Examine the correctness of the actions taken by the authorized officer with regard to cash, antique idol, inventory in show room and silver bars…

Examination of each situation 1. 50 lakhs cash kept in the director's office Provision applied: Section 132 (1) (iii) . The authorized officer can seize cash found during the search if he has reason to believe that it represents undisclosed income or property. Action justified: Correct. The seizure of cash is valid, as money is a seizable asset under section 132 (1) . 2. Gold ornaments worth 3crore (stock-in-trade) Provision applied: Proviso to section 132 (1) (iii) . When bullion, jewellery or other valuable articles or things are found and they form stock-in-trade of the business, they shall not be seized. However, the authorized officer shall prepare an inventory or note of such stock-in-trade of the business. Action justified: Correct. The authorized officer properly refrained from seizure and instead prepared an inventory. 3. Antique gold idol (personal possession of director) Provision applied: Section 132 (1) . Thia idol is not stock-in-trade and is of personal nature; hence, if it is suspected to be undisclosed property, it can be seized. Action justified: Correct. The seizure of the antique idol is lawful under section 132 (1) . 4. Silver hare stored in warehouse (impracticable to seize due to weight and volume) Provision applied: Second proviso to section 132 (1) . Where it is not practicable to take physical possession of any valuable article or thing and remove it to a safe place due to its volume, weight or dangerous nature, the officer may serve an order on the owner or the person in possession that he shall not remove, part with or otherwise deal with it without prior permission. Such an order shall be deemed to be a seizure for legal purposes (deemed seizure). Action justified: Correct. Since physical seizure was impractical, the authorized officer correctly issued an order under the second proviso to section 132 (1) . However, this deemed seizure does not apply to stock-in-trade, so it is valid only if the silver bars were not part of the stock-in-trade of the business.