searches initiated on or after 1 September 2024, the six tax years before the year of search and the part of the year of search up to the date of search.

6. Related Topics

• Topic 17: Income from Other Sources. Unexplained income.
• Topic 21: Reassessment. Why search cases were separated.
• Topic 25: Penalties and Prosecution. Consequences of concealment.