Employer reservation to discontinue pension scheme does not automatically render trust revocable, approval need not be withheld.
A reservation permitting the employer to discontinue contributions does not automatically render an otherwise irrevocable superannuation trust revocable; the trust corpus remains vested in the trustees and such a reservation does not, by itself, offend the conditions of rule 3 of Part B of the Fourth Schedule, so approval need not be withheld for that reason, although the commissioner may act, including withdrawing approval under rule 2, if specified events occur.

Reopening assessments: request direct Supreme Court reference where High Court conflict exists on adding barred items.
Instruction requires Commissioners to have Departmental Representatives request the Tribunal to make a direct reference to the Supreme Court where High Courts conflict on whether a valid reopening of assessment for one category permits bringing time barred items into charge; CsIT to issue instructions and DRs to seek such references, including when the assessee seeks a reference.

Exemption for employee foreign travel allowances limited to amounts actually spent; unspent savings are taxable.
Section 10(14) exempts allowances only to the extent expenses are actually incurred; central and state government daily foreign-tour allowances are exempt without that actual-spend requirement for Indian citizens. Allowances paid by other employers for foreign tours are exempt only to the extent spent, and any unspent foreign exchange brought back to India is not eligible for exemption. Tax officers should verify actual expenditure for non-government employees claiming such exemptions.

Extension of assessment time unavailable when reassignment follows a pending reference; verify references before assigning assessment functions.
Extension of assessment time under the proviso to assessment time-limits is not available where the assessing officer has made a reference to a higher income-tax authority and the assessment functions for that year are subsequently assigned to that higher authority; chief commissioners must verify pending references before reassigning assessment responsibility.

Right of custody of seized documents: owner's objection can bar an employee from copying seized books.
Section 132(9) grants the person from whose custody books or documents are seized the right to make copies or extracts; "custody" entails control or actual/constructive possession tied to legal duty. The decisive consideration is the person to whom the documents relate and against whom they will be used. If the assessee objects to an employee making copies of documents of which the assessee is owner, the assessing officer may refuse permission and the assessee alone is entitled to the benefit of Section 132(9).

Tax treatment of posthumous leave pay: exempt when payment is a family benefit, not income from employment.
The cash equivalent of leave salary paid to the legal heirs on the death of a Government servant is a posthumous family benefit and not remuneration from an employer to an employee; the deceased had no right to the amount and it is a financial benefit payable only because of death, and therefore the payment is not liable to income-tax.

Tax Holiday for Free Trade Zone units: complete multi year exemption under new section 10A and anti avoidance rules on trusts.
The Finance Act, 1981 specifies income tax and withholding rates, reduces corporate surcharge, raises personal exemption and revises slab structure; introduces section 10A granting a complete multi year tax exemption for qualifying industrial undertakings in designated free trade zones with conditions on formation, machinery use and carry forward of allowances; increases standard deductions and certain allowances; expands anti avoidance provisions by treating associations with indeterminate shares and undisclosed oral trusts as taxable at the maximum marginal rate unless properly disclosed; and introduces advance surtax payment, interest and penalty mechanisms alongside appellate fee increases and related compliance measures.

Official residence exemption permits retrospective tax relief for judges' rent free accommodation and HRA, enabling rectification and refunds.
Exemption from income tax for the value of rent free official residence and House Rent Allowance granted to High Court and Supreme Court judges is provided by sections 22 D and 23 D (effective 1 April 1975) and operates notwithstanding the Income tax Act; assessing officers must rectify completed assessments and apply the exemption in pending assessments, allowing refunds where due.

Recovery certificate verification: require confirmation of advance tax payments before enforcement and suspend coercive recovery steps.
Require ITO verification of filed returns and challan evidence before issuing recovery certificates for advance tax arrears and ensure payments are posted in the D & C register; if verification is incomplete by the sec.231 deadline, the recovery certificate must note the assessee's claim and the TRO should be asked to withhold coercive steps until the ITO confirms actual arrears. Periodic review from September is required; instructions apply prospectively from 1980-81 and retrospective verification for 1978-79 and 1979-80 must be completed by 30 September 1981.

Supply of return forms reverted to prior distribution: counters, bulk employer supply, and post-by-request available.
Earlier instructions to send return forms automatically to all assessees above the taxable limit are withdrawn and the Department reverts to prior practice: forms to be available across counters and selected post offices, taken in bulk by practitioners, supplied in bulk to heads or public relations officers of organisations for salaried employees, and sent by post promptly on specific request; this circular supersedes the earlier directions and officers must be instructed immediately.

High court decision review and lists of refused special leave petitions require official circulation to concerned officers.
Summarises the Board's administrative handling of High Court decisions considered for the calendar year 1980 and sets out two appended lists: Annexure A of cases where High Courts refused leave to appeal and the Board accepted that refusal, and Annexure B of cases where the Supreme Court did not grant special leave petitions; directs prompt circulation to officers and authorised representatives.

Place of assessment: direct tax payments should be made where a taxpayer is assessed to secure prompt credit.
Place of assessment should determine where payments of direct taxes (other than tax deducted at source) are made so departmental receipted challans reach the assessing Income-tax Officer promptly and taxpayers receive timely credit. Tax deducted at source payments must be made at the Income-tax Office location where the deductor files prescribed TDS statements. Taxpayers with accounts at authorised bank branches should tender cheques at those branches to obtain immediate receipted challans, avoid Clearing-House delays, reduce administrative overhead and enable immediate correction of misclassified payments.

Investment allowance reserve: reserve requirement and carry forward limits govern allowance utilisation and reserve adequacy under section 32A
Investment allowance is admissible in the year of installation or the immediately succeeding year subject to creation of a statutory reserve equal to seventy-five per cent of the amount actually allowed, to be debited to the profit and loss account. Only so much of the allowance as reduces total income to nil may be utilised each year, with the balance carried forward to subsequent assessment years. Cumulative reserves created in the year of installation or later may be aggregated to satisfy the reserve requirement, and an assessee may create a reserve exceeding current year profits without denial solely for that reason.

Registration under sections 184 and 185 denied where firm violates liquor licence conditions; examine local excise rules before registration.
The Punjab & Haryana High Court concluded that entitlement to registration under sections 184 and 185 depends on compliance with excise statutes and licence conditions; where a firm conducted liquor sales in breach of the Punjab Excise Act and the Punjab Liquor Licence Rules, 1956-specifically by involving persons whose names were not endorsed on the licence in contravention of Rule 37 sub rule 26-it could not be treated as entitled to registration. Officers are directed to examine local liquor licence rules and endorsement requirements before granting partnership registration.

High Court decisions summary prompts listing of special leave petitions and circulation to tax officers for review.
Directive to prepare and circulate summaries of High Court decisions on income tax for the specified period, excluding cases already considered by the Board, and to provide two annexures: one listing cases where High Courts refused leave to appeal but the Board accepted review, and another listing matters where special leave petitions were not granted by the Supreme Court; copies to be circulated promptly to officers and authorised representatives.

Gift-tax exemption for non-monetary gifts clarified to cover movable and immovable property under the statute.
Exemption under Section 5(1)(v) of the Gift-tax Act is not confined to cash donations and applies to all types of property, movable or immovable; the Board has withdrawn prior guidance limiting the exemption to monetary gifts and instructs Commissioners to apply the exemption to non-monetary transfers in administration.

Self-assessment tax verification: use Part II of returns to detect non-payment and short payment of tax promptly.
Instruction directs Income Tax officers to use Part II of the return, which shows total tax payable and pre-assessment taxes including self-assessment tax, to detect non-payment or short payment of self-assessment tax in company returns meeting the prescribed threshold and in non-company returns earmarked for scrutiny; recipients must acknowledge receipt.

Hearing schedule compliance requires recording hearing dates and advance notice of adjournments to taxpayers, plus display of cancellations on noticeboards.
ITOs must include a column for the date of hearings in assessment orders to enable supervisory monitoring, and where hearings are cancelled or adjourned the assessee must be informed in advance by letter or telephone where possible; cancellations or adjournments must also be displayed on the ITO's office notice-board and on the department's general notice-board, and necessary instructions issued to subordinate officers to ensure compliance.

Deduction of tax at source from lottery winnings requires specified withholding rates, procedural certificates, and timely remittance.
Deduction at source under Section 194B requires withholding income-tax from lottery and crossword puzzle winnings above the exempt threshold at rates specified for natural persons and companies; tax is calculated on aggregate cash and cash-equivalent prizes, withheld on actual payment (including instalments), rounded to the nearest rupee, remitted to Government within prescribed timeframes, and accompanied by prescribed certificates and quarterly statements, with provision for a recipient to obtain a certificate authorising lower or nil deduction.

Write-off procedure for tax arrears requires composite proposals and interest-inclusive totals before zonal committee review.
Submission of a single composite proposal is required where an assessee has arrears under income-tax and other direct taxes, to be sent on the prescribed proforma with complete assessment records; every proposal must state the total arrears inclusive of interest chargeable for late payment calculated up to the end of the month preceding zonal committee consideration.