Change of incumbent of an office.

244(1)

Whenever, in respect of any proceeding under this Act, an income-tax authority ceases to exercise jurisdiction and is succeeded by another who has and exercises jurisdiction, the income-tax authority so succeeding may continue the proceeding from the stage at which the proceeding was left by his predecessor.

244(2) Before the proceeding referred to in sub-section (1) is so continued, the

assessee concerned may demand that––

• (a) the previous proceeding or any part thereof be reopened; or
• (b) he be reheard before any order of assessment is passed against him.

Explanation

Section Summary:

Section 244 of the Income Tax Act deals with the continuity of proceedings when there is a change in the income-tax authority handling a case. If the authority in charge of a case (e.g., an Assessing Officer) is replaced by another authority, the new authority can continue the proceedings from where the previous authority left off. However, the taxpayer (assessee) has the right to request either a reopening of the previous proceedings or a rehearing before any final assessment order is passed.

Key Changes:

This section is not a new addition but clarifies the process of transitioning cases between income-tax authorities. It ensures that proceedings are not disrupted due to a change in personnel and provides safeguards for taxpayers to ensure fairness.

Practical Implications:

1. For Taxpayers: If a new income-tax authority takes over a case, the taxpayer can request a rehearing or reopening of the proceedings. This ensures that the taxpayer is not disadvantaged by the change in authority and can present their case afresh if needed.
2. For Tax Authorities: The new authority can seamlessly continue the proceedings without starting from scratch, which saves time and resources. However, they must honor the taxpayer’s request for a rehearing or reopening if demanded.

Critical Concepts:

• Income-tax authority: Refers to officials like Assessing Officers, Commissioners, or other designated personnel responsible for handling tax cases.
• Proceeding: Any ongoing process related to assessment, reassessment, or other tax-related matters under the Income Tax Act.
• Rehearing: The taxpayer can request that the new authority hear their case again before making a decision.
• Reopening: The taxpayer can ask for specific parts of the previous proceedings to be reviewed again.

Compliance Steps:

1. For Taxpayers:
   • If a new authority takes over your case, review the status of the proceedings.
   • If you believe the change in authority affects your case, formally request a rehearing or reopening of the proceedings before the new authority passes any order.
2. For Tax Authorities:
   • Ensure continuity of proceedings from the stage where the previous authority left off.
   • If the taxpayer requests a rehearing or reopening, comply with the request before proceeding further.

Examples:

• Scenario 1: Mr. Sharma is undergoing an income tax assessment. Midway through the process, the Assessing Officer handling his case is transferred, and a new officer takes over. The new officer can continue the assessment from where it was left. However, Mr. Sharma feels that the new officer may not fully understand his case, so he requests a rehearing. The new officer must rehear the case before finalizing the assessment.
• Scenario 2: A business is under scrutiny for tax evasion. The original authority handling the case is replaced. The business owner requests that certain documents reviewed by the previous authority be reopened for re-examination. The new authority must comply with this request before proceeding.

This section ensures procedural fairness while maintaining efficiency in tax administration.