Power of IT Authorities to Conduct Survey in Premises of a CA Lawyer/Tax Practitioner of an Assessee
The IT authority does not assume any power to enter the business premises/Office of the CA/Lawyer/Tax Practitioner to conduct survey under section 133A of IT Act in connection with survey of the premises of their client unless the client state in the course of survey that his books of account/documents and records are kept in the office of his CA/ Lawyer/Tax Practitioner.
HIGH COURT OF ORISSA
U. K. Mahapatra & Co. v ITO (WP(c) No. 14018 of 2008) Date: October 29, 2008
7. So far as the first question is concerned, provisions of Section 133A make it clear that the place to which an income tax authority can enter should either be a place within the limits of the area under the jurisdiction of the said Income-tax authority or any place occupied by any person in respect of whom he exercises jurisdiction or any place in respect of which he is authorised for the purpose of the said section by such income tax authority who is assigned the area within which such place is situated or who exercises jurisdiction in respect of any person occupying such place. In either ease, the place should be one where the business or profession of assessee is carried on. It is immaterial whether the place of business is the principal or additional or subsidiary place of business of profession of a person in respect of whom survey under section 133A is intended. However, explanation below Sub-section (1) of section 133A of the I. T. Act clarifies that a place where business or profession is carried on shall also include any other place whether any business or profession is carried on therein or not in which the person carrying on business or profession states that any of his books of account or documents or any part of his cash or stock or any other valuable article or thing relating to his business or profession are of is kept. Thus at the time of survey, if the concerned person states that any of his books of account or documents or any part of his cash or stock or any other valuable article is or are kept in the office of his Chartered Accountant or Advance or Income-tax Practitioner the Survey Officer can enter such office for the limited purpose of inspecting those books of account or other documents. Similarly if the concerned person states at the time of survey that his books of account or documents or cash or stock or any other thing/article relating to his business or profession are kept in his residential premises or in the premises of some other person, the Survey Officer can enter those premises for the limited purpose of inspecting those books of account or other documents or cash or stock or any other article or thing relating to the business or profession of such person. Thus, the precondition for conducting survey U/s 133A in the premises of a Chartered Accountant, lawyer, Tax Practitioner in connection with survey of the business place of their client is that the client in course of survey must state that his books of account/documents and records are kept in the office of his Chartered Accountant /Lawyer/Tax practitioner. Unless this precondition is fulfilled, the I.T. authority does not assume any power to enter the business premises/office of the Chartered Accountant lawyer/Tax Practitioner to conduct survey under Section 133A of I.T. Act in connection with survey of the premises of their client
In the present case, the counter affidavit and additional counter affidavit filed by opposite parties do not reveal that anybody on behalf of M/s Serajuddin & Co. and group in whose case survey under Section 133A was carried on has stated that their books of account were kept in the premises of the petitioner-Chartere d Accountant No such statement of M/s Serajuddin and Cc. or Group was also produced before this Court in course of hearing. In absence of any such statement, the opposite parties lack jurisdiction to enter the premises of the petitioner-firm and conduct the survey under Section 133A of I.T. Act. The submission of Mr.Mohapatra, learned counsel for?-Income Tax Department that survey under Section 133A was conducted in Rot No.237, Bapuji Nagar, Bhubaneswar as additional place of business of M/s Serajuddin & Co. and Group for which any such statement was not necessary is contrary to the materials available on record. In paragraph 2 of the counter affidavit opposite parties 2 and 4 have admitted that a survey under Section 133A has been conducted in the premises of M/s U. K. Mohapatra & Co., Hot No. 237, Bapuji Nagarf Bhubaneswar in connection with search and seizure operation in case of M/s Serajuddin & Co. and group. Annexure-2 shows that the Survey Officer has impounded books of account/loose sheet bundles in course of survey under Section. 133A of the I.T. Act in the business, premises of M/s U.K-Mohapatra & Co. on 28.05.2008. Further, pursuant to the petitioner’s letter dated 16.06.2008 (Annexure-3) for release of books of account/loose sheet bundles, O.P. No. l vide his letter dated 23.06.2008 (Annexure-4) intimated the petitioner that survey operation under Section 133A of the FT Act was conducted in his premises on 28.05.2008 as per the existing provisions of law. In Annexure-C/2, O.P. No. l recorded reason for impounding the books of account/documents which also reveals that he conducted survey under Section 133A of the IT Act in the business premises of M/s U. K. Mohapatra & Co. There are other documents as Annexure-H/2 dated 11.06.2006; Annexure- 1/2 dated 23.09.2008; and Annexure-J/2 to the coulter affidavit, which also reveal that opposite parties conducted survey under Section 133A in the business premises of the petitioner.
Therefore, in the present case, survey conducted in the premises of the petitioner-Chartered Accountant under Section 133A is without authority of law.