Application of seized or requisitioned assets - Section 132B - Income Tax - Ready Reckoner - Income Tax

Application of seized or requisitioned assets - Section 132B The assets seized u/s 132 or requisitioned u/s 132A may be dealt with in the following manner, namely:- The amount of existing liability under the Income-tax Act, the Wealth-tax Act, the Gift-tax Act, and the Interest-tax Act, 1974 , the Interest-tax Act, 1974 and the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 [w.e.f. 01.10.2024 substituted vide Finance (No. 2) Act, 2024 ] ( existing liability shall not include advance tax.) and the amount of liability determined on completion of assessment or reassessment or re-computation or under Chapter XIV B for the block period and the assessment of the assessment year relevant to the previous year in which search is initiated or requisition is made (including any penalty levied or interest payable in connection with such assessment or reassessment) and May be recovered out of such assets The money seized shall first be used for discharging the above liabilities. If money fails short, then assets may be sold for discharging the above liabilities. Provided that where the person concerned makes an application to the Assessing Officer within thirty days from the end of the month in which the asset was seized, for release of asset and the nature and source of acquisition of any such asset. Provided further that such asset or any portion thereof as is referred to in the first proviso shall be released within a period of 120 days from the date on which the last of the authorisations for search u/s 132 or for requisition u/s 132A , as the case may be, was executed. Interest to be paid on seized money - The Central Government shall pay simple interest @ 0.5% for every month or part of a month on the amount by which the aggregate amount of money seized u/s 132 and 132A , as reduced by the amount of money released under the first proviso to section 132B(1)(i) and aggregate of the amount required to meet the liabilities referred u/s 132B(1)(i) . [ Section 132B(4)(a) ] The interest shall be payable for the expiry of the period of 120 days from the execution of the last of the authorizations for search till date of completion of assessment or re-assessment or re-computation. [ Section 132B(4)(b) ] Note:- Even though interest u/s 132B upto the date of framing assessments had been paid, interest on refund u/s 244A , for period after completion of assessments was also payable, as provisions are not overlapping. [ Gurvinder Singh v DIT (Investigation) 2013 (11) TMI 1441 - ALLAHABAD HIGH COURT ]