Special Squads for attending summary assessments. - Income Tax - 1109/CBDT

INSTRUCTION NO. 1109/CBDT Dated : November 10, 1977 Special Squads have been formed for attending to summary assessments in some Commissioners charges. It is seen that these squads have succeeded in expediting the disposal of summary assessments. The Board have studied the working of these Squads and have prepared a model scheme which can be introduced in all the charges. 2. Structure of the Squad.- The Squad will be headed by the ITO having jurisdiction over the cases and will normally consist of an Inspector, one UDC and one LDC. Wherever the pendency of summary assessments is large, more than one Squad can be set up. The structure of the Squad may be suitably modified depending upon local conditions. 3. Preliminary Work - The success of the scheme will depend to a large extent on the completeness of the case records.. If, during the functioning of the Squad, time and effort have to be diverted to locate papers like Form No.6 and Form No.12, challans etc. the output of the Squad is bound to be poor. To avoid this it is necessary to do some preliminary work before the Squads start functioning. This preliminary work inter alia will consist of:- (i) Proper arrangement of assessment records, PAN-wise or alphabetically. (ii) Filing of applications in Form No.6 and Form No.12 in the respective case records; (iii) Linking of advance tax folders for the relevant year with the main file; (iv) Filing of all self-assessment tax challans in the respective folders; (v) Preparation of lists of the following types of cases; (a) Search and seizure cases. (b) Cases belonging to a group in which detailed investigation isconsidered necessary. (c) Cases in which tax evasion petitions containing specific allegations showing escapement of income of Rs.25,000 or more are pending for investigation. (d) Cases selected by the IAC for pre-assessment scrutiny in the manner provided in Board's Circular F.No.237/16/76-A PAC-II, dated 1stJuly, 1977. These lists must be drawn up by the ITO. The names must be in alphabetical order. One copy must be kept by the ITO and the other made available to the Inspector working on the Squad. If the Blue Book has been updated, instead of preparing lists, the cases to be left out of the Summary assessment scheme can be indicated in the Blue Book itself. (vi) Stocking of requisite forms, viz; Check-sheets, deficiency letters, assessment order forms, tax computation forms, demand notice forms, challans etc., so that disposal of a large number of assessments is not held up for want of these. 4. How the Squad should operate- On the morning of each working day the ITO or the Inspector will draw up in duplicate a list of 50 to 60 cases with returned income below Rs.75,000 in the case of registered firms and Rs.50,000 in other cases. The list will be prepared from the Blue Book if all the returns have already been entered in the Blue Book. If all the returns received have not been entered in the Blue Book, the squad will take charge of all current returns showing income below the limits mentioned above and draw up the list of cases from such returns, The number of cases can be varied depending upon actual experience. If permanent Account Numbers have been allotted and PANs are quoted in the Blue Books/returns, the list may contain only the PANs otherwise, names may have to be written. One copy will be sent to the Record Clerk and the other kept by the Inspector. (2) On receipt of the list, the Record Clerk will take out the case records, once again see that all relevant papers are filed therein and update the Blue Books on the basis of the returns in these cases and send them to the Inspector who will tick mark the case on his list in token of its receipt. The records should be sent to the Inspector on the very day the list is received. (If any file has not been sent by the Record Clerk until the file is received). (3) On receipt of the record, the I.T.I. will prepare the check-sheet attached to the Board's Circular dated 1.7.77. Column 1 of Part 1 and columns 1 and 2 part II will be filled with reference to the list prepared as indicted in para (1) above. In partial modification of the Board's Instruction dated 1.7.77, the check-sheet will be prepared by the Inspector. If the list includes a partner's case the Inspector will send for the files of the firm and other partners if the firm is assessed in the same ward and vice versa if the list includes a firm's case so that the assessment of partners's cases are completed alongwith firms' assessments. If it is found that a particular case is a "scrutiny case", it will be sent to the ITO for fixing the hearing. If it is found to be a summary assessment case, the case will be processed by the squad in the following manner:- (a) The I.T.I. will verify whether the return is complete. The defects which can be ignored and those which cannot be ignored are mentioned in Board's Instruction dated 1.7.77. Where there are defects which cannot be ignored are mentioned in Board's Instruction dated 1.7.77. Where there are defects which cannot be ignored, deficiency letters attached to the above circular should be prepared and sent to the assessee under the ITOs signature. Where the deficiency letter is sent, the letters 'DL' can be placed against the case in the list and when the deficiency is removed, the fact of removal of the deficiency can be indicated by the letter 'DR'. This will enable the inspector to take follow up action in those cases where the deficiency is not removed. (b) If the return is complete, the Inspector will compute the total income after making necessary adjustments as provided in Section 143(1)(b), and fill in the standardised assessment order. He will also indicate in the order, penalty proceedings, which are attracted and the sections under which interest is chargeable. (c) The file will next go to the UDC will calculate the tax, fill in ITNS 150 and get calculations checked by the Head Clerk if income exceeds Rs.20,000 or if the assessment results in refund exceeding Rs.100. After the calculation is checked he Clerk will fill in the tax computation part of the assessment order. He will then enter the name of the assessee in the demand and collection register. Wherever necessary, he will prepare penalty notices and make entries in the penalty register. If the assessment results in a demand or if adjustments under section 143(1)(b) are made, he will prepare demand notices and challans. Refund vochers also will be prepared by him. Thereafter the ceses will be put up to the ITO for signing the assessment order and entering the demand in the D C register. The ITO will do so after demand in the D C register. The ITO will do so after satisfying himself that the assessments are properly made. (d) After the receipt of the files from the ITO the LDC will prepare envelopes and acknowledgement slips enter the cases in the Notice Servers' Register and give these to the Notice Server after obtaining his signature. Where no demand notices are to be issued as provided in the Circular dated 1.7.77, the assessment order will be sent by ordinary post. Despatch of assessment order and refund orders must be strictly watched to eliminate delays or other complaints. (e) Thereafter, the case records will be sent to the Record Clerk for keeping them in the racks. 5. General- The members of the Squad must sit together in a group; the ITO may sit with the other members of the Squad or he may sit in his own room. Even if he prefers to sit in his own room he must visit the Squad frequently and sort out the problems that may arise. 6. Depending on the availability of space the Squad may be seated either in the record room or as close the record room as possible. 7. The availability of a ready reckoner with each squad must be ensured. Similarly, each squad must be provided with a cupboard so that forms, notices, case records etc. required by them can be kept therein. 8. In selecting cases for summary assessment the returns submitted earlier must be preferred to returns submitted later. 9. As pointed out in the Circular dated 1.7.77 assessments must be taken up strictly in the chronological order of assessment years. An assessment for a later year shall not be taken up unless the assessments for the earlier years have been completed. 10. The time that the ITO will save as a result of completing summary assessment in this manner must be utilised by him for making more scrutiny assessments and for ensuring that the assessment in the scrutiny cases are done properly. 11. This circular merely gives certain guidelines for the working of the squads. CsIT and IACs can make variations depending on local conditions having due regard to the legal provisions and the various instructions issued by the Board from time to time.