SHORT ANSWER:
The income tax department can freeze a bank account if there is a suspicion of tax evasion or non-payment of taxes.
DETAILS:
- The department can take this action under Section 281B of the Income Tax Act, 1961.
- It is done to protect the revenue and ensure that the taxpayer does not withdraw funds that may be required for tax dues.
PUNISHMENT / IMPLICATIONS (if applicable):
- The account can remain frozen until the tax liability is resolved or the order is revoked.
SOURCE:
- Income Tax Act, 1961
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