Selection of scrutiny cases. - Income Tax - Instruction No. 06/2002

INSTRUCTION NO. 6/2002 Dated: July 26, 2002 Subject: - Selection of cases for Scrutiny - procedure regarding. 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 2002-2003 will be as under: - (i) The following categories of cases shall be compulsorily scrutinised: - (a) All cases where survey action u/s 133A of the Income tax Act, 1961 has been undertaken and additional income has been detected, shall be assessed u/s 143(3)/144 of the Income Tax Act. (b) All cases where report of concealment of income is received from the Investigation Wing of the Department e.g. report on a Tax Evasion Petition, or from other enforcement agencies including CIB shall be taken up for scrutiny assessment. (c) Cases involving issues which have either been decided in favour of the Department or which are being agitated by the Department in appeals, where tax involved in the year under consideration is likely to exceed Rs. 50,000/- in the four metropolitan cities namely Delhi, Mumbai, Kolkata and Chennai and Rs. 20,000/- in other places shall be take up for Limited Scrutiny assessment u/s 143(3)(i) of the Income tax Act. (ii) The DCIT/ACIT and the ITOs will propose the lists of cases for scrutiny having regard to the information available with the Department and scrutiny potential of the cases, e.g. heavy deductions under Chapter VIA (Rs. 50 lakh and above in case of companies and Rs. 10 Lakh in case of non-companies), heavy refunds (Rs. 10 crore and above in case of metropolitan charges and Rs. 1 crore and above in case of other charges) and disproportionate income vis-a-vis turnover. The lists will be approved by CIT, after discussion with the JCIT/Addl. CIT in charge of the Range. (iii)The assessing officers will ensure that all the reasons are recorded before selecting any case of scrutiny and are properly investigated during the course of assessment under strict supervision of JCIT/Addl. CIT. (iv) Officers will have full accountability with regard to selection and satisfactory completion of cases. (v) The Addl. CIT/JCIT may assign cases selected for scrutiny assessment in even manner to the assessing officers having regard to their workload. F.NO. 225/46/2002/ITA-II (SANGEETA GUPTA) Director (ITA.II) Central Board of Direct Taxes