Central Board of Direct Taxes

The Central Board of Direct Taxes, or CBDT, is a statutory body under the Department of Revenue in the Ministry of Finance, constituted under the Central Board of Revenue Act, 1963, that frames the policy for direct taxes and administers the direct-tax laws, chiefly the Income-tax Act, 1961, through the Income Tax Department. It is the apex body of the direct-tax administration and the cadre-controlling authority for the Indian Revenue Service .

This page sets out the Board: what it does, its statutory basis and history, its composition, the field hierarchy it heads from the Principal Chief Commissioners down to the Income Tax Inspector , and the directorates that carry out its specialised work. For the pay of the departmental ranks, see the salary by pay level chart.

What the Board does

The Central Board of Direct Taxes has two roles. It is the policy-making body for direct taxes, providing the inputs for the government’s direct-tax policy and framing the rules and instructions under the tax laws. And it is the administrative head of the direct-tax machinery, supervising the Income Tax Department that assesses and collects the tax.

The principal law it administers is the Income-tax Act, 1961, along with the direct-tax statutes that surround it. The Board issues the circulars and instructions that guide how the Act is applied in the field, sets the jurisdiction of the assessing authorities, and oversees the zones through its Members. It does not itself assess a taxpayer; that is the work of the field formations, from the Income Tax Officer up to the Commissioners. The Board sits above them, at the apex of the hierarchy.

Statutory basis and history

The CBDT rests on an Act of Parliament, which distinguishes it from a body like the Staff Selection Commission that rests on an executive resolution.

It is constituted under the Central Board of Revenue Act, 1963, which came into force on 1 January 1964. Until then a single Central Board of Revenue had handled both direct and indirect taxes; the 1963 Act split it into two boards, the Central Board of Direct Taxes for direct taxes and the Central Board of Excise and Customs for indirect taxes, with effect from that date. The indirect-tax board was later renamed the Central Board of Indirect Taxes and Customs by the Finance Act, 2018, with effect from 29 March 2018, when the Goods and Services Tax reshaped the indirect-tax administration. The direct-tax board has kept its name and its remit throughout. Both boards remain under the Department of Revenue in the Ministry of Finance, so the Ministry oversees direct and indirect taxes through two parallel statutory boards.

Composition

The Board is a small body at the top of a large department. It has a Chairman and six Members, a seven-member board, all drawn from the senior-most ranks of the Indian Revenue Service .

The Chairman is an ex-officio Special Secretary to the Government of India, and the six Members are ex-officio Additional Secretaries. Work is divided among them by portfolio: the standard set covers income tax and revenue, legislation, administration and taxpayer services, investigation, audit and judicial matters, and systems, though the exact allocation is reassigned from time to time. Each Member also supervises a group of field zones. Only fundamental issues are reserved for the full Board acting together; the rest of the work is distributed among the Chairman and the Members, so the Board functions as a set of portfolio heads rather than a standing committee.

The field hierarchy it heads

Below the Board runs the Income Tax Department, a hierarchy that descends through the pay matrix levels from the apex to the entry grades.

The chain matters for how a career runs. The Group A Indian Revenue Service enters at Assistant Commissioner, Level 10, through the UPSC examination or by promotion from the departmental cadre. The Group B cadre enters below, as an Income Tax Inspector at Level 7 through SSC CGL , rises to Income Tax Officer at Level 8, and can cross into the Group A service at Assistant Commissioner. The SSC CGL salary page sets out the pay of the entry grades and the salary by pay level chart the pay at each level of the climb.

The directorates

Alongside the territorial hierarchy that assesses taxpayers by region, the Board runs a set of directorates for specialised work, each headed by a Director General.

The Investigation directorate conducts search, survey, and enquiry into tax evasion. The Intelligence and Criminal Investigation directorate gathers and analyses financial intelligence. The Systems directorate runs the department’s technology, including the e-filing and the faceless-assessment platforms. The TDS directorate oversees tax deducted at source, and the international-taxation and transfer-pricing wings handle cross-border taxation. These directorates are how the Board carries out the functions that cut across the territorial charges, and an Income Tax Inspector or officer may be posted to one of them for a spell in a career.

Circulars and instructions

A large part of the Board’s day-to-day authority runs through the circulars and instructions it issues. Section 119 of the Income-tax Act, 1961 empowers the Board to issue orders, instructions, and directions to the income-tax authorities for the proper administration of the Act, and those authorities are bound to follow them.

The power has a limit that shapes how the department works. A Board circular binds the officers of the department, so a beneficial circular can be relied on by a taxpayer against the department, but the Board cannot direct an assessing officer on how to decide a particular case, and its circulars do not bind the taxpayer or the courts, which read the Act itself. This is why a change in the Board’s interpretation reaches every charge at once through a circular, while a disputed assessment is still settled by the appellate authorities and the courts on the statute. The Board also notifies the rules under the Act and sets the monetary and territorial jurisdiction of the assessing authorities, which is how the line between an Income Tax Officer and an Assistant Commissioner is drawn.

The cadre it controls

The Central Board of Direct Taxes is the cadre-controlling authority for the Indian Revenue Service (Income Tax), the Group A service that staffs the department from Assistant Commissioner upward. That means the Board manages the recruitment intake, the postings, the promotions, and the cadre strength of the service, in the way the Central Board of Indirect Taxes and Customs does for its own IRS branch on the indirect-tax side. The Group B cadre below, the Officers and Inspectors, is likewise managed within the department under the Board.

Pay in the department

Every rank in the Income Tax Department is paid on the standard central-government pattern set by its pay matrix level: the entry basic, then dearness allowance at 60 per cent, house rent allowance by city, and transport allowance , less the deductions. A Level 7 Inspector draws an in-hand of about Rs. 83,000 in an X-class city, a Level 8 Officer about Rs. 88,000, and a Level 10 Assistant Commissioner about Rs. 1,01,000. The SSC CGL salary and income tax inspector salary pages set out the entry grades, and the 7th CPC salary calculator computes the take-home for a chosen level and city.

See also

• Income Tax Inspector salary
• Income Tax Officer
• Indian Revenue Service
• SSC CGL
• SSC CGL salary
• Salary by pay level
• Salary by pay level calculator
• 7th CPC salary calculator
• Staff Selection Commission
• Department of Revenue
• Central government jobs
• Pay matrix
• 7th Central Pay Commission
• Take-home salary of central government employees
• Dearness allowance
• House rent allowance
• Transport allowance
• Income tax for government employees
• National Pension System
• Central government employees in India

External references

• Income Tax Department
• Central Board of Direct Taxes
• Department of Revenue, Ministry of Finance
• Central Board of Indirect Taxes and Customs
• Central Board of Revenue Act, 1963