The movie thriller, Special 26 focussed on the concept of raids. The plot revolved around a group of conmen posing as Central Bureau of Investigation (CBI) officers and swooping down on terrified targets before doing away with their ill-gotten gains.
With raids still continuing to fascinate the common man who has formed an impression of raids from celluloid -- plenty of hi-octane drama, action, screeching cars and officers bursting into homes and tearing up furniture and breaking ceilings till a stash of cash rains down on their heads, former Income Tax Chief Commissioner Prakash Dubey clears the air and talks about the reality of raids. With more than 30 years in the Income Tax Dept., Padma Shri Dubey led a number of raids during his tenure.
Q The mention of a raid arouses a fascination, an intense curiousity in people...
That is because a raid is a rare occurrence. People from the salaried class would very, very rarely experience a raid, unless of course, a company is being raided and certain employees in key positions like the accountant or others are caught up in the raid.
Q: Most people have never seen a raid in progress. Their perceptions may be skewed based on fiction rather than fact...
I must stress here that, it is very, very important to make a difference between a ‘survey’ and a ‘Search & Seizure’ (S & S) operation. There is Section 132 of the Income Tax Act, which deals with S & S action. While under Section 133A one can conduct a ‘survey’ not an S & S. Very often, both these are confused even by the media. We read reports and television ‘breaking news’ screaming about a raid being conducted but many times, it is a survey. Sometimes, post weddings, or some kind of lavish spending on some occasions, the IT dept does conduct a survey to ascertain how expenses were met. In a ‘survey’ we cannot enter residential premises. In an S & S operation, we can. In an S & S the department is entitled to seize documents, jewellery, things of value or anything incriminating.
Q: Does the Income Tax Dept. have waysof finding out if an individual or company has expenditure way beyond the declared income?
Yes, we have an investigation wing with the department itself. We also have certain informants. Many times, we get information from individuals who may have a grudge against another, they may want to settle a score. This happens very often.
Q: So, an income tax raid is nothing really like what we see in the movies, lots of spills, thrills, fast cars screeching to a halt, officers bursting into homes... (laughs). First of all, a little background -- we need a warrant of authorization to conduct an S & S operation. Then, the team of income tax officers usually does not announce its arrival in a flamboyant fashion. The prime element in a raid is the surprise element and that would be compromised if we resort to such methods.
That does not mean though that raids always go smoothly or without drama. Some time in the 1970s we stumbled upon information that a lady had bought a very substantial amount of jewellery and she had no ostensible source of income. Before conducting any kind of operation, I sent a lady income tax officer as a saleswoman to the South Mumbai building. She engaged the security guard in conversation, eliciting some information. Then, she went up to the home and rang the doorbell, pretending to be a saleswoman. With this we ascertained how the lady opened the side door and put a safety catch into place before talking to a person at the door.
In a day, we raided the place. Since we had gleaned information about how she opened the side door and put a safety catch in place, I, who was leading the raid was carrying an iron rod (wrapped in a newspaper) with me. We went up to the home, she opened the side door and we said “income tax”. Before she could shut the door, we slipped the rod into the side door hinge so that it could not shut it completely. If she had managed to close the door even for a few minutes, she would have had the time to hide/destroy something, so we could not allow that.
Q: A few other anecdotes that prove fact can sometimes be as thrilling as fiction...
I once led a raid at a residence in Malabar Hill. We asked the family to gather in the hall and sit down while we went about our work. A lady inspector was monitoring four rooms with the help of a mirror. Suddenly, she saw a lady from the family go into one of the bedrooms. She opened a cupboard, took out a roll of paper and threw it out of the window. It fell on to the roof of a parking lot below. She saw a boy clamber on to that roof and run away with the paper. Those were the days when there were no mobile phones, so I do not know how they coordinated this. Anyway, the inspector rushed up to me telling me what she saw, and I told the family that I need those papers back in five minutes or the police would be at the door. I got back the papers.
On another occasion, I remember we raided a smuggler’s home in the western suburbs in the city. It was emergency time when smugglers across the country were being raided. After a two-hour search, we found nothing. I was leaning on a windowsill going over things in my head, when suddenly the sill shook a little. I tapped on it and realized it was hollow. Then, we pulled it apart and there it was -- stacks of cash and papers stuffed in the cavity that was made to look like a windowsill. So, you see sometimes, even reality can match all the action you see in the movies...
Q: In the end, what would you like to say to people...
An income tax raid is an unusual event in a person’s life. We do not tear pillows and break furniture like is commonly portrayed. We have on specific information found things of value in false ceilings at homes. At times, a cupboard may have to be broken. Yet, nobody enjoys doing these things. A raid is traumatic for the officers too as after all, we are invading somebody’s private space. Naturally, nobody likes the taxman, but we are doing our job. With co-operation, both sides can go through this with dignity and a mutual respect for each other.
Dubey’s Special ChHabbIs this is for real
1. There should be an element of surprise which is fundamental to a raid.
2. The team should be absolutely sure it warrants a Search & Seizure operation.
3. Background checks must be thorough.
4. Sometimes, real life can be even stranger than the movies.
5. There is a difference between a Survey and a Search & Seizure.
6. The media needs to exercise restraint and know the difference between terminologies when reporting.
7. Somebody’s reputation and life may be at stake, one has to be very thorough.
8. In a Survey we do not have the authority to go into residences, in a Search & Seizure (S & S) we do.
9. A raid is an unusual event in a person's life.
10. A raid is traumatic for the person being raided and for those conducting the raid too.
11. The Income Tax department has ways in which to glean information beforehand.
12. This information is then checked and verified in different ways.
13. To resist the Income Tax is an obstruction to public duty.
14. Experience has shown that people resort to hiding unaccounted wealth in unusual places.
15. The Income Tax officers have lady inspectors with them when they raid a home.
16. They also have two or more independent witnesses with them during the raid.
17. As technology evolves, so will the way raids are conducted in the future.
18. When there is a raid ongoing, there is a restriction on movement and communication of those raided.
19. Children too, are often subjected to these restraints because people might send some information through them, if they are allowed to move out of the premises.
20. A raid is a physically and mentally tedious job.
21. The IT needs a warrant of authorization to conduct a Search & Seizure.
22. Since a raid is an unusual event, it is understandable that there is a lot of curiousity attached to it.
23. The slightest, small error can result in the entire S & S operation fizzling out.
24. Taxmen have received threat calls to their life.
25. Nobody likes the taxman but that is natural.
26. It is the duty of the officers to make the raid as less traumatic as possible, without compromising on their duty.
Finance Minister P Chidambaram (PC) had said the revenue department would send tax notices to 35,000 assessees shortly. PC had said the tax department has information about people’s expenditure patterns and their transactions. “You cannot hide any longer ... Therefore, the best policy is to admit your income and pay tax...,” he said, sounding a loud warning bell post-Budget.