ITR
When an employee is summoned about the business
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Facts
A summons can be issued to any person with relevant knowledge, including an employee. The employee answers on oath about facts they know, and the business should support them with documents and authority.
Provisions and law
- Sec 131, Income-tax Act 1961 (now Sec 246, Income-tax Act 2025)Officers have civil court powers to summon, examine on oath and call for books and documents
- Sec 288, Income-tax Act 1961Who can appear as an authorised representative (2025 Act number to be confirmed)
Analysis
The employee should speak only about matters within their role and refer policy questions to the owner or directors. Example: the accountant is asked about cash payments of ₹3 lakh to a contractor; they can explain the entries and vouchers, but not why the owner chose cash. Brief the employee beforehand and send a CA along.
Conclusion
- Brief the employee on the scope of the summons
- Give an authority letter and the relevant records
- Send your CA with the employee
- Get a copy of the statement
- Review the statement with the owner afterwards
A Savvy can do this for you
Summons, Sec 131 (now 246)
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