Regarding search u/s 132, possession of wealth, jewellery, issuance of notice u/s 142(2) - Income Tax - 497/CBDT

INSTRUCTION NO. 497 / CBDT Dated : January 17, 1973 Section(s) Referred: 14(2) Statute: Wealth Tax Act, 1957 The Board have noticed that during the searches conducted u/s.132 of the I.T.Act a substantial amount of unexplained jewellery as well as assets held in the shape of immovable properties have been discovered. These assets were alleged to be owned by individuals/partners/coparceners, who though assessed to income-tax, were not wealth-tax assessees, although on the basis of the assets discovered they should have been assessed to wealth-tax, Section 69A of the I.T.Act deems the value of unexplained jewellery or other valuable assets found in any financial year to be the income of that financial year. It would be possible to show that the jewellery etc. are unexplained if the assessee can be committed in advance regarding the items of jewellery etc. in his possession and the market value thereof. The Board therefore, desire that whenever, in course of the examination of accounts, the ITOs find that any individuals, specially ladies, possess assets including immovable property of the back value of about Rs.80,000/- they should issue a notice u/s.14(2) of the W.T.Act to the persons concerned to ensure that they do not escape assessment to wealth-tax and also simultaneously remain committed to ownership of particulars type and value of assets including jewellery.