F.NO.225/95/2001-ITA-II
Government of India
Ministry of Finance
Department of Revenue
(Central Board of Direct Taxes)
New Delhi

To
        All CCsIT/DGsIT/CsIT

Sub:  Instructions regarding scrutiny of assessments

Sir,

In suppression of earlier instructions on the subject, I am directed to state that the procedure for selection of cases for scrutiny during  the current financial year 2001-2002 will be as under:-

1. All search cases will be centralised in the central circles and will be scrutinized.

2. Except for search cases, all the officers of a range including Addl. CIT/JCIT, DCIT, ACIT and ITO will have concurrent jurisdiction on all the cases failing in that range.  However, addl. CIT/JCIT will himself not make the assessment but will closely monitor and supervise the same.

3. The Addl. CIT/JCIT will allocate the files among Assessing Officers for processing under Section 143(1).

4. The Addl. CIT/JCIT, DCIT and ACIT will select cases for scrutiny having due regard to the information available with the department and scrutiny potential of the cases.  Facts of claiming heavy deductions under chapter VIA and heavy refunds will also be kept in mind.  The minutes will have drawn on the meeting held among them.

5. The proposal for selection along with minutes will be submitted to the Commissioners who will discuss it with the Addl. CIT/JCIT.

6. After a thorough discussion of these cases and also other cases in this connection, the Commissioners will approve the selection out of those cases for scrutiny.

7. The total number of cases selected for scrutiny in each range will be 30 in the ranges having only company cases and 40 in other ranges.  These cases will be in addition to actions arising on account of orders under section 263, 264, 148, appellate orders and directions of courts etc.

8. The cases will be assigned to DCIT/ACIT and ITO, by the Addl. CIT/JCIT for scrutiny, on the basis of comparative amount of returned income as well as the importance of the issues involved.

9. The first questionnaire will be issued only after the approval of the Addl. CIT/JCIT.

10. The Assessing Officers and the Addl. CIT/JCIT will discuss all the cases during the course of scrutiny from time to time.

11. The facts of the discussion of the cases with the Addl. CIT/JCIT will be recorded by the Assessing Officer in the office note, which will also be initialed by Addl. CIT/JCIT.

12. All the information available with the CIB and other outside agencies like Company Affairs, Directorate of Enforcement, CBI or any other agency of the Department or Government will be taken into account while completing the assessment.

2.               Officers will have full accountability with regard to selection of cases.
3.               All efforts will be made to have a thorough scrutiny and examination of the cases.

4.                Since the number of scrutiny assessment will be limited, the officers would be required to devote their extra time on the rest of  the work of the Department for completing the work other than scrutiny and  pay special attention to the collection work.
5.                A list is enclosed herewith giving a model of such activities.  But this list is only inclusive and does not include all other jobs which are supposed to be done by the officers during this period.  The Addl. CIT/JCIT will allocate the files of the range among different officers for completion of these jobs.
 

Yours faithfully,

Dr. Rajendra Kumar,
Under Secretary to Govt. of India