After the Tamil Nadu State Assembly Election Model Code of Conduct was in force, the Tamil Nadu State Survelliance Team intercepted two persons R. Unnikrishnan  a bank manager, and M.  Swaminathan, who were found carrying  in cash in a vehicle, and seized the cash. The statement of  R. Unnikrishnan    was recorded under section 131(1A) of the Income-tax Act, 1961. A statement was also obtained from the assessee’s chairman who stated that a consolidated cheque  was drawn for being disbursed towards the salary of 25 different staff members and collected, 25 self-cheques were drawn and the amount withdrawn was to be handed at his house as he was unable to go to the bank himself. After the orders rejecting the applications filed under rule 112F of the Income-tax Rules, 1962 were rejected and an assessment order was passed, R. Unnikrishnan   retracted his earlier statement. On writ petitions contending that the exception provided in the provisions of rule 112F were attracted and therefore invocation of the provisions of sections 153A and 153C was without jurisdiction, that the Assessing Officer should not have made assessment section 143(3) read with 153(1)(b). On writ dismissing the petitions, that merely because the search was conducted or requisition was made when the Tamil Nadu State Assembly Model Code of Conduct from the State Assembly election in Tamil Nadu was in force that could not mean that the issuance of notice under section 153A or section 153C would be automatically excluded and the exception under rule 112F(ii) applied. The seizure of cash from the possession of R. Unnikrishnan   the bank manager and S, merely coincided with the implementation of the Tamil Nadu State Assembly Model Code of Conduct. The exception under rule 112F(ii) of the Income-tax Rules, 1962 would apply only where the assets seized or requisitioned were in any manner connected with the ongoing election in an assembly or Parliamentary constituency. On the facts this exception was not applicable to the assessee since the statements of R. Unnikrishnan  and M. Swaminathan  made it clear that it was the practice of the assessee as the president of the trust to credit the salary of the employees into their personal savings account and thereafter withdraw it by collecting self-drawn cheques duly signed by them. The statement that was given by the assessee was retracted only at a later point of time. Unless, the cash seized was in connection with the assembly election, the question of excluding the assessee and its president from the purview of proceedings under sections 147, 153A or 153C could not be countenanced. (AY.2021-22)