The Central Board of Revenue (CBR) has made it mandatory for the sales tax officials to acquire warrant from the judicial magistrate prior to conducting search operation for acquiring record at places other than business premises.
The CBR has replaced Section 40 of the Sales Tax Act, 1990 through Finance Bill 2004 to curtail the discretionary powers of the sales tax officials.
Official sources said that the CBR has made it mandatory for the sales tax officials not to conduct raids without obtaining warrant from the magistrate. However, if the concerned magistrate refuses to issue warrant, the tax officials cannot carry out search.
When asked that whether the powers of judicial magistrates have been given to the sales tax officials under Finance Bill 2004, the CBR officials said that the powers have been reduced through involvement of magistrate. This is an enabling provision, which would help in creating a better environment for the traders and businessmen.
Similarly, the CBR has also amended law so that the Sales Tax Department could take help of the customs, central excise and police for recovery. The provision was already available in the Customs Act, 1969 and Central Excise Act 1944. But the customs or excise officials have never invoked the provision during the last many years. According to Section 51A "all officers of customs, central excise, police and civil armed forces and officers engaged in the collection of land revenue are hereby empowered and required to assist the officers of sales tax in the discharge of their functions under this Act".
Following is the text of the amendment made in Sales Tax Act pertaining to search warrant:
(25) For Section 40, the following shall be substituted, namely: -
"40. Searches under warrant- (1) Where any officer of sales tax has reason to believe that any documents or things which in his opinion, may be useful for, or relevant to, any proceedings under this Act are kept in any place, he may after obtaining a warrant from the magistrate, enter that place and cause a search to be made at any time.
(2) The search made under sub-section (1) shall be carried out in accordance with the relevant provisions of the Code of Criminal Procedure, 1898 (V of 1898)."