Impermissible avoidance agreement determination triggers directives to adjust taxable income and notification to the other party's authority.

A Commissioner issues a notice requiring the assessee to produce evidence; after hearing and considering particulars, the Commissioner may declare an arrangement an impermissible avoidance agreement. If so declared, the Commissioner must direct the Assessing Officer to adjust the assessee's total income or tax liability and forward the order to the assessee and to the jurisdictional Commissioner of the other party, who must then proceed similarly; the declaration is barred after twelve months from the end of the month in which the notice was issued.

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