Rectification procedure for old-Act assessments should follow old-act provisions; misnaming the section does not invalidate orders.
Rectification of assessments completed under the old Act should be pursued under the old Act provision rather than under the new Act; however, appellate decisions recognise that an order will not be invalid merely because the assessing officer cited the wrong section if the officer had the substantive power and the conditions for its exercise were the same under either provision. The Board advises citing those High Court decisions where relevant and recommends using the old Act provision in assessment proceedings to avoid procedural criticism.

Tax recovery responsibilities reassigned to Additional CIT(Recovery), centralising recovery, stays and withholding of refunds and oversight.
The Board created 32 Additional Commissioners of Income Tax at the intermediary grade, allocating one to each territorial Commissioner to perform administrative, statutory and non statutory technical functions so as to relieve Commissioners for managerial duties. In Bombay, Calcutta and Delhi a dedicated Additional CIT(Recovery) will handle tax recovery including stays of demands, withholding of refunds under section 241, review of quarterly arrear proforma and Tax Recovery Commissioner duties, while write off of irrecoverable demands remains with the Commissioner. A legislative amendment is proposed and the scheme will be reviewed after six months with statistical reporting and performance review by the Member in charge.

Assessment omissions cause appellate interference; ensure procedural safeguards so assessing officers can examine and rebut fresh evidence.
Pilot review identified recurring assessment omissions and procedural lapses causing appellate interference; many additions reversed on appeal resulted from failures to present or record relevant material at assessment. The Board directed Commissioners to alert assessing officers to these pitfalls and instructed appellate authorities to afford assessing officers opportunity to examine and rebut fresh evidence produced at appeal.

Income from other sources: instruction to classify certain parliamentary salary receipts accordingly pending higher court reference.
Salary of a Member of Parliament is administratively to be treated as income from other sources with expense allowance rules as set out in the Board's circulars; a contrary tribunal view classifying the salary as income from vocation is under departmental challenge by reference to the High Court and should not be followed except in that specific case.

Advance tax accounting: separate treatment for income tax, union surcharge and special surcharge required for registered firms.
Advance tax collections must be split into separate sub-heads for income-tax and Union Surcharge; advance payments representing the special surcharge on registered firms are to be accounted for under a distinct sub-head "Advance payments of tax" opened beneath the minor head Surcharge (Special) under the major head for taxes on income other than corporation tax, with Comptroller & Auditor General directions issued to Accountant Generals and immediate implementation required.

Deductibility of settlement income tax liability as debt reduces net wealth for relevant valuation dates under wealth tax rules.
Additional income tax liabilities determined in settlement proceedings are deductible as debts for the valuation date relevant to each assessment year when computing net wealth; this differs from liabilities arising from voluntary disclosure, which are not to be deducted for prior valuation dates. The Board directs issuance of instructions to Wealth Tax Officers to apply this deductible treatment, relying on Supreme Court precedents on the characterisation of such tax liabilities.

Finality certificate requirement for double tax relief; relief withheld without certificate, payment may be held in abeyance.
Double taxation relief under the India-Ceylon agreement shall not be granted without the Ceylon finality certificate (Form No.50E) establishing the final assessed income; provisional assessment documents are inadequate. If the finality certificate is delayed beyond the Agreement's period, the Income-tax Officer may keep payment of tax relating to the doubly taxed income in abeyance where the assessee adduces proper evidence that the delay was not caused by the assessee.

Tax deduction at source on salary: apply Finance Bill 1970 rates with specified deductions, travel allowances, rounding and penalties.
Directives require employers to deduct tax at source from salaries for 1970-71 at Finance Bill rates, subject to a non-deduction threshold; permit specified proportions of life insurance, provident fund and certain post-office deposits as deductions within an aggregate cap; allow adjustments for profession tax and prescribed travel allowances while excluding donations and books from source deduction; prescribe rounding rules and the treatment of conveyance allowance; and warn of criminal and monetary penalties for failure to deduct or remit tax, with an annex containing the rate schedule and surcharge.

Tax deduction at source on interest on securities must follow prescribed rates with specified exemptions and rounding rules.
Directives require deduction of income tax at source from interest on Government securities at prescribed differentiated rates by payee category and security type, with defined treatment for residents, non residents, domestic and non domestic companies. Deductions are subject to valid exemption or abatement certificates; certain bonds, National Savings instruments and specified exempt recipients require no withholding subject to written declarations and statutory notifications. The circular defines domestic company for this purpose, mandates rounding of tax fractions to the nearest rupee, and advises consulting the Income tax Officer in doubtful cases.

Charitable exemption denied for industry coordination body; member contributions deductible but reimbursements taxable as revenue receipts.
The coordination body does not qualify as a charitable organisation and therefore is not entitled to exemption under charitable-income provisions; it is to be assessed as a commercial organisation. Contributions by member companies to the body are deductible as necessary business expenditure, and payments or reimbursements from the body to members are assessable in the hands of the member companies as revenue receipts.

Confidential correspondence must name the Secretary to ensure delivery to the intended officer and preserve secrecy.
The instruction requires that confidential/secret letters be addressed to the Secretary by name because addressing them only by designation impedes identification of the intended officer and defeats the purpose of marking them confidential; naming the Secretary ensures direct delivery and preserves confidentiality.

Payment-by-cheque requirement for deductible business expenses: non-cheque payments may be disallowed unless exceptions apply, including proof provisions.
Section 40A(3) conditions deduction on payment by crossed bank cheque or crossed bank draft for deductible business expenditures exceeding the monetary threshold; Rule 6DD specifies exclusions (pre existing cash contracts, book adjustments, payments in banking less localities, payments to agricultural and cottage producers, certain banking instruments, payments to financial institutions, and specified terminal benefits) and a residuary exception for exceptional unavoidable circumstances where the assessee proves genuineness and payee identity to the income tax officer.

Maintenance of list of salaried assessees in sensitive duties required to ensure timely service of assessment notices and completion.
Instruction directs IACs to maintain and periodically review a list of salaried assessees in sensitive spheres of duty within their jurisdictions, to ensure notices under the relevant assessment provision are served timely and that assessments are completed without delay.

Arrear reporting: duplicate quarterly statements required with Board review for large arrears and DI to analyse significant arrears.
Quarterly statements must be prepared in duplicate for cases of arrears above the higher threshold; one copy sent to the Board and the other to the Director of Investigation (R.S.&P). The Board will review arrear demands above that higher threshold while existing arrangements continue for other matters. The D.I.(R.S.&P) will prepare an analysis of all arrear demands above the lower threshold, categorised by reasons for non-collection.

Remand procedure: Appellate authorities must issue written remand orders and allow assessees to reply before finalizing orders.
Appellate Assistant Commissioners must issue written remand orders, send copies of the ITO's remand reports to the assessee and obtain their replies before finalizing appellate orders. Appellate orders must mention received remand reports and, where the ITO requests enhancement of income, the Appellate Assistant Commissioner must expressly accept or reject that request.

Favourable appellate tribunal decisions: authorised representatives must notify tax commissioners and promptly ensure nationwide circulation.
Authorised representatives are to take special note of favourable Appellate Tribunal decisions and bring them to the notice of Commissioners of Income Tax; such decisions are to be circulated to all Commissioners and copies sent directly to authorised representatives nationwide as an internal administrative measure to ensure awareness and consistent reference.

Tax exemption for scholarship not available where post-retirement allowance funds project completion, reversing earlier guidance.
The Board determined that the annual allowance to retired research scientists under the CSIR scheme is intended for completion of specific research projects, not for the scientists' education, and therefore does not qualify as a scholarship exempt from tax; the Board's prior instruction treating it as exempt is withdrawn effective 1 January 1970.

Refund entitlement under section 237 requires an assessment before claim and is subject to assessment time limits.
Refund entitlement under section 237 requires a filed return of total income and an assessment or order of assessment by the ITO; only after the ITO computes total income and determines tax properly chargeable can an excess payment be refunded, and refund claims are subject to the same statutory time limits for making assessments, including a one-year extension where the return is filed on the last permissible date.

Export market development allowance: recognised associations must keep segregated accounts and allocate expenses for weighted deduction.
Instruction requires recognised associations receiving subscriptions to maintain proper accounts showing separately expenditures under sections 35B and 35C, have those accounts examined to compute proportions of expenditure on the specified activities, circulate the allocation to assessing ITOs so members may claim weighted deductions, and adjust for any government subsidy or reimbursement before granting deductions; a special circle under each CIT is to be created with a specialist ITO to determine and certify allocable amounts and percentages.

Penalty jurisdiction: instructions confirm inspecting assessing officer retains jurisdiction despite appellate reduction of assessed income.
The Board instructs that where a penalty reference to a higher officer was made because the minimum imposable penalty exceeded the local threshold, appellate reduction of assessment does not divest the Inspecting Assistant Commissioner of jurisdiction; prior circular guidance must be followed and tribunal observations suggesting re examination do not alter this jurisdictional rule.