Babasaheb Bhimrao Ambedkar

University, Lucknow

Table of Content

PROJECT REPORT ON
Powers and Functions of Income Tax
Authorities

SUBMITTED TO: Dr. Nitesh Kumar Chaturvedi

SUBMITTED BY:
Kumar Abhinav
ROLL NO: 206639
(BBA. LLB)
s

1. Introduction....................................................................................................................2

2. The Central Board of Direct Taxes (CBDT)..................................................................2

3. Jurisdiction of Income Tax Authorities..........................................................................3

4. Jurisdiction of Assessing Officer...................................................................................3

5. Powers of Income-tax Authorities Regarding Discovery, Production of Evidence.......4

6. Surajmull Nagarmull And Ors. vs The Commissioner Of Income Tax.........................4

7. V. A. Haseeb and Co. (Firm) v. CCIT...........................................................................5

8. Circumstances under which Power of Search and Seizure can be Exercised................6

9. Powers of the Authorized Officer..................................................................................6

10. Power of requisition books of account...........................................................................7

11. Power to call for Information.........................................................................................7

12. Power to Inspect Registers of Companies......................................................................8

13. Power to Make Enquiry.................................................................................................8

14. Conclusion......................................................................................................................9

15. Bibliography...................................................................................................................9

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Introduction

The Central Government may appoint such person as it thinks fit to be the income-tax

authorities in accordance with the rules framed in this connection. The central Government

may the board or Director General of Income-Tax or Chief Commissioner or Director or An

income tax authority authorized by the Board may also appoint such executive or ministerial

staff as may be necessary in the execution of its functions in accordance with the rules of the

Central Government.

The Central Board of Direct Taxes (CBDT)

The Central Board of Direct Taxes1 was constituted under the Central Board of Revenue Act,

1963. It works under the Ministry Finance. The Central board of Direct Taxes may, by

notification in the Official Gazette, direct that any income tax authority or authorities

specified in the notification shall be subordinate to such other income-tax authority or

authorities as may be specified in such notification.

1
www.india.gov.in/information-central-board-direct-taxes

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Jurisdiction of Income Tax Authorities

Income-tax authorities shall exercise all or any of the powers and person all or any of the

functions conferred on them in accordance with the directions issued by the Board or any

other income-tax authority.

Any such directions or orders may be issued having regard to the following criteria: -

(a). Territorial Area, e.g., Pin Code, Corporation division number.

(b). Persons or class of persons, e.g., Companies, Trusts.

(c). Income or class of income, e.g., salary income.

(d). Cases or class of cases, e.g., Professionals, contractors.

Jurisdiction of Assessing Officer

If an Assessing Officer2, by virtue of any direction or order issued under subsection (1) or

sub-section (2) of section 120, is vested with jurisdiction over any area, then he shall have

jurisdiction within the limit of such area in respect of any person.

(a). carrying on business or profession within that area or where the business or profession is

carried on by any person in more places than one, if the principal place of business or

profession is situated within that area.

(b). having place of residence within that area.

2
services.india.gov.in/service/detail/know-your-tax-jurisdictional-assessing-officer-1

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Powers of Income-tax Authorities Regarding Discovery,

Production of Evidence
The Assessing Officer, Deputy Commissioner (Appeal), Joint Commissioner, Commissioner

of (Appeals), Commissioner of Income-tax and Chief Commissioner shall have powers 3

vested in a court order under the Code of Civil Procedure while trying a suit in respect of the

following matters, viz.,

(a). Discovery and inspection.

(b). Enforcing the attendance of any person including any officer of banking company and

examining such person on oath.

(c). Compelling the production of books of accounts and other documents.

(d). Issuing commissions calling witnesses to appear, record statements, conduct enquiry, etc.

Surajmull Nagarmull And Ors. vs The Commissioner Of

Income Tax4

The Supreme Court held in that case that Section 5(1) of the Travancore Taxation on Income

(Investigation Commission) Act of 1124 had to be read in juxta-position with Section 47 of

the Travancore Income tax Act, 1121 and when so-read was not discriminatory and did not

violate-fundamental fight guarantee under Article 14> of the Constitution.

3
https://incometaxindia.gov.in/Acts/Income-tax%20Act,%201961/1997/102120000000014624.htm
4
AIR1961CAL578

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V. A. Haseeb and Co. (Firm) v. CCIT5

Chief Commissioner of Income tax TDS has rejected the petitioner’s application for

compounding the offence committed by the petitioner under section 276B read with section

278B of the Income-tax Act, on the ground that the assessee has been convicted by the

Criminal Court. Allowing the petition, the Court held that the assessee has been convicted of

an offense does not mean that the application for compounding of the offence is not

maintainable. Under the guidelines, the competent authority has to examine the merits of the

case and decide whether there is a case for compounding. There are no fetters on the powers

of the competent authority under the guidelines.

DECISION: Thus, this Court is of the view that the respondent can examine the matter

afresh without being, in any manner, influenced merely because of the conviction passed

against the petitioner by the Criminal Court.

Circumstances under which Power of Search and Seizure

can be Exercised

The powers of search and seizure under section 132 can exercised by Director or the Chief

Commissioner or any such Joint Director or Joint Commissioner as may be empowered in

this behalf by the Board in the following circumstances-

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(a). any person to whom summons under section 131(1) or a notice under section 142(1) has

been issued to produce or cause to be produced by any books of account, or other documents,

has omitted or failed to produce or cause to be produced, such books of accounts or other

documents.

(b). any person to whom summons or notice as aforesaid has been or might be issued, will not

produce or cause to be produced any books of account or other documents, which will be

useful for or relevant to any proceedings under the Act, or

(c). any person is in possession of any money, bullion, jewellery or other valuable thing and

such money, bullion, jewellery or other valuable thing represents either wholly or partly

income or property which has not been or would not be disclosed for the purpose of the Act.

Powers of the Authorized Officer

(a). Enter and search any building, place, vessel, vehicle or aircraft, where he has reason to

suspect that such books of account, document, money, bullion, jewellery or other valuable

articles or things are kept.

(b). Break open the lock of any door, box, locker safe, almirah, etc, where the keys are not

available.

(c). Search any person who has got out of or is about to get into or is in the building, place,

vessel, vehicle or aircraft which is being searched.

(d). Seize any such books of account, documents or assets found as a result of such search.

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(e). Place marks of identification of any books of accounts or other documents or take

extracts or copies there from.

(f). Make a note or an inventory of any such money, bullion, jewellery or other valuable

article or thing.

Power of requisition books of account

6
Where the Director General or Director or the Chief Commissioner or Commissioner, in

consequence of information in his possession, has reason to believe that any books of account

or other document will be useful for or relevant to any proceeding under the Act refer to the

requisitioning officer to deliver the books of accounts, other documents or assets.

Power to call for Information

Information can be gathered from a person who is considered to be useful for or to any

inquiry or in connection with any pending proceeding by the Assessing officer, the Deputy

Commissioner (appeals) the Joint Commissioner or the Commissioner (appeals).

Power to Inspect Registers of Companies.

6
https://incometaxindia.gov.in/Rules/Wealth-Tax%20Rules,%201957/2010/103120000000006938.htm

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The Assessing Officer, the Deputy Commissioner (appeals), the Joint Commissioner or the

Commissioner (appeals) or any person subordinate to him authorized in writing in this behalf

by the Assessing Officer, the Deputy Commissioner (appeals), the Joint Commissioner or the

Commissioner (appeals) may inspect and if necessary, take copies, or cause copies to be

taken of any register of the members, debenture holders or mortgagees of any company or of

any entry in such register.

Power to Make Enquiry

The Director-General or Director, the Chief Commissioner or Commissioner or

Commissioner and the Joint Commissioner shall be competent to make any enquiry under

this Act, and for this purpose shall have all the powers that an Assessing Officer has under

this Act in relation to the making of inquiries.

Conclusion

Under the Income-tax authority there are so many Officers appointed by the Government in

many designations and there is a hierarchy of the superiority of the officers according to the

rank of the officer from Director-General to Inspector, according to the designation the power

and function are divided as mentioned above.

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Bibliography

I have taken help from the following books and e-sources:

BOOKS

 Singhania, Student Guide to Income Tax, Taxmann (2016)

 Dinesh Ahuja and Ravi Gupta, Systematic Approach to Income Tax (2017)

E-SOURCES

 Central Board of Direct Taxes (CBDT) – https://incometaxindia.gov.in (last visited on

28 April, 2024)

 National Informatics Centre (NIC) - https://www.india.gov.in (last visited on 28th

April, 2024)

 ICA – https://itatonline.org (last visited on 28th April, 2024)

STATUTES

 The Income-tax Act, 1961 (Act 43 of 1961)

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