Failure to apply the higher rates of Income-tax and Wealth-tax leviable on HUFs. - Income Tax - 1118/CBDT

INSTRUCTION NO. 1118/CBDT Dated : November 16, 1977 It has come to the notice of the Board that there has been a large-scale failure on the part of the Departmental officials to apply the higher rates of Income-tax and Wealth-tax leviable on HUFs which have atleast one member having taxable income/wealth for the relevant assessment year, as the case may be. It is also noticed that such failure is fairly wide-spread not only in the assessment made for the assessment year 74-75 when the higher rates were prescribed for the first time, but in later years also. That such failure should happen in spite of instructions highlighting the changes in rates of tax made by the annual Finance Acts and specific columns provided in the return forms for this purpose, is a matter of great concern. 2. It has, therefore, been decided that the U.D.Cs/Supervisors/Headclerks should review the tax calculations for the assessment years 74-75 and onwards while checking tax calculations during the current year with a view to finding out mistakes in the application of rates of taxes in the case of such HUFs, in order to take remedial action before it gets barred by limitation. A foot-note should be recorded in the current ITNS 154/W.T. assessment form in the cases of such HUFs that the tax calculation for 74-75 assessment and onwards have been reviewed.