Scaling down of tax arrears as a creditor's inherent right permits conditional settlements to facilitate recovery.
Scaling down of tax arrears is an exercise of the creditor's inherent right and requires no statutory provision; it applies where assessments are final and the assessee cannot pay, and settlements must be used only when normal recovery is difficult and yield greater realisation. Such settlements require prompt payment or adequate security for instalments, an affidavit disclosing assets, and are voidable if undisclosed assets later surface. Commissioners retain power to scale down smaller aggregate demands while larger cases require Zonal Committee scrutiny and Board submission.

Interest tax accounting restructured: new minor head and detailed subheads for collection and refunds established.
Creates a new minor head "Collection under Interest Tax Act, 1974" under major head "028 other taxes on Income and Expenditure" and mandates separate sub heads for advance collections, ordinary collections, miscellaneous collections (penalties, interest etc.) and deduct refunds, each differentiated for banks that are companies and banks that are non companies; correction slips to the Major and Minor heads of Account (Third Edition) will be issued to implement the change.

Scaling down of tax arrears permitted where compromise yields greater recovery, subject to payment, security, and asset disclosure.
Scaling down of tax arrears is an administrative right to reduce finalised arrear demands where normal recovery is difficult and compromise yields better realisation; it applies only to cases with final assessments, requires prompt payment, adequate security as needed, and an affidavit of assets, and settlements are void if undisclosed assets later surface. Commissioners retain authority to scale down arrears within a departmental threshold; larger cases must be vetted by zonal committees and submitted to higher Board authorities for approval.

Initial depreciation allowance for specified new plant and machinery enables an extra first-year deduction subject to recapture.
Initial depreciation allowance grants an additional first-year deduction for specified new ships, aircraft, machinery or plant in selected industries, excluding office appliances and road transport vehicles, and including small-scale undertakings under a value threshold. The allowance is calculated as a percentage of actual cost, is excluded from written down value computation in later years, and is taken into account on disposal, demolition, or when cumulative depreciation would exceed cost; it also affects balancing charge and loss calculations and must be recorded beneath the asset's written down value in assessment orders.

Tax treatment of rent-free accommodation: no deduction allowed from salary income under the Income-tax Act.
No portion of the value of rent-free accommodation provided to a Judge is deductible in computing salary income under the Income-tax Act; this rule also applies to High Court occupants, pending assessments are to be completed per the government legal opinion while further instructions on completed assessments are awaited.

Estate duty apportionment should be made uniformly between agricultural and non-agricultural assets under board instruction.
The Board has directed that apportionment of estate duty receipts and refunds under the Estate Duty Act between agricultural and non-agricultural assets be conducted uniformly across estate duty circles according to prescribed lines to remedy divergent practices.

Reconciliation of company registrations to identify firms not on tax records and mandate reporting and annual checks.
The Board instructed that an Inspector be sent to the Register of Companies with Departmental lists to identify companies on the Registrar's records but absent from the Income-tax Department's records, to enquire into those cases and send a complete tally with reasons by the specified deadline; it also mandated annual reconciliation for companies registered in each preceding financial year to ensure timely inclusion on Departmental records.

Proper maintenance of Demand and Collection Register required; internal checks must prevent accounting errors and disciplinary consequences.
Proper maintenance of the Demand and Collection Register is required to ensure accounting accuracy and avoid hardship to assessees. Audit reported defects: incorrect carry forwards, omission of demand and payment particulars, failures in recording collections, and serial irregularities. These lapses can produce erroneous arrears and misstate collections. Officers must introduce effective internal checks to prevent recurrence; future lapses will lead to administrative action and will be reflected in officers' Confidential Character Reports.

Appropriation of seized primary gold allows market value adjustment against tax arrears, subject to gold control confiscation rules.
Primary gold seized in searches under section 132 enters Government custody and, because the Gold (Control) Act does not apply to Government possession, may be considered for appropriation of its market value towards income tax arrears; practical issues include prohibition on private sale, Mint accounting of value, requirement for international rate realisation, and the Gold Control Administrator's view that confiscated gold vested in the Central Government cannot be appropriated except where redemption on payment of fine returns value to the party.

Compulsory deposit: banks must accept deposits from legal heirs and repayment to them discharges bank obligation.
Where a person liable to compulsory deposit dies, the legal representative is liable for sums the deceased would have owed; accordingly legal heirs must make the compulsory deposit when the deceased's taxable income exceeds the threshold. Banks are instructed to accept deposits from those legal heirs and to repay them, and such repayment to the depositing heirs constitutes a valid discharge of the bank's obligation.

Tax deduction at source from salaries updated with revised exemption slab, deduction rules, and procedural safeguards for withholding.
Instructions prescribe withholding of income tax from salaries for financial year 1975-76 according to the amended rate schedule, raising the no tax threshold and setting revised slab rates plus a union surcharge; disbursing officers may adjust intra year deductions to correct prior errors. Taxable salary is computed after applying a standard deduction for employment related expenditure (subject to percentage, maximum and special limits where conveyance or employer vehicles apply), excluding certain exempt payments and deferring inclusion of amounts in Additional Emoluments deposit accounts until repayment. Qualifying deductions for life insurance, provident fund and specified post office deposits are allowed subject to an aggregate ceiling, education expenditure relief for dependents is provided within limits, charitable donations are not deductible at source (with limited exceptions), rounding rules apply, and penalties attach for failure to deduct or remit tax.

Withdrawal of approval for research donation deductions removes tax deduction entitlement for donations to R.N.T. Medical College.
Approval for tax-deductible donations to R.N.T. Medical College, Udaipur was withdrawn retrospectively from 27 March 1974 on the recommendation of the prescribed authority; assessing officers are instructed not to allow deduction for donations to that college.

Income attribution of a minor's partnership share upheld despite assessment of the partner's share to a family entity.
The Tribunal held that where an individual partner admits a minor to the benefits of a partnership, the minor's share of profits is subject to the income-attribution provision, and the fact that the individual's share is assessed as income of a Hindu undivided family does not exclude application of the attribution rule because the individual's status as a partner remains operative.

Reasonable opportunity to be heard required - ensure penalty register maintenance and re-hearing before levying penalties.
Failure to afford a reasonable opportunity of being heard in penalty proceedings led to appellate reversals where officers finalised orders after late service of notices or without re-hearing. Officers must maintain the prescribed penalty register, enter cases promptly after assessment, watch progress, and grant adjournments or re-notify as needed to comply with procedural requirements and prevent loss of cases on appeal.

Certificates of assessment under Article VI(b) enable double taxation relief; authorities instructed to facilitate and prioritize issuance.
Instruction directs tax authorities to inform affected assessees to seek certificates of assessment from the Commissioner of Income-tax, Chittagong or Dacca; to furnish a verified list of cases to the Board by 15-9-1975 for onward transmission to Bangladesh; to prioritize requests from Bangladesh taxpayers for certificates; and notes certificates are relevant only for assessment years up to and including 1971-72.

Refund adjustment controls: ensure entries in ITNS 150 to prevent duplicate set offs and recording lapses.
Refunds adjusted against tax deduction at source liabilities were not entered in I.T.N.S. 150, causing duplicate adjustments when subsequent demands were satisfied from the same refunded amounts; officers must record any set off or adjustment in I.T.N.S. 150 and note refund effects in transfer memoranda to prevent such lapses.

Central Information Branch mandated to centralize tax information collection, with annual inspections and range-level test checks.
The Instruction mandates renaming the Special Investigation Branch as the Central Information Branch, to be placed under an IAC at Commissioner headquarters or constituted where absent by allotting an ITO with Inspectors. The Branch must centrally collect, collate and disseminate information to ITOs, while Survey Circle Inspectors may assist in external collection. Intimation slips must be forwarded to Range IACs for test checks during annual inspection. Commissioners must inspect the Branch annually and avoid functional overlap with Survey Circles; performance standards are deferred pending work-study.

Pre-assessment scrutiny mandated with specified sampling percentages; Inspecting Assistant Commissioners to select and enforce sampling.
The Instruction substitutes post assessment sample scrutiny with pre assessment scrutiny, requires Inspecting Assistant Commissioners to select sample cases and prepare July-August lists communicated to ITOs and Commissioners (reporting to the Board by end of August), assigns enforcement responsibility to the Inspecting Assistant Commissioner, mandates reclassification of selected summary cases as scrutiny in the September report with a footnote, and permits reopening of earlier assessments on substantial grounds under the appropriate statutory provisions while observing time limits.

Bank refusal to accept compulsory deposits: penal provisions not invoked when officer is satisfied of bank non-acceptance.
Where an assessee could not make the mandatory deposit by the prescribed date because banks refused to accept deposits from non-account holders, the Board directed that penal provisions under the Compulsory Deposit Scheme should not be invoked if there is evidence satisfactory to the Income-tax Officer that bank non-acceptance caused the delay, and instructed officers to apply this guidance uniformly.

Deduction under section 35(1)(ii) curtailed after approval cancellation; donors' claims to donations will be disallowed in assessments.
Approval granted to Sir Ganga Ram Trust Society under section 35(1)(ii) has been cancelled retrospectively from 1 April 1973 on the prescribed authority's recommendation, and officers are directed to disallow deduction in donors' individual assessments for donations to the Trust for that period.