CBDT and Other Authorities: formula sheet

Key formulas

Classes of authorities (section 236)

12 classes: Board → Pr. DG/Pr. CCIT → DG/CCIT → Pr. DIT/Pr. CIT → DIT/CIT/CIT(A) → Addl. → Joint → Deputy → Assistant → ITO → TRO → Inspector

The Board is class (a). Tax Recovery Officers are class (k) and Inspectors are class (l).

General appointment power (section 237(1))

Central Government appoints such persons as it thinks fit

This is the source power. Delegation under (2) is an exception.

Delegated appointment (section 237(2))

Authorised officer or Board may appoint authorities below the rank of Deputy/Assistant Commissioner

Needs authorisation by the Central Government and is subject to service rules and orders.

Staff appointment (section 237(3))

Authority authorised by the Board appoints executive or ministerial staff

Staff appointment is for assisting the authority in its functions.

General power to issue directions

Section 239(1): orders, instructions, directions to income-tax authorities for proper administration

Binding on income-tax authorities and all persons employed in executing the Act.

Limits on the power

Section 239(2): no direction to (a) make a particular assessment or dispose of a case in a particular manner; (b) interfere with discretion of JCIT(A)/CIT(A) in appellate functions

A direction that does either is outside the Board's power.

Guidelines for revenue work

Section 239(3)(a): general or special orders, not prejudicial to assessees

Can relax listed provisions for a class of incomes or cases. May be published in the public interest.

Late claims, genuine hardship

Section 239(3)(b): authorise an authority (not JCIT(A)/CIT(A)) to admit a late application or claim and deal with it on merits

Covers exemption, deduction, refund or other relief claimed after the time limit.

Relaxation for deduction conditions

Section 239(3)(c): relax a requirement of Chapter IV or VIII if (i) default was beyond assessee's control and (ii) complied before completion of assessment for that tax year

Needs a general or special order with reasons. Under 239(4), every such order is laid before each House of Parliament.

Jurisdiction

Section 241(1)-(4): authorities act per Board directions; criteria: territorial area, persons, incomes, cases

Section 241(8): Board may by notification direct return filing or other acts by a person or class.

Appeal monetary limits

Section 373(1): Board fixes monetary limits for appeals by income-tax authorities

Not filing an appeal does not bar appeal on the same issue for another year or another assessee (373(2)); assessee cannot claim acquiescence (373(3)).

Control of authorities

Section 238: Board notification → authority A is subordinate to authority B

Subordination is set by notification of the Board.

Jurisdiction over a business or profession

Section 242(1)(a): place of business in the area; if more than one place, principal place in the area

Applies to a person carrying on business or profession.

Jurisdiction over any other person

Section 242(1)(b): person residing within the area

Residence in the area decides the Assessing Officer.

Who decides a jurisdiction dispute

Section 242(2) and (3): specified income-tax authority; if different authorities disagree, the Board or its notified authority

The Assessing Officer refers the matter before the assessment if not satisfied with the assessee's claim.

Time limit to challenge jurisdiction

Section 242(4): return filed → within one month of notice under section 268(1) or 270(8), or before assessment completes, whichever is earlier

If no return is filed, the time allowed by the notice for the return or the show-cause notice, whichever is earlier.

Specified income-tax authority

Section 243(7): Principal DG, DG, Principal Chief Commissioner, Chief Commissioner, Principal Commissioner or Commissioner

Used in sections 241, 242 and 243.

Enabling power

Section 245(1): Central Government, by notification, may make a scheme for faceless jurisdiction

The scheme covers powers under section 241, jurisdiction of AO under section 242, transfer of cases under section 243 and change of incumbency under section 244.

Three aims of the scheme

Section 245(2): (a) eliminate interface; (b) resource optimisation; (c) team-based work with dynamic jurisdiction

Purpose is greater efficiency, transparency and accountability. Interface is removed only to the extent technologically feasible.

Power to modify the Act

Section 245(3): notification may direct provisions do not apply or apply with exceptions, modifications and adaptations

Only for giving effect to the scheme made under section 245(1).

Parliamentary oversight

Section 245(4): notifications under sub-sections (1) and (3) to be laid before each House of Parliament

Laid as soon as may be after issue.

Faceless assessment machinery

Section 273: National Faceless Assessment Centre + assessment, verification, technical and review units

Communications go through the Centre by electronic mode. Board may set up the units and specify functions.

Quick revision

• Under section 238, the Board may notify that one income-tax authority is subordinate to another.
• Under section 241, authorities act as per Board directions.
• A higher-ranking authority may exercise the powers of a lower one if the Board so directs.
• Board directions may use four criteria: territorial area, persons or classes of persons, incomes or classes of income, cases or classes of cases.
• Section 241(5)(b) lets specified authorities direct that Assessing Officer powers be exercised by an Additional or Joint Commissioner or Director.
• Two or more Assessing Officers may exercise powers concurrently; the lower-ranking one follows directions of the higher.
• Section 245 lets the Central Government make a faceless jurisdiction scheme by notification.
• The scheme aims at efficiency, transparency and accountability by eliminating interface to the extent technologically feasible.
• Section 245 notifications must be laid before each House of Parliament.
• Section 273 requires faceless assessment for the cases the Board specifies.
• The National Faceless Assessment Centre routes communications, and these are exchanged exclusively by electronic mode.
• Faceless assessment units are assessment, verification, technical and review units.

Common mistakes

• Saying the Board always appoints every authority. Fix: The general power is with the Central Government. The Board appoints only if the Central Government authorises it under section 237(2).
• Stating the delegation limit as 'below Commissioner'. Fix: Remember the wording: below the rank of Deputy Commissioner or Assistant Commissioner.
• Saying the Board can direct an Assessing Officer to assess a particular case in a particular way. Fix: Remember section 239(2)(a). The Board can give general guidance, not decide an individual case.
• Thinking the Board can direct the Commissioner (Appeals) on how to decide appeals. Fix: Section 239(2)(b) protects appellate discretion. Directions cannot interfere with it.
• Using residence to decide jurisdiction over a businessman Fix: For business or profession, use the place of business, or the principal place if there are several. Residence applies to any other person.
• Saying the Act itself fixes who is subordinate to whom Fix: Section 238 works through a Board notification specifying the subordination.
• Saying the Board makes the section 245 scheme Fix: Section 245(1) says the Central Government makes the scheme by notification. The Board appears in section 241 directions and section 273.
• Writing that interface is eliminated completely Fix: The Act says eliminating interface 'to the extent technologically feasible'. Quote this qualifier.

Exam tips

• Learn section 236 as an ordered list; MCQs often ask which class comes after or before another.
• Remember the three layers of section 237: Central Government, delegated authorities, and staff.
• In case-based questions, check rank first, then whether an authorisation exists.
• Use Income-tax Act, 2025 section numbers (236, 237) and not the 1961 Act's.
• Learn section 239(2) word for word in substance. It is the favourite point for validity questions.
• In case scenarios, separate general instructions (valid) from case-specific outcome directions (invalid).
• Quote the Income-tax Act, 2025 section numbers: 239, 240, 241, 373 and 491.
• Remember the two protections for assessees: orders under 239(3)(a) must not be prejudicial, and hardship relaxations need the stated conditions.