Opinion Of Eminent Legal Luminaries On Controversial Issues

Whether A Proviso To S. 132(1)(iii) Is Applicable Retrospectively?

QUERY: Can the assessee get his stock in hand under seizure (lying with himself but under the seizure order) released in view of insertion of proviso to section 132(1)(B)(iii) w.e.f. June 1, 2003, though the search in his case was one before its insertion? The intent of this amendment proves that stock-in-trade should not be kept under seizure.
ANSWER: Firstly, it is not clear from the query, whether stock seized before June 01,2003 relates to a business. In case there are any items found from the possession of the assessee for which the assessee is not doing any business activity, the same can be seized in the hands of the assessee as valuable articles or thing and cannot be claimed to be in the nature of stock-in-trade.

Secondly, even if it is presumed that it was stock-in-trade of business seized before June 1, 2003 then, assessment and appeals could have been finalized.

Be that as it may, a proviso to s. 132(1)(iii) has been inserted by the Finance Act, 2003 w. e. f. June 1, 2003, so it cannot be said to have prospective effect as clarified by the CBDT vide cir. No. 7/2003 dated September 9, 2003.
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