21. In section 131 of the Income-tax Act, with effect from the 1st day of June, 2011,—
(i) after sub-section (1A), the following sub-section shall be inserted, namely:—
"(2) For the purpose of making an inquiry or investigation in respect of any person or class of persons in relation to an agreement referred to in section 90 or section 90A, it shall be competent for any income-tax authority not below the rank of Assistant Commissioner of Income-tax, as may be notified by the Board in this behalf, to exercise the powers conferred under sub-section (1) on the income-tax authorities referred to in that sub-section, notwithstanding that no proceedings with respect to such person or class of persons are pending before it or any other income-tax authority.";
(ii) in sub-section (3), after the words, brackets, figure and letter "or sub-section (1A)", the words, brackets and figure "or sub-section (2)" shall be inserted.
Notes on Clauses:
Clause 21 of the Bill seeks to amend section 131 of the Income- tax Act relating to power regarding discovery, production of evidence, etc.
Under the existing provisions contained in section 131, certain income-tax authorities have been conferred the same power, as available to a Civil Court while trying a suit in respect of discovery and inspection, enforcing the attendance of any person, including any officer of a banking company and examining him on oath, compelling production of books of account and other documents and issuing commissions.
It is proposed to insert a new sub-section (2) in the aforesaid section to provide that for the purpose of making an inquiry or investigation in respect of any person or class of persons in relation to an agreement referred to in section 90 or section 90A, it shall be competent for any income-tax authority not below the rank of
Assistant Commissioner of Income-tax, as notified by the Board in this behalf, to exercise the powers conferred under sub-section(1) on the income-tax authorities referred to in that sub-section, notwithstanding that no proceedings with respect to such person or class of persons are pending before it or any other income-tax authority.
It is further proposed to amend sub-section (3), so as to empower the aforesaid authority as notified by the Board, to impound and retain any books of account and other documents produced before it in any proceeding under the Act.
These amendments will take effect from 1st June, 2011.
