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    Supervisory power of Joint Commissioner permits binding directions in pending assessments, with a hearing before any prejudicial direction.
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    Best judgment assessment: requirement of notice and opportunity to be heard before AO determines taxpayer's liability under reformed assessment framework.
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    Assessment procedure modernization strengthens mandatory intimation and centralized processing, enhancing taxpayer engagement and procedural certainty.
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    Faceless tax administration: broad power to frame schemes and modify statutory application for digitalised tax processes.
    Clause 532 authorises the Central Government to make schemes by notification for any purpose under the Income Tax Bill, 2025, aiming to enhance efficiency, transparency, and accountability by reducing taxpayer-official interface and optimising resource utilisation. For implementation, the Government may issue notifications that disapply or modify provisions of the Act, and may amend schemes previously framed under the 1961 Act; every such notification must be laid before each House of Parliament. The Board may be empowered to make schemes subject to control of the Central Government.
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    Valuation references: statutory regime for Valuation Officer reports, with procedural safeguards and enforceable reporting timelines.
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    Inquiry before assessment: AO empowered to call for documents and order special audits, with senior approval and procedural safeguards.
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    Self-assessment obligation: pay tax, interest and fees before filing return, with proof, or face default consequences.
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    Verification of returns: clarified authorised signatories and integration of insolvency professionals, with some procedural ambiguities remaining.
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    Electronic filing rules broaden CBDT authority to require verification, disclosures, and secure transmission for tax returns.
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    Return filing modernization enables rulemaking for electronic forms, verification, and document on demand in a risk based regime.
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    Tax Return Preparer scheme shifts operational detail to subordinate legislation, increasing administrative discretion and need for oversight.
    Clause 264 empowers the Central Board of Direct Taxes to notify a Tax Return Preparer scheme allowing specified non corporate, non audited persons to have returns prepared and furnished through authorised TRPs. The clause retains exclusions for audit required entities and certain disqualified persons, mandates scheme notification as per the statutory procedure, and delegates operational details-qualifications, authorisation period, code of conduct, duties, withdrawal and disciplinary mechanisms-to subordinate legislation, increasing administrative flexibility while placing emphasis on oversight, transparency, and transitional arrangements.
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    PAN-Aadhaar authentication strengthens transaction traceability and imposes reciprocal verification duties on parties.
    Clause 262(9) requires every person entering into prescribed transactions to quote and authenticate their PAN or Aadhaar and obliges recipients of transaction documents to ensure such quoting and authentication, with authentication involving verification against demographic or biometric information through prescribed authorities and modalities to be specified by the CBDT.
    Act RulesBills
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    Permanent Account Number and Aadhaar integration expands mandatory identification and digital authentication for specified transactions and filings.
    Clause 262 consolidates allotment, quoting and authentication of the Permanent Account Number and integrates PAN with Aadhaar by mandating application and quoting obligations for specified classes, enabling voluntary applications, requiring intimation of changes, prohibiting multiple PANs, and empowering rule-making and notification to prescribe transactions, authentication procedures and exemptions; it permits Aadhaar linkage and use in lieu of PAN, contemplates inoperative PAN for non-intimation, and relies on Rules 114AAB, 114B, 114BA and 114BB for operational detail while triggering penalties under the existing framework modeled on Section 272B.
    Act RulesBills
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    Mandatory Return Filing expands scope and tightens timelines while enabling updated returns with safeguards.
    Clause 263 consolidates and expands return-filing obligations by listing classes of mandatory filers, requiring threshold income computation without regard to specified exemptions, defining key terms such as beneficial owner and specified entity, prescribing differentiated due dates, authorising rule-making for electronic filing and return particulars, providing a nine-month window for belated and revised returns, maintaining a forty-eight-month updated return regime subject to specified exclusions, and setting a procedure for defective returns with a rectification period and potential invalidation if unrectified.
    Act RulesBills
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    Controlled disclosure of taxpayer information limited by a public interest test, with executive power to restrict access and final administrative decisions.
    Clause 258 authorises income tax authorities to disclose information obtained in the discharge of their functions to other tax, duty, cess, or foreign exchange authorities and to notified bodies, constrained by necessity and a public interest limitation; it allows private parties to apply for information subject to satisfaction of senior tax officials and renders disclosure decisions final and non justiciable, while empowering the Central Government by notification to restrict furnishing of information for specified classes of assessees or authorities.
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    Deemed judicial status for tax proceedings brings perjury and court grade procedural safeguards to tax adjudication processes.
    Clause 257 treats proceedings before income tax authorities as judicial proceedings and deems those authorities to be Civil Courts for specified sections of the Bharatiya Nyaya Sanhita, 2023 and the Bharatiya Nagarik Suraksha Sanhita, 2023, thereby subjecting participants to penal provisions for false evidence, insult to authority, and related offences while preserving a complaint based procedural safeguard for initiating prosecutions through the income tax authority.
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    Faceless collection of information: executive empowered to implement digital, non interface tax information schemes with parliamentary oversight.
    Clause 260 empowers the Central Government, by notification, to create a faceless collection of information scheme for calling for and collecting tax information, inspecting company registers, and exercising assessing powers, enabling elimination of physical interfaces, centralised resource optimisation, team based dynamic jurisdiction, and exceptions or modifications to other statutory provisions to implement the scheme, with the requirement that notifications be laid before both Houses of Parliament.
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    Powers of competent authority: generic clause grants Assessing Officer equivalent enquiry powers, raising definition and safeguard concerns.
    Clause 256 gives a competent authority the power to make any enquiry under the Act with all the powers of an Assessing Officer, mirroring Section 135 of the 1961 Act but replacing an enumerative list of officials with a generic term whose scope depends on definitions and notifications; the clause defers procedural safeguards to the general framework of the Act, making clear definition and transparent designation critical to avoid arbitrariness and jurisdictional overlap.
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    Inspection of company registers enables tax units to verify ownership and financial interests under faceless assessment reforms.
    Inspection of company registers authorises specified income-tax authorities to inspect and copy registers of members, debenture holders and mortgagees to verify ownership and transactions; such inspections require specific written authorisation and Clause 255 expands exercisable authority to unit-based entities like assessment and verification units, enabling centralized and faceless access while raising questions on necessity thresholds, coverage of electronic records, and procedural safeguards.

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      Amendments to the Code of Civil Procedure, 1908 by the Amendment Act 46 of 1999 and Amendment Act 22 of 2002 upheld by the Supreme Court.

      9 June, 2022

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      2002 (10) TMI 796 - Supreme Court

      Amendments  to the Code of Civil Procedure, 1908 by the Amendment Act 46 of 1999 and Amendment Act 22 of 2002 upheld by the Supreme Court.

      Certain writ petitions have been filed seeking to challenge Amendments made to the Code of Civil Procedure, by the Amendment Act 46 of 1999 and Amendment Act 22 of 2002.

      Writ Petition (civil) 496 of 2002 was filed by Salem Advocate Bar Association and after notice was issued the petitioner sought leave of this Court to withdraw the writ petition. The court declined the request to withdraw the writ petition. The petition had been filed in public interest.


      The amendments sought to be made by the above amendment acts (Amendment Act 46 of 1999 and Amendment Act 22 of 2002) have been challenged but the hon'ble apex court refused to strike down the aforesaid amendments on the ground that there was no infirmity in the same.

      Summons to the Defendant within 30 days.

      A clarification was sought on an amendment made to Section 27 dealing with summons to the defendant. It has to be done within 30 days from the date of the institution of the suit. The hon'ble court clarified that object of this section is to avoid long delay in issue of summons for want of steps by the plaintiff. If all that is required to be done by a party is duly performed then compliance has been done by the party and no fault can be attributed to the party. The objective being, if a party concerned has taken steps to file the process fee along with completing the other formalities which are required to enable the court to issue the summons then such a party is not at fault.

      Arbitration, Conciliation, Judicial Settlement and Mediation.

      Section 89 introduced in the Code of civil procedure, 1908:

      It speaks of settlement of disputes outside the court through arbitration,conciliation, judicial settlement including settlement through Lok Adalat and mediation. Held that it being imperative that resort should be had to Alternative Dispute Resolution Mechanism with a view to bring to an end litigation between the parties at an early date. The parties shall follow the procedures as provided by the mechanism and accordingly appropriate rules be framed with regard to mediation.

      The ADR mechanism is successful in most of the countries but if a matter is not settled through conciliation or mediation or judicial settlement despite efforts being made, the case will ultimately go to trial.

      Section 89 is a new provision and even though arbitration or conciliation has been in place as a mode for setting the disputes, this has not really reduced the burden on the courts. Thus the court suggested that certain modalities have to be framed to make this amendment work. It being suggested to form a Committee to ensure that the amendments made become effective and result in quicker dispensation of justice.
      Any creases which require to be ironed out can be identified and apprehensions which may exist in the minds of the litigating public or the lawyer's clarified.

      A model case management formula as well as rules and regulations which should be followed while taking recourse to the ADR (Alternative Dispute Resolution) is referred to in Section 89. The model rules, with or without modification, which are formulated may be adopted by the High Courts concerned for giving effect to Section 89(2)(d).

      Intra Court Appeal.

      Section 100A which deals with intra-court appeals was absolutely fine as opined by the hon'ble court. No prejudice would be caused to the litigants by not providing for intra-court appeal, even where the value involved is large. The High Court by Rules, can provide that the Division Bench will hear the regular first appeal. A further right of appeal where the amount involved is nominal to a Division Bench will be increasing the workload of courts unnecessarily.

      Rejection of the Plaint.

      Order 7 Rule 11 to which Clauses (e) and (f) have been added which enable the court to reject the plaint where it is not filed in duplicate or where the plaintiff fails to comply with the provisions of Rule 9 of Order 7. There may not be an automatic rejection of the plaint at the first instance. The court should give an opportunity to rectify the defect and if the same not being done the court will have the liberty or the right to reject the plaint.

      Examination of Chief of the Witnesses.

      Order 18, Rule 4 has been substituted and Sub-rule (1) provides that in every case examination-in-chief of the witnesses shall be on affidavits and copies thereof shall be supplied to the opposite parties by the party who calls them for evidence.

      It being contended that it may not be possible for the party calling the witness to compel the witness to file an affidavit. It often happens that the witness may not be under the control of the party who wants to rely upon his evidence and that witness may have to be summoned through court.

      Order 16 Rule 1 provides for list of witnesses being filed and summons being issued to them for being present in court for recording their evidence. Rule 1A, on the other hand, refers to production of witnesses without summons where any party to the suit may bring any witness to give any evidence or to produce documents.

      Held by the apex court, reading the provisions of Order 16 and Order 18 together it appears to us that Order 18 Rule 4(1) will necessarily apply to a case contemplated by Order 16 Rule 1A, i.e. where any party to a suit, without applying for summoning under Rule 1 brings any witness to give evidence or produce any document. In such a case, examination-in-chief is not to be recorded in court but shall be in the form of an affidavit.

      Held that whether a witness shall be directed to file affidavit or be required to be present in court for recording of his evidence is a matter to be decided by the court in its discretion having regard to the facts of each case.

      Evidence of a witness to be taken by the Court or by the Commissioner.

      Order 18 Rule 4(2) gives the court the power to decide as to whether evidence of a witness shall be taken either by the court or by the Commissioner.

      An apprehension was raised to the effect that the court has no discretion and once it decides that the evidence will recorded by the Commissioner then evidence of other witnesses cannot be recorded in court.

      The hon'ble bench did not agree to the above contention. The Court has a discretion to either record the evidence in Court or through Commissioner or either of them.

      Order 18 Rule 4(3) provides that the evidence may be recorded either in writing or mechanically in the presence of the Judge or the Commissioner. The use of the word 'mechanically' indicates that the evidence can be recorded even with the help of the electronic media, audio or audio-visual, and whenever the evidence is recorded by the Commissioner it will be advisable that it should be done simultaneously,at least an audio recording of the statement of the witnesses so as to obviate any controversy at a later stage.

      Held by the court that Rule 17A has been deleted by the Amendment Act, 2002 with a view that unnecessarily applications are not filed primarily with a view to prolong the trial. The contention of the counsel as to deletion may cause hardship to the litigants was not accepted by the hon'ble court.

      Memorandum of Appeal.

      Rule 9 which was inserted in Order 41 states of "Registry of memorandum of appeal". The court from whose decree an appeal lies shall entertain the memorandum of appeal and shall endorse thereon the date of presentation and shall register the appeal in a book of appeal kept for that purpose. This book be called the register of appeal.
      It being a clear proposition of law that an appeal is to be filed under Order 41 Rule 1 in the court in which it is maintainable.

      Order 41 Rule 9 contemplates that a copy of memorandum of appeal which has been filed in the Appellate Court should also be presented before the court against whose decree the appeal has been filed and endorsement thereof shall be made by the decreeing court in a book called the Register of Appeals.

      The intention of the Legislature being that the court against whose decree an appeal has been filed should be made aware of the factum of the filing of the appeal which may or may not be relevant at a future date.

      Now just because a memorandum of appeal is not filed under Order 41 Rule 9 will not, to our mind, make the appeal filed in the appellate court as a defective one.

      The hon'ble court  hoped that the amendments made in the Code of Civil Procedure would help in expeditious disposal of cases in the trial courts and the appellate courts.

      The hon'ble apex court further held, that a copy of the judgment of the present matter/writ petition be sent to the Registrars of all the High Court’s so that necessary action can be taken by the respective High Courts and any writ petition pending in those High Courts can be formally disposed of.

      Thus the amendments made to the Code of Civil Procedure, 1908 by the Amendment Act 46 of 1999 and Amendment Act 22 of 2002 were upheld/guarded by the hon'ble apex court in the present Writ Petition (civil) 496 of 2002.

      Procedure is an enabling tool to achieve the objectives of equity and justice. It may not be easy to challenge the same by way of invoking the writ jurisdiction/s.

       

       


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      2002 (10) TMI 796 - Supreme Court

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