Section 132A — Requisition of Books, Documents and Assets Seized by Other Authorities

What Is Section 132A?

Section 132A(1) of the Income Tax Act, 1961 states: "Where the Director General or Director or the Chief Commissioner or Commissioner, in consequence of information in his possession, has reason to believe that — (a) any person to whom a summons or notice under sub-section (1) of section 131 or under clause (ii) of sub-section (1) of section 142 was issued to produce, or cause to be produced, any books of account or other documents has omitted or failed to produce, or cause to be produced, such books of account or other documents as required by such summons or notice; or (b) any person to whom a summons or notice as aforesaid has been or might be issued will not, or would not, produce or cause to be produced, any books of account or other documents which will be useful for, or relevant to, any proceeding under this Act; or (c) any assets represent either wholly or partly income or property which has not been, or would not be, disclosed for the purposes of this Act by any person from whose possession or control such assets have been taken into custody by any other officer or authority under any other law for the time being in force, then he may, by requisition in writing, authorise any Additional Director, Additional Commissioner, Joint Director, Joint Commissioner, Assistant Director, Deputy Director, Assistant Commissioner or Deputy Commissioner (hereinafter referred to as the requisitioning officer) to perform the functions of an Authorised Officer specified in sub-section (1) of section 132."

In plain language — when a Customs officer, police officer, ED officer, CBI, or any other government authority has seized assets from a person — and those assets are believed to represent undisclosed income taxable under the Income Tax Act — the PCIT, CIT, DGIT, or Director can issue a written requisition to the holding authority directing them to deliver those assets to the IT Department's Requisitioning Officer. The IT Department then uses those assets in income tax assessment proceedings — exactly as if they had been seized in a Section 132 search.

Which Agencies' Seizures Can Be Requisitioned Under Section 132A

Section 132A applies to assets seized by "any other officer or authority under any other law for the time being in force." This is a very broad definition — covering virtually every government agency that has seizure powers under any Indian law:

Three Conditions for Invoking Section 132A

Like Section 132, Section 132A also requires "reason to believe" — based on information in possession of the authorising authority. However, Section 132A has its own specific set of conditions — any one of which must be satisfied:

Who Authorises a Section 132A Requisition

Section 132A requisitions are authorised by the same senior-level income tax officials who authorise Section 132 searches:

What Can Be Requisitioned Under Section 132A

Section 132A(1) uses the language "books of account, other documents, money, bullion, jewellery or other valuable article or thing" — the same categories as Section 132. In practice, the following are typically requisitioned:

The Section 132A Requisition Process — Step by Step

1. Seizing Agency Reports the Seizure to IT Department: When Customs, ED, Police, or any other agency makes a significant seizure — they routinely share information with the Income Tax Department's Investigation Wing through inter-agency coordination mechanisms. The IT Department's Intelligence and Criminal Investigation (I&CI) directorate monitors such reports. Alternatively, the IT Department's own surveillance may identify that assets seized by another agency have income tax implications.
2. Investigation Wing Examines the Material: The IT Department's Investigation Wing reviews the seized material (typically from the seizing agency's reports and any available documents) to determine whether the assets represent undisclosed income. They assess: what is the quantum of cash / assets seized; who is the person from whose custody they were seized; what is that person's declared income history; does the asset quantum suggest undisclosed income? If the conclusion is affirmative — the case is put up to the authorising authority.
3. Authorising Authority Issues Written Requisition: The PCIT / CIT / DGIT / Director — based on the Investigation Wing's report and their own "reason to believe" — issues a formal requisition in writing (the Section 132A authorisation document) to the Requisitioning Officer. The requisition specifies: (a) the person whose assets are being requisitioned, (b) the seizing agency currently holding the assets, (c) the nature of assets to be requisitioned, (d) the legal basis (which of the three conditions under Section 132A(1) is satisfied).
4. Requisitioning Officer Approaches the Seizing Agency: The Requisitioning Officer (ACIT/JCIT/DCIT) presents the written Section 132A requisition to the head of the seizing agency / custodian of the assets — typically the Commissioner of Customs, the ED Zonal Director, the Police Officer in charge of the case, or the court if assets are held as case property. The requisition directs the seizing agency to deliver the specified assets to the Requisitioning Officer.
5. Transfer of Custody — Panchanama / Receipt: The seizing agency transfers the assets to the Requisitioning Officer — and a formal transfer document / receipt / panchanama is prepared documenting: what exactly was transferred, in what condition, on what date, by whom and to whom. The Requisitioning Officer takes formal custody of the assets on behalf of the IT Department.
6. Assets Used in Section 153A Assessment: Once the IT Department has custody of the requisitioned assets, they are treated exactly like assets seized in a direct Section 132 search. A Section 153A notice is issued to the assessee requiring returns to be filed for the preceding six assessment years. The requisitioned assets / documents form the basis of additions in the Section 153A block assessment. Unexplained income is taxed at 78% under Section 115BBE. Section 271AAB penalties apply. See our Section 132 guide for the full Section 153A assessment process.

Key Differences — Section 132 vs Section 132A

Section 271AAB Penalty in Section 132A Cases — Important Distinction

The Section 271AAB penalty structure in Section 132A cases is importantly different from Section 132 search cases — because there is no physical search of the assessee's premises under Section 132A, there is no Section 132(4) statement opportunity during the requisition itself:

The "Reason to Believe" Requirement — Judicial Scrutiny of Section 132A

Courts have examined Section 132A requisitions in significant detail — and several important judicial principles have emerged:

1. Information Must Pre-Exist the Requisition

The "reason to believe" must be based on information already in the possession of the authorising authority at the time the requisition is issued — not information gathered after the requisition. The authorising authority cannot issue a requisition first and then look for reasons to justify it. Courts have quashed requisitions where the IT Department issued the requisition based solely on the fact that another agency had made a seizure — without having specific information about the income tax implications of those assets.

2. The Three Conditions Must Actually Be Satisfied

Unlike Section 132 (where condition (c) — possession of undisclosed income — is most commonly invoked), Section 132A has specific three conditions and the authorising authority must be able to point to which condition is satisfied and why. Condition (c) (assets representing undisclosed income already in another agency's custody) is the most commonly used — but the authorising authority must specifically believe that the assets in the other agency's custody represent undisclosed income of the assessee, not merely that the assets were found from the assessee.

3. Assets Must Have Been in the Other Agency's Custody Lawfully

The other agency's original seizure must have been made under a valid law and their custody must be lawful. If the original seizure by Customs or ED was itself illegal or was subsequently set aside by a court — the IT Department's Section 132A requisition of those assets may also be challenged. Courts have held that Section 132A cannot be used to validate an otherwise unlawful seizure by another agency.

Section 132A and the Assessee — Practical Impact

From the assessee's perspective, a Section 132A requisition differs from a Section 132 search in several practically important ways:

1. No Advance Warning — But Also No Physical Intrusion

Like Section 132, there is no advance notice given to the assessee before a Section 132A requisition. The first time an assessee typically learns about a Section 132A action is when they receive the Section 153A notice from the IT Department — asking them to file returns for the preceding six years. There is no search party entering the premises, no panchanama being prepared at the house or office, and no officers recording statements on the day of the requisition itself. However, the assessee should be aware that any seizure made by another agency that involves significant cash, gold, documents, or assets is very likely to trigger a Section 132A requisition by the IT Department.

2. The Seized Material Becomes the Evidence

In Section 132A cases, the requisitioned material is the primary evidence for the Section 153A assessment. The AO will use: the cash seized (as proof of unexplained cash under Section 69A), the documents found (as proof of unrecorded transactions), the gold/jewellery (as unexplained investment under Section 69), and any statements made by the assessee to the original seizing agency (Customs / Police / ED) — as the basis for making additions in the Section 153A assessment.

3. Statements Made to Other Agencies Can Be Used

Statements made by the assessee to Customs officers, ED officers, or Police during the original investigation — under oath or otherwise — can be used by the IT Department in the Section 153A assessment. The Supreme Court has held that statements made to other government agencies are admissible in income tax proceedings. If the assessee admitted to Customs officers that the seized cash was unaccounted — that admission is available to the IT Department and the AO can rely on it in the Section 153A assessment. This is a significant practical consideration — what you say to any government agency investigating you has income tax consequences.

Legal Remedies Against Section 132A

1. Challenge the Requisition by Writ Petition Before High Court: The validity of the Section 132A requisition can be challenged in the jurisdictional High Court by a Writ Petition — on grounds that: (a) the authorising authority did not have "reason to believe" based on credible information at the time of requisition; (b) none of the three conditions of Section 132A(1) was actually satisfied; (c) the assets were no longer in the other agency's custody when the requisition was issued; (d) the authorisation was issued by an officer not empowered under Section 132A; or (e) the original seizure by the other agency was itself invalid. File the writ as early as possible — courts may grant stay of the Section 153A proceedings pending the writ if the grounds are substantial.
2. Challenge the Other Agency's Original Seizure: If the Customs / ED / Police seizure that triggered the Section 132A requisition was itself illegal — challenge it in the appropriate forum (Customs Appellate Tribunal for Customs seizures, High Court/Special Court for ED/PMLA matters). If the original seizure is set aside — the Section 132A requisition based on it may also fall. Coordinate the challenge across all relevant forums with a multi-agency specialist team.
3. Provide Explanation for Assets in Section 153A Proceedings: Even after the Section 132A requisition is executed — the assessee has the full opportunity to provide satisfactory explanations for the requisitioned assets in the Section 153A assessment proceedings. Cash that is explained from disclosed income / bank withdrawals; gold that is shown in balance sheets / wealth tax returns; documents that relate to legitimate business transactions — all of these can be explained to reduce the Section 153A additions. See our Section 132 guide for detailed guidance on Section 153A proceedings.
4. Challenge Section 153A Additions Without Incriminating Material: The Supreme Court has held that for completed assessments in the six-year block period, Section 153A additions can only be made on the basis of incriminating material found during the search or requisition. If the AO is making additions for years where the requisitioned material does not reveal any undisclosed income — challenge those specific additions in appeal before CIT(A) on the ground that no incriminating material pertaining to those years was found.
5. Apply for Release of Requisitioned Assets Under Section 132B: Section 132B applies equally to assets received under Section 132A requisitions. File a Section 132B application for release of the requisitioned assets — particularly cash (needed for business liquidity) and books of account (needed for conducting business). The release can be against payment of estimated taxes or furnishing of adequate security pending the Section 153A assessment.
6. Appeal Against Section 153A Assessment Order: Challenge the Section 153A assessment order through the full income tax appeals hierarchy — CIT(A) Appeal (Form 35) within 30 days → ITAT → High Court. Apply for stay of demand immediately — given that 78% tax + 60% penalty on undisclosed income can generate demands exceeding the asset value itself.

Section 132A — Quick Reference

Frequently Asked Questions (FAQs)