Rules 130, 131, and 132 of the Draft Income-tax Rules, 2026 establish a structured and time-bound framework for proceedings under section 274. Rule 130 prescribes strict timelines for the Commissioner’s actions: directions under section 274(3) must be issued within one month from the end of the month in which compliance with notice under section 274(2) occurs; references to the Approving Panel under section 274(4) must be made within two months from the end of the month in which the assessee’s final submission is received. Further, directions to the Assessing Officer in Form No. 63 must be issued within one month where a reference is received under rule 129(4)(a), and within two months where the case falls under rule 129(4)(b). Rule 131 outlines the procedure before the Approving Panel: the Chairperson must circulate the reference among members within seven days and issue notices to both the Assessing Officer and the assessee, granting an opportunity of hearing with specified date and place. The Panel may hold meetings at a place of its choice. Rule 132 provides for remuneration, granting the Chairperson and members a sitting fee of ₹6,000 per day along with travelling and daily allowances equivalent to those admissible to a Special Secretary to the Government of India. The expenditure of the Panel is to be met from the Department of Revenue’s budgetary grants.
Extract of Rule No. 130, 131, 132 of Draft Income-tax Rules, 2026
Rule 130
Time limits.
(1) For the purposes of section 274, the Commissioner shall-
(a) not issue directions under section 274(3) after the expiry of one month from the end of the month in which the date of compliance of the notice issued under section 274(2) falls;
(b) not make any reference to the Approving Panel under section 274(4) after the expiry of two months from the end of the month in which the final submission of the assessee in response to the notice issued under section 274(2) is received;
(c) shall issue directions to the Assessing Officer in Form No. 63, —
(i) in the case referred to rule 129(4)(a), within a period of one month from the end of month in which the reference is received by him; and
(ii) in the case referred to in rule 129(4)(b) within a period of two months from the end of month in which the final submission of the assessee in response to the notice issued under section 274(2) is received by him.
Rule 131
Procedure before the Approving Panel.
(1) Upon receipt of reference under rule 129, the Chairperson of the Approving Panel shall cause, —
(a) the reference is circulated among the other members within seven days from the date of receipt of such reference;
(b) a notice is issued to both the Assessing Officer and the assessee, affording an opportunity of being heard specifying therein the date and place of hearing.
2) The meetings of the Approving Panel shall take place at such place as the Approving Panel may decide.
Rule 132
Remuneration.
(1) For attending the meeting of an Approving Panel, the Chairperson and other members of the said Panel shall be entitled to —
(a) a sitting fee of six thousand rupees per day; and
(b) travelling allowances including transportation charges for local travel and daily allowances (including accommodation) as admissible to an officer of the rank of Special Secretary to the Government of India.
(2) The expenditure of an Approving Panel shall be met from the budgetary grants of the Department of Revenue in the Ministry of Finance of the Central Government.
