Reason to believe: reopening assessments require concrete prima facie material before issuing notices, not mere suspicion.
Reopening assessments requires an honest and reasonablereason to believe that income has escaped assessment supported by material or prima facie facts; ITOs must state the factual basis in reports and Commissioners must independently satisfy themselves of prima facie grounds rather than mechanically granting sanction, since notices issued on mere suspicion or vague beliefs have been held invalid.

Tax Deduction at Source compliance review ordered to assess and rectify non deduction and delayed remittance of interest TDS.
The Board directed an immediate, charge wise review to ascertain the extent of non-deduction, short deduction and delayed remittance of tax at source on interest; the review must assess monitoring and enforcement arrangements, identify omissions and remedial actions taken, propose improvements to ensure proper TDS implementation, and report results to the Board by the prescribed deadline.

No-objection certificate for non-resident dividend and royalty remittances may be issued by assessing tax officers or the Board.
No-objection certificates required by the Reserve Bank for remittance of dividends or royalties to non-residents may be obtained from the assessing Income-tax officer of the recipient; if jurisdiction over the recipient is not determined, the certificate may be obtained from the Income-tax officer assessing the payer or from the Board. Refusal by an Income-tax Officer to issue such certificates as lacking statutory provision is incorrect, and officers must be instructed to process requests expeditiously.

Summary assessment procedures require issuing assessment order copies and computations with demand notices and prompt delivery.
Summary assessments must include a copy of the assessment computation or a standard assessment order when delivered with demand notices, challans or refund vouchers. Where returns are modified the prescribed proforma showing additions, deletions or exempt treatment must be used; where returns are accepted a stamp indicating assessment under the summary procedure may be affixed. These assessment documents should be sent with payment/refund documents and delivered to the assessee within a short prescribed period after completion.

Inclusion of lineal descendants' shares: conflicting constitutional views prompt departmental instructions to rely on the validating precedent and pursue appeals.
Inclusion of lineal descendants' shares in calculating the estate duty rate under section 34(1)(c) is disputed on equal protection grounds, with conflicting high court decisions. The revenue board instructs officers to notify the decision upholding inclusion, to rely on that decision in appeals where the contrary view is invoked, to note that tax authorities cannot pronounce on constitutional validity, and to pursue appeals or references against appellate decisions following the opposing judgment.

Withholding of refund: ordinarily issue refunds per appellate order before forwarding cases for departmental appeal.
The Board directs that refunds under section 241 ordinarily should not be withheld merely because case records are forwarded for departmental appeal; effect should be given to an appellate order and the refund issued before sending the case up for departmental appeal, withholding only when strictly necessary.

TDS compliance requires filing the prescribed statement reporting dividend tax deductions within the statutory filing period.
Persons deducting tax at source from dividends under Section 194 must send a prescribed statement (Form No.26) to the Income-tax Officer assessing the company. That statement must be furnished within fourteen days of the date of deduction, and authorities have directed strict enforcement of this timing requirement.

Search warrant copy: ordinarily the warrant is produced at search, not supplied; certified copy obtainable and court directions prevail.
The warrant issued by a Magistrate is a public document and a certified copy may be obtained from the custodian on payment of legal fees; the Criminal Procedure Code requires production of the warrant to the person concerned in specified cases but does not mandate supplying a copy in every instance, so ordinarily the warrant is produced during the search and a copy need not be furnished, although any High Court direction to supply a copy must be complied with.

Tax exemption threshold for foreign remuneration reduces the salary amount on which income tax is computed.
Computation under section 10(6)(viia)(A) treats remuneration as including salary, allowances and perquisites provided by the employer outside India; the exempt initial slice of remuneration is not includible in total income and must be deducted from total remuneration to determine the amount chargeable under the head "Salaries."

Normal depreciation and extra shift allowance clarified under income tax rules; instructions supersede prior guidance and require officer briefings.
Allowance of normal depreciation and extra shift allowance is restated by a Board circular that supersedes prior instructions; Inspecting Assistant Commissioners are directed to convene meetings of Income-tax officers (or the senior-most Income-tax Officer where no inspecting officer exists) to explain and discuss the circular and ensure uniform administrative application of its provisions.

Extra shift depreciation allowance defines eligibility, exclusions, and calculation method for double and triple shift operations.
Normal depreciation rules changed from 1970-71: before 1970 non-seasonal factories' depreciation depended on days worked and seasonal factories required working all seasons for full allowance; from 1970-71 normal depreciation is fully admissible if a factory worked at any time in the previous year. Extra shift depreciation is additional to normal depreciation, claimable only on proof of actual double or triple shift working, excludes plant marked "NESA" and certain categories, uses a 180-day (seasonal) or 240-day (non-seasonal) norm (or actual days if greater), and is calculated by specified formulae for double (half normal depreciation proportionate to double-shift days) and triple shifts (full normal depreciation proportionate to triple-shift days).

Taxation of casual winnings reclassified as taxable income, with new withholding and tightened exemptions affecting trusts and contractors.
The Finance Act, 1972 updates tax rates and withholding regimes, treating winnings from lotteries and similar prizes as taxable income with source deduction under a new provision and imposing withholding on payments to contractors and sub contractors. It withdraws certain industry and cooperative dividend concessions, narrows exemptions for casual receipts, and prescribes conditions for charitable trusts to retain tax exemptions including registration and audit requirements. Wealth tax and gift tax provisions are amended to clarify exemptions, add asset categories, allow holding period concessions on converted exempt assets, increase interest on arrears and refunds, expand treaty powers for information exchange and recovery, and empower rules regulating admission of additional appellate evidence.

Implementation of revised procedures: commissioners must hold meetings and ensure regular reviews to secure compliance.
Each Commissioner of Income-tax must meet with Inspecting Assistant Commissioners to plan implementation of new or revised circulars; Inspecting Assistant Commissioners must hold meetings with I.T. Officers and staff, give instructions for proper implementation, and undertake monthly or quarterly reviews (as decided by the Commissioner) to ensure procedures are followed and implementation difficulties are identified and resolved. Circulars will be marked with triple asterisks for identification.

Probation of Offenders Act should not be lightly applied where statute prescribes minimum imprisonment; prosecutors urged to rely on principle.
The Board directs prosecution counsels handling cases under Sections 277 and 278 of the Income Tax Act to rely on the Supreme Court's ruling that, while the Probation of Offenders Act applies despite statutory minimum sentences, courts should not lightly grant probation where the statute prescribes a minimum sentence intended to protect the public; prosecution counsel should invoke that guidance and may pursue selective test cases based on enactment-date arguments.

Section 80E deduction: refund of annuity deposit not income from personal exertion, affecting deduction eligibility.
Deduction under Section 80E(6)(i) is not allowed where an individual's gross total income includes income under the heads Interest on Securities, Income from House Property, Capital Gains, or Other Sources (insofar as not immediately derived from personal exertion) and the aggregate of such income exceeds ten thousand rupees. The refund of an annuity deposit is not to be treated as income immediately derived from personal exertion for this purpose.

TDS on compensation to non-resident shareholders requires withholding, with taxable portion determinable on application to tax authorities.
TDS must be deducted on compensation remitted to non-resident shareholders as these amounts are capital receipts liable to capital gains tax; withholding is required under Section 195(1). If the payer believes only part is taxable, an application under Section 195(2) may be made to have the Income-tax Officer determine the taxable portion, and tax is then deducted only on that portion. Calculation guidance for cost of acquisition for shares before and after 1 January 1954 is provided, and companies must furnish required information to Income-tax Officers for determination.

Tax credit for untraceable challans: certified challan copies and supervisory controls required to secure proper arrear adjustment.
Where challans are untraceable the assessee must provide a duly certified true copy of the challan so payment can be verified from the Daily Collection Register; officers must follow the model circular filing procedure and supervisory staff must exercise administrative control to ensure challans are placed in the proper files for accurate arrear adjustment.

Business expenditure: contributions to Consumers' Subsidy Funds are deductible and subsidies received are taxable business income.
Contributions by textile mills to Consumers' Subsidy Funds are deductible as business expenditure being laid out wholly and exclusively for business purposes, and subsidies received by the mills from those funds are revenue receipts treated as taxable business income.

Adjournment restrictions: Assessing officers must limit and carefully grant adjournments when passing assessment orders to prevent delay.
Assessing officers must avoid self initiated or unjustified adjournments and should grant an assessee's request for adjournment only when circumstances pleaded are convincingly genuine and unavoidable; Inspecting Assistant Commissioners must specifically review and note avoidable or unnecessary adjournments to ensure prompt disposal of Category I and II and other revenue yielding assessments.

Tax Deduction at Source from Salaries: guidance on applicability, allowable deductions, surcharge and compliance requirements.
Instructions for tax deduction at source on salaries for 1973-74 apply rates in Part III of the First Schedule to the Finance Bill, 1973. Tax is deductible only where estimated salary exceeds Rs. 5,000. Allowable deductions include profession tax, standard travelling deductions by vehicle category, and qualifying contributions to life insurance, provident funds and specified accounts subject to percentage rules and a cap (first Rs. 2,000 full; 50% of next Rs. 3,000; 40% of balance; overall limit 30% of estimated salary or Rs. 20,000). Rounding, surcharge with marginal relief, proof requirements and criminal penalties for failure to deduct or pay are specified.