Assessing Officer jurisdiction clarified: officers formerly called Income tax Officer retain authority to act under omitted provisions.
Omission of sections 104-109 does not extinguish administrative action for assessment year 1987-88 and earlier; references to "Income-tax Officer" in those sections are to be read as references to the Assessing Officer (including the Income-tax Officer, Assistant Commissioner, or Deputy Commissioner (Assessment) exercising jurisdiction), and actions under the omitted provisions may be taken pursuant to the General Clauses Act.

Limitation on assessment: assessments under sections 143/144 barred after the two year statutory time limit; instruction directs officers promptly.
Substitution of sub section (1) of section 153 limits assessment orders under sections 143 and 144 to a two year period from the end of the assessment year in which income was first assessable, removes the extended time limits previously available under clauses (b), (c) and (d), and directs Assessing Officers to disregard those extensions and complete outstanding assessments for 1986 87 and earlier by the Board's stated deadline.

Frequent transfer of tax cases should be avoided when exercising delegated transfer powers to preserve jurisdictional stability.
Frequent transfers of tax assessment cases should be avoided when exercising delegated transfer powers; officials exercising delegated authority under the Income-tax Act must keep this recommendation in mind. Transfer authority vests in senior tax officers and Commissioners, and the Board issued central circle retention guidelines specifying periods cases must remain in Central Circles. Subject to those guidelines, administrative practice should favour jurisdictional stability and limit recurrent transfers under the transfer provisions.

Time limits for assessment notices require service within the later of the return's financial year or six months after filing.
No assessment notice may be served after the later of the end of the financial year in which the return is filed or six months from the end of the month in which the return is furnished; Assessing Officers must ensure notices are actually served within that statutory period, with examples provided for computing the six month deadline, and the requirement applies mutatis mutandis to Gift-tax and Wealth-tax assessments.

Depreciation rates: Schedule XIV rates are minimum; higher bona fide technological depreciation may be provided with proper disclosure in accounts.
Schedule XIV and the amended provisions operate effectively from April 1987; companies need not recompute specified period if they follow Circular No.1 of 1986 and may continue old SLM rates for existing assets. Schedule XIV rates are minimum for assets acquired after applicability and lower rates are not permitted; higher rates are allowable on bona fide technological grounds with disclosure. SLM rates must be determined consistent with Schedule XIV, taking into account the Schedule's fractional-year basis.

Discretion to treat taxpayer not in default pending appeal allows suspension of disputed tax demand on application.
Exercise of section 220(6) discretion allows the Assessing Officer, on the assessee's application, to treat the assessee as not in default for amounts attributable to disputed points while an appeal remains pending where there are conflicting High Court interpretations or where the issue was earlier decided in the assessee's favour in the assessee's own case. The concession is limited to disputed amounts, may be withdrawn for non-cooperation or changed legal developments, and in other cases requires a speaking order; financial capacity is not relevant and the guidelines apply to other direct tax laws.

Validity of search-and-seizure orders lapses after sixty days unless Commissioner extends; pre-existing orders must follow procedure.
The Board directs that the procedural limitation causing search-and-seizure orders to cease after a fixed short period unless extended by Commissioner approval be applied to orders passed before 1 April 1989, thereby requiring those pre-existing orders to follow the same extension procedure to remain valid.

Tax deduction certificate requirement: unified Form No.16 must be government printed and supplied to deductors on application.
Form No.16 replaces multiple prior certificate forms and must be furnished to the payee within the period prescribed by the Income-tax Rules, stating prescribed particulars including amount deducted. Form No.16 is to be printed in serially numbered book form by the Central Government and supplied to the person deducting tax on application in Form No.17 to the Commissioner of Income-tax having jurisdiction.

Revised fee schedule updates counsel appointment, appraisal and payment procedures governing income tax litigation representation.
Revised schedule updates fees, retainership and allowances for Senior, Standing and Junior Standing Counsels and prescribes appointment procedures through Chief Justice proposals and Chief Commissioner recommendations; initial one year engagements with renewable multi year terms subject to annual performance appraisal, mandatory consultation with the High Court, advance submission for renewal, and termination on short notice. Duties, private practice limitations, case allocation responsibility, detailed fee items, payment stages, rules for connected and uncontested cases, and definitions of operative terms are set out to govern litigation representation and administrative oversight.

Interest-tax deduction adjustment must promptly trigger simultaneous revision of income-tax assessments to correct taxable profits.
Where a scheduled bank's interest-tax liability is reduced on appeal, revision or other proceeding under the Interest Tax Act, the assessing officer must immediately revise the corresponding income-tax assessment for the relevant year to adjust the deduction previously allowed, and report reviewed cases and additional tax demanded to the Board; future appellate adjustments must be implemented simultaneously and compliance monitored by Deputy Commissioners and Internal Audit.

Pay parity: senior staff to have pay stepped up to match juniors after departmental exam increments, with arrears adjusted.
Two advance increments are allowed to certain Income Tax Department staff on passing the departmental examination; where seniors who passed before 1.1.86 received increments at pre-revised rates and now earn less than juniors, the senior's pay shall be stepped up with reference to the junior from the junior's increment date, pay to be refixed under pay rules, subsequent increment dates aligned, and arrears paid.

Advance increments on passing departmental exams continue under revised pay scales, preserving entitlement for specified income-tax staff grades.
The instruction confirms that the scheme of granting advance increments to LDCs, UDCs, Inspectors of Income-tax, Head Clerks, Supervisors and Stenographers on passing the departmental examination to the next higher grade will continue notwithstanding the revised pay scales effective from 1.1.86, with concurrence of the Department of Expenditure and the Department of Personnel and Training.