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CMA Final · Direct Tax Laws and International Taxation · Survey, Search and Seizure

During a search under section 247 of the Income-tax Act, 2025, books of account are found in the possession of Mr. Dev Malhotra. Which presumption may be drawn under the section?

Where books of account are found in a person's possession or control during a search, it may be presumed that they belong to him and that their contents are true. This is a presumption, not conclusive proof of undisclosed income.

  1. AThe books belong to him and their contents are trueCorrect
  2. BThe books are conclusive proof of undisclosed income of the person
  3. CThe books belong to his employer, unless he proves otherwise
  4. DThe contents are presumed false until the person proves them true

Explanation

Section 247(7) says it may be presumed that books or documents found in a person's possession or control belong to that person and that their contents are true, along with presumptions on handwriting and execution. It is only a presumption, not conclusive proof, and it does not presume falsity or ownership by someone else.

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