Can the authorised officer break open the lock of the door during the course of income tax search proceedings?
1. Authority under the Act:
If during a search or seizure operation, the authorized officer is unable to obtain the keys to a door, locker, safe, almirah, or any other receptacle, they have the legal authority to break open the lock to access the items or premises (Sec 132(1) of Income Tax Act)
This is permitted to ensure that the officer can effectively carry out the search and seizure as per the warrant issued.
2. Caution:
A. Search warrant:
However it is importantly that the officer must be acting under a properly issued search warrant by a higher authority (e.g., Principal Director General or Principal Chief Commissioner).
B. Panchnama:
i. A Panchnama (document recording the search) is mandatory. It includes details of:
The search process, items seized or accessed after breaking locks and signatures of witnesses (panchas) present during the operation.
ii. The Panchnama is the most appropriate document to record the fact of breaking locks during an income tax search and seizure operation.
3. Does procedural lapses in Panchnama (for eg: not mentioning the fact of breaking of lock) affect the validity of a search?
Delhi High Court in case of MDLR Resorts (P.) Ltd. v. CIT [2013] 40 taxmann 365/[2014] 221 Taxman 83/361 ITR 407wherein the assessee challenged the search action consequent assessment to certain procedural defect in the panchanama drawn, held that though there is certainly lapse and failure to comply with the requirements of search and seizure manual but this would not affect the validity of the search.
4. Precedents set by ITO v. Seth Brothers [1969] 74 ITR 836 (SC):
The powers conferred under Section 132 are drastic and extraordinary, intended to tackle tax evasion. These powers must be exercised strictly in accordance with the law and are subject to procedural safeguards.
If the search is conducted arbitrarily, with a malafide intention, maliciously, or without proper authorization, it would be considered illegal.
Minor procedural irregularities, such as errors in the Panchnama or inventory, do not invalidate the search if the substantive requirements of the law are met.