Section-250: Application of seized or requisitioned assets

Section-250 seeks to provide for application of seized or requisitioned assets under the provisions of the proposed legislation. Learn to understand the section-250 as it is, it's help and useful links to follow.

Here onwards, "Act" refers to "Income Tax Act 2025"

1. Section-250 as per act

The Assessing Officer may recover the tax liability (including penalty or interest payable other than advance tax) out of the assets seized under section 247 or requisitioned under section 248, and such liability shall be the aggregate of––
1. any existing liability under this Act, or under the Income-tax Act, 1961 or the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015;
2. any liability determined under this Act or under the Acts referred to in clause (a), up to the date of completion of the assessment or reassessment or recomputation in consequence to the search or the requisition;
3. any liability in respect of which such person is in default or deemed to be in default under this Act or under the Income-tax Act, 1961, determined on or after the completion of the assessment or reassessment or recomputation in consequence of the search or the requisition, and till the date of release of the assets; and
4. any liability arising on an application made before the Interim Board of Settlement under section 245C(1) of the Income-tax Act, 1961.
The Assessing Officer may release the assets seized or portion of such asset to the person from whose custody the assets were seized, on an application made by the person concerned within thirty days from the end of the month in which the asset was seized, after fulfilment of the following requirements:––
1. satisfying himself about the nature and source of acquisition of any such asset;
2. recovering any existing liability referred to in sub-section (1);
3. obtaining prior approval of the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner.
The assets referred to in sub-section (2) shall be released within one hundred and twenty days from the date on which the last of the authorisations for the search or requisition was executed.
If the assets consist solely of money, or partly of money and partly of other assets, the Assessing Officer may apply such money in the discharge of the liabilities referred to in sub-section (1) and the assessee shall be discharged of such liability to the extent of the money so applied.
The assets, other than money, may also be applied for discharge of liabilities referred to in sub-section (1) as remains undischarged and shall be deemed to be under distraint as if such distraint was effected by the Assessing Officer or Tax Recovery Officer under authorisation from the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner and the recovery of any liability out of such assets shall be effected in the manner as prescribed.
The mode of recovery of liabilities under sub-section (1) shall not preclude the recovery of liabilities aforesaid by any other mode laid down in this Act.
Any assets or proceeds thereof, which remain after the liabilities referred to in sub-section (1) are discharged shall be forthwith made over or paid to the concerned person.
The Central Government shall pay simple interest at the rate of 0.5% for every month or part of a month for the period on the amount determined in accordance with the following formula:–– (A-B)+(C-D)

where —

A = the aggregate amount of money seized under section 247 or requisitioned under section 248;

B = the amount of money, if any, released under sub-section (2);

C = the proceeds, if any, of the assets sold towards the discharge of the liability under sub-section (1); and

D = the aggregate amount required to meet the liabilities referred to in sub-section (1).
The interest referred to in sub-section (8) shall run from the date immediately following the expiry of one hundred and twenty days from the date on which the last of the authorisations for the search under section 247 or requisition under section 248, was executed to the date of completion of the assessment or reassessment or recomputation.