Sanction for issue of notice

284

The specified authority for the purposes of sections 280 and 281 shall be the Additional Commissioner or the Additional Director or the Joint Commissioner or the Joint Director.

Explanation

Section Summary:

Section 284 of the Income Tax Act specifies the authorities who are empowered to issue notices under Sections 280 and 281. These sections pertain to the approval process for initiating certain actions, such as reassessment or recovery proceedings. The section clarifies that only higher-ranking officials, such as Additional Commissioners, Additional Directors, Joint Commissioners, or Joint Directors, are authorized to issue such notices.

Key Changes:

This section does not introduce a new concept but clarifies the hierarchy of officials who can issue notices under Sections 280 and 281. Previously, the authority to issue such notices might have been less explicitly defined or delegated to lower-ranking officials. The amendment ensures that only senior-level officers can sanction these actions, adding a layer of oversight.

Practical Implications:

1. For Taxpayers: This change provides an additional safeguard, as only senior officials can initiate actions like reassessment or recovery. This reduces the likelihood of arbitrary or unauthorized notices being issued.
2. For Tax Authorities: The section streamlines the process by clearly defining who has the authority to issue notices, reducing ambiguity and potential disputes over jurisdiction.
3. For Compliance Processes: Taxpayers can expect notices to come from higher-ranking officials, which may lead to more thorough reviews before actions are initiated.

Critical Concepts:

• Specified Authority: Refers to the senior-level officials (Additional Commissioner, Additional Director, Joint Commissioner, or Joint Director) who are authorized to issue notices under Sections 280 and 281.
• Sections 280 and 281: These sections deal with the approval process for initiating reassessment or recovery proceedings. Section 284 ensures that only senior officials can authorize such actions.

Compliance Steps:

1. For Tax Authorities: Ensure that notices under Sections 280 and 281 are issued only by the specified senior officials (Additional Commissioner, Additional Director, Joint Commissioner, or Joint Director).
2. For Taxpayers: Verify the authority of the official issuing the notice to ensure it complies with Section 284.

Examples:

• Scenario 1: A taxpayer receives a notice for reassessment under Section 280. The notice is issued by a Joint Commissioner, which is in line with Section 284. The taxpayer can proceed, knowing the notice is valid.
• Scenario 2: A taxpayer receives a notice for recovery under Section 281, but it is issued by an Assessing Officer (a lower-ranking official). The taxpayer can challenge the notice, as it does not comply with Section 284.

This section ensures that only senior officials can initiate significant actions, providing a safeguard for taxpayers and clarity for tax authorities.