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CMA Final · Direct Tax Laws and International Taxation · CBDT and Other Authorities

The Board issues an order under section 241 requiring an Assessing Officer and a Joint Commissioner to exercise powers concurrently over a class of cases. Which statement follows from section 241(7)?

The lower-ranking authority must exercise the powers as the higher authority directs, and references to the Assessing Officer are treated as references to that higher authority. Approval requirements of such authority then do not apply. The arrangement is valid even when the officers are of different classes.

  1. AThe lower-ranking authority acts as the higher authority directs, and references to the Assessing Officer are read as references to the higher authorityCorrect
  2. BBoth authorities act independently, and the assessee chooses whose orders to follow
  3. CThe higher authority is barred from directing the lower one, and each retains separate approval requirements
  4. DThe concurrent arrangement is invalid unless both authorities are of the same class

Explanation

Under section 241(7), where authorities of different classes act concurrently, the lower in rank exercises powers as the higher directs. References to the Assessing Officer are deemed to be references to the higher authority, and any provision requiring approval of that authority does not apply. The option requiring the same class is wrong because the provision covers whether or not they are of the same class.

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