Guidelines for decentralization of cases from Central Charges - Income Tax - F.No.286/68 /2005-IT(Inv.-II)

F.No.286/68 /2005-IT(Inv.-II) Ministry of Finance Department of Revenue Central Board of Direct Taxes Date of Issue : 13.06.2005 To, AlI Chief Commissioners of Income Tax(CCA) and All Director Generals of Income Tax(Inv.)/Chief Commissioners of Income Tax (Central) Subject: Guidelines for decentralization of cases from Central Charges Sir/Madam, I am directed to refer to Board s letter F.No.414/46/99-IT(Inv.-I) dated 27.07.1999 and to convey the following guidelines regarding decentralization of cases from Central Charge: (i) The case may be decentralized after the decision of the first appeal. (ii) In case where the Department or the assessee have filed a second appeal before the ITAT, then a paper book dealing with all issues which are matter of contention before the ITAT by the Department/ Assessee must be prepared by Assessing Officer of the Central Charge and handed over to the succeeding Assessing Officer. (iii)The A.O. in the Central Circle before transferring the case should ascertain following seized documents/seized material. (a) The documents and material referred to in the Assessment Order; (b) The documents and other material referred by the assessee with reference to his defence before the AO; (c)The documents and material referred by the asseessee before CIT(Appeal) in his order; (d) The documents referred by the assessee before CIT(Appeal), the list of which is available with the Assessing Officer with reference to the submissions made by the assessee before CIT(Appeal). The A.O. should segregate the above 4 materials in addition to the copies of Panchnama, statements recorded in the course of search and retain these referred documents/materials as a part of search material and hand it over to the succeeding A.O. (iv) Documents other than the retained referred documents should be returned to the assessee and an undertaking be obtained that these released documents would be produced in subsequent proceedings as and when needed. Only after completing this work, the A.O. should propose the case for transfer. (v) The seized material having bearing on prosecution proceedings should not be released till the completion of such prosecution proceedings and the same should be handed over by the A.O. of the Central Charge to the succeeding A.O, Such seized material must be kept in the personal custody of the A.O. (vi) In case where the prosecution has been launched, the A.O. of the Central Charge shall hand also over the following information/ documents: (a) the name and present whereabouts of the A.O. who filed the complaint must be kept in dossier; (b) the reasons for launching prosecution, the corroborative evidence and the names and addresses of the witnesses mentioned in the prosecution complaint should be communicated to the succeeding A.O. The above method shall also be followed where prosecution is contemplated. (vii) If, no appeal is pending /likely to be filed, entire documents are to be released. (vii) The penalty proceedings u/s 271(1)(C) should be concluded before decentralization. (ix) Where an application has been filed before the Settlement Commission u/s 245D(1) of the Income Tax Act, the case shall not be decentralized before receiving order of the Settlement Commission u/s 245D(4) and giving effect to the same. In case a writ petition before the High Court or an SLP before the Supreme Court, has been filed or is contemplated to be filed against this order of the Settlement Commission, the cases should not be decentralized. (x) The DGIT(lnv.)/CClT(Central) are the sole authority to decide whether or not a case should be decentralized. In case of any serious difference of opinion between the DGIT (lnv.)/ CCIT(Central) and the territorial CCIT, regarding correct-jurisdiction, the matter may be referred to the Board for its decision U/S 127(2)(b). (xi)In cases where proceedings U/S 147 or U/S 263 have been initiated, the case should be decentralized on completion of such proceedings. (xii) In the event of death of the assessee or succession by different assessee (by way of amalgamation of the Company or a discontiuation of the business) the case will not be decentralized. (xiii) All the cases in Central Circle should be scrutinized as expeditious decentralization process is envisaged in the present case. This is particularly so as the CIT(Appeal) is disposing all the files expeditiously at an early date. (xiv) The files may be decentralized in time by passing the orders of decentralization. However, decentralization should be effective only from the second week of April of the next financial year, if the order is passed after 31st May (except in the current financial year 2005-06 when the cases may be decentralized upto 31st July, 2005). (xv) While deciding the budget target, the collection made with reference to the files, which are transferred out of the Central Circles, should be taken into consideration for adjustments of the Budget. Yours faithfully, Sd/ (P.K. MISHRA) Director (Inv. II III)