INCOME TAXINCOME TAXAUTHORITIESAUTHORITIES

Income Tax DepartmentIncome Tax Department Their VisionTheir Vision

Their MissionTheir Mission

Their ValuesTheir Values

Who are income tax authorities? Who are income tax authorities? (Sec 116)(Sec 116)

(a) the Central Board of Direct Taxes.(a) the Central Board of Direct Taxes.

(b) Directors-General of Income-tax.(b) Directors-General of Income-tax.

(c)Directors of Income-tax or (c)Directors of Income-tax or Commissioners of Income-tax.Commissioners of Income-tax.

(d)Deputy Directors of Income-tax or (d)Deputy Directors of Income-tax or Deputy Commissioners of Income-tax.Deputy Commissioners of Income-tax.

(e)Assistant Directors of Income-tax or (e)Assistant Directors of Income-tax or Assistant Commissioners of Income-tax.Assistant Commissioners of Income-tax.

(f)Income-tax Officers.(f)Income-tax Officers.

(g)Tax Recovery Officers.(g)Tax Recovery Officers.

(h) Inspectors of Income-tax. (h) Inspectors of Income-tax.

(i) Additional Directors of Income (i) Additional Directors of Income tax.tax.

(j) Joint Directors of Income tax (j) Joint Directors of Income tax and Joint Commissioners.and Joint Commissioners.

Importance of the Assessing OfficerImportance of the Assessing Officer

Plays a vital role in the organizational setup.Plays a vital role in the organizational setup.

Primary authority who initiates proceedings Primary authority who initiates proceedings and directly connected with public.and directly connected with public.

Orders passed by him can be challenged only Orders passed by him can be challenged only on appeal.on appeal.

Appointment of Income Tax Appointment of Income Tax AuthoritiesAuthorities

Power of Central Government.Power of Central Government.

Powers of the Board and other High Powers of the Board and other High Authorities.Authorities.

Powers to appoint executive and ministerial Powers to appoint executive and ministerial staff.staff.

CENTRAL BOARD OF DIRECT CENTRAL BOARD OF DIRECT TAXES (CBDT)TAXES (CBDT)

Since 1 January 1964 the Central Board of Since 1 January 1964 the Central Board of Direct Taxes (CBDT) has been charged with Direct Taxes (CBDT) has been charged with all matters relating to various direct taxes all matters relating to various direct taxes in India and it derives its authority from in India and it derives its authority from Central Board of Revenue Act 1963.Central Board of Revenue Act 1963.

Powers of CBDTPowers of CBDT>> Instructions to subordinate authorities>> Instructions to subordinate authorities

>> Orders issued by way of relaxation of certain >> Orders issued by way of relaxation of certain provisions under section 119(2)(a)provisions under section 119(2)(a)

>> Orders giving extension of time limit [Sec. 119(2)>> Orders giving extension of time limit [Sec. 119(2)(b)](b)]

>> Orders giving relaxation for claiming deduction >> Orders giving relaxation for claiming deduction [119(2)(c)][119(2)(c)]

Director General/Chief Director General/Chief Commissioner of Income taxCommissioner of Income tax

Appointment:Appointment:By the central Govt. By the central Govt.

Jurisdiction:Jurisdiction:Determined by CBDT.Determined by CBDT.

Functions:Functions:CBDT assigns functions by general or special order.CBDT assigns functions by general or special order.

Powers:Powers: Exercise powers of an assessing officer.Exercise powers of an assessing officer. Appoint income tax authorites below the rank Appoint income tax authorites below the rank

of assisstant commissioner.of assisstant commissioner. Make enquiries on investigations into Make enquiries on investigations into

concealment – Section 131 (1A)concealment – Section 131 (1A) Giving instructions to income tax officers Giving instructions to income tax officers

Section 119 (2)Section 119 (2) Power of Survey- Section 133APower of Survey- Section 133A Power to make enquiry – Section 135Power to make enquiry – Section 135

Commissioners/Directors of Income Commissioners/Directors of Income TaxTax

Appointment:Appointment: By central govt.By central govt.

Jurisdiction:Jurisdiction: Determined by central boardDetermined by central board of direct taxes.of direct taxes. Functions :Functions : The Board assigns functionsThe Board assigns functions by general or special order.by general or special order.

Powers:Powers:

Commissioner may exercise powers of an assessing Commissioner may exercise powers of an assessing officer.officer.

Power to transfer any case from one or more Power to transfer any case from one or more assessing officers to any other assessing officer.assessing officers to any other assessing officer.

Grant approval for an order issued by the assessing Grant approval for an order issued by the assessing officer.officer.

Prior approval is required for reopening of an Prior approval is required for reopening of an assessment. assessment.

Power to revise an order passed by an assessing Power to revise an order passed by an assessing officer.officer.

Deputy Commissioner/Assistant Deputy Commissioner/Assistant commissioners of income tax.commissioners of income tax.

Appointment:Appointment: By central govt.By central govt.

Jurisdiction:Jurisdiction: Determined by central Determined by central board of direct taxes.board of direct taxes. Functions :Functions : The Board assigns functions by general or special The Board assigns functions by general or special

order.order.

Powers:Powers:

Empowered to accord to sanction to levy Empowered to accord to sanction to levy

additional income tax. additional income tax. Power to exercise powers of an assessing Power to exercise powers of an assessing

officer.officer. Cancel registration of a firm.Cancel registration of a firm. Power to issue instructions to assessing Power to issue instructions to assessing

officer.officer.

Joint commissionerJoint commissioner

Functions:Functions: Detect tax evasions and supervise Detect tax evasions and supervise

subordinate officers.subordinate officers.

Powers:Powers: Accord approval to adopt fair market value as full Accord approval to adopt fair market value as full

consideration – section 52.consideration – section 52. Instructions to income tax officers – section 119 (3).Instructions to income tax officers – section 119 (3).

- Exercise powers of income tax officers - Exercise powers of income tax officers section 125 a.section 125 a.

- Power to call information section 133.- Power to call information section 133.

- Power to inspect registers of companies - Power to inspect registers of companies section 134.section 134.

- Power to make any enquiry section 135.- Power to make any enquiry section 135.

Assisstant Commissioner/ Income Assisstant Commissioner/ Income tax officertax officer

Jurisdiction:Jurisdiction: Determination of CBDT.Determination of CBDT. Instructions by Director General.Instructions by Director General. Concurrent jurisdiction .Concurrent jurisdiction . Disputes regarding jurisdiction.Disputes regarding jurisdiction. Jurisdiction not to be disputed.Jurisdiction not to be disputed.

Powers:Powers:

Power of civil court.Power of civil court. Powers of search and Powers of search and seizureseizure Power of assessment.Power of assessment. Power to call Power to call information.information. Power of survey.Power of survey. Power to inspect registers of companies.Power to inspect registers of companies.

Income tax officersIncome tax officers

Class I service - appointed by central govt.Class I service - appointed by central govt. Class II service - appointed by commissioner Class II service - appointed by commissioner

of income tax.of income tax. Powers, functions andPowers, functions and

duties of the income duties of the income

tax officer.tax officer.

Search and seizure and Income Search and seizure and Income Tax RaidTax Raid

Under the Income Tax Act, the Search and Under the Income Tax Act, the Search and Seizure operations are a carefully and secretly Seizure operations are a carefully and secretly devised plan of action on the basis of authentic devised plan of action on the basis of authentic and bonafide information and material and bonafide information and material (something more than a rumor and gossip), (something more than a rumor and gossip), which may be gathered on its own or given by which may be gathered on its own or given by some informer.some informer.

The authorities can exercise these powers when due The authorities can exercise these powers when due to the information in their possession; they have firm to the information in their possession; they have firm reason to believereason to believe : :

Any person to whom a summon or notice has been or might Any person to whom a summon or notice has been or might be served, has failed or would not produce the books of be served, has failed or would not produce the books of accounts or other documents as called for.accounts or other documents as called for.

Any person is in possession of money, bullion, jewellery or Any person is in possession of money, bullion, jewellery or such property which has not been disclosed.such property which has not been disclosed.

The tax payer has the following rights in case of search-The tax payer has the following rights in case of search-

Examining the search warrant which must clearly specify the name of the Examining the search warrant which must clearly specify the name of the party to be searched and be duly signed by the officer. The search warrant party to be searched and be duly signed by the officer. The search warrant issued in the name of the firm cannot be used to seize assets of individual issued in the name of the firm cannot be used to seize assets of individual partners.partners.

Calling two or more respectable inhabitants of the locality to act as Calling two or more respectable inhabitants of the locality to act as witnesses.witnesses.

Verifying the identity and make personal search of each member of the Verifying the identity and make personal search of each member of the search party.search party.

Calling a doctor in case of emergency.Calling a doctor in case of emergency. Inspect seals placed on various objectsInspect seals placed on various objects Inspect and take photocopies of the seized books of account and Inspect and take photocopies of the seized books of account and

documents.documents.

Income tax raidIncome tax raid

What leads to income tax raids, searches and seizures?What leads to income tax raids, searches and seizures?

The main reasons are non-compliance with summons under The main reasons are non-compliance with summons under Section 131(1) of the Income Tax Act, 1961, or the possession Section 131(1) of the Income Tax Act, 1961, or the possession of undisclosed property or income. It is therefore absolutely of undisclosed property or income. It is therefore absolutely necessary for a current income tax assessee or a likely income necessary for a current income tax assessee or a likely income tax assessee to comply with the summons or notice issued by tax assessee to comply with the summons or notice issued by the Assessing Officer, or any other such authorised person.the Assessing Officer, or any other such authorised person.

A tax raid may also be conducted against a person in A tax raid may also be conducted against a person in possession of undisclosed income or property not belonging to possession of undisclosed income or property not belonging to him but to someone else.him but to someone else.

5 steps to prevent an Income tax 5 steps to prevent an Income tax raidraid

1. Make correct disclosure of income and wealth in 1. Make correct disclosure of income and wealth in returns.returns.

2. Comply with summons or notices to prevent a tax 2. Comply with summons or notices to prevent a tax raid.raid.

3. How to declare exempted or non-taxable income 3. How to declare exempted or non-taxable income and wealth.and wealth.

4. Preserve important vouchers and other 4. Preserve important vouchers and other documentary evidence for the acquisition of assets.documentary evidence for the acquisition of assets.

5. How to prevent an income tax raid on lockers, and 5. How to prevent an income tax raid on lockers, and safe deposit vaults.safe deposit vaults.

Income Tax raid in Himesh Reshamiya’s Income Tax raid in Himesh Reshamiya’s househouse

- Taxman came visiting his house in - Taxman came visiting his house in

Mumbai.Mumbai.

- Come under the scrutiny of the Income Tax Come under the scrutiny of the Income Tax Department for allegedly paying less service tax. Department for allegedly paying less service tax.

- The intensive survey of his residence is part of the - The intensive survey of his residence is part of the verification process. verification process.

Disclosure of information regarding Disclosure of information regarding assesses to certain authoritiesassesses to certain authorities

(Section 138)(Section 138) The Board or any other authority so authorised by The Board or any other authority so authorised by

Board, may furnish or cause to be furnished any Board, may furnish or cause to be furnished any information which the income tax authorities have information which the income tax authorities have obtained while performing their duties to any officer, obtained while performing their duties to any officer, authority or body performing any function under any authority or body performing any function under any law relating to imposition of tax, law relating to imposition of tax,

duty or cess or in foreign exchangeduty or cess or in foreign exchange dealings or any other authority sodealings or any other authority so notified.notified.

Quick facts..Quick facts..

The Karnataka & Goa Region is within the The Karnataka & Goa Region is within the administrative and cadre control of the Chief administrative and cadre control of the Chief Commissioner of Income-tax, Bangalore.Commissioner of Income-tax, Bangalore.

The Region of Karnataka and Goa has at its apex five The Region of Karnataka and Goa has at its apex five Chief Commissioners of Income-tax and Director Chief Commissioners of Income-tax and Director General of Income-tax .General of Income-tax .

The Chief Commissioners of Income Tax are The Chief Commissioners of Income Tax are stationed at Bangalore, Hubli & Panaji, while the stationed at Bangalore, Hubli & Panaji, while the Director General of Income Tax is stationed at Director General of Income Tax is stationed at Bangalore. Besides, the Region has 24 Administrative Bangalore. Besides, the Region has 24 Administrative & 13 Appellate Commissioners of Income Tax.& 13 Appellate Commissioners of Income Tax.

QUIZ TIME!QUIZ TIME!

Income tax quizIncome tax quiz

When was Income-Tax introduced?When was Income-Tax introduced?

a) 1404a) 1404

b) 1604b) 1604

c) 1504 c) 1504

2. What, in India, is regarded as the first 2. What, in India, is regarded as the first authoritative text on public finances? authoritative text on public finances?

a) Manu Smritia) Manu Smriti

b) Raghuvanshb) Raghuvansh

c) Arthasastrac) Arthasastra

3. India's first I-T Act came into being in..?3. India's first I-T Act came into being in..?

a) 1860a) 1860

b) 1910b) 1910

c) 1922c) 1922

4. Italian dictator Benitto Mussolini introduced a 4. Italian dictator Benitto Mussolini introduced a novel tax. Name it.novel tax. Name it.

a) Soul taxa) Soul tax

b) Salt Tax b) Salt Tax

c) Bachelor Tax c) Bachelor Tax

5. What is the full form of CBDT? 5. What is the full form of CBDT?

a) Cash Before Delivery and Taxation a) Cash Before Delivery and Taxation

b) Central Board of Direct Taxes b) Central Board of Direct Taxes

c) Chennai Board of Direct Taxesc) Chennai Board of Direct Taxes

THE ENDTHE END