Sections 241 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 241 lets the Board direct which income-tax authority exercises which powers, over which area, persons, income or cases. Section 242 then says what an Assessing Officer with an area can do: whom he has jurisdiction over, who decides disputes about it and when an assessee may no longer challenge it. This article explains both as per the Income-tax Act, 2025 as amended by the Finance Act, 2026.
The Board assigns jurisdiction by directions and orders, using criteria of territorial area, persons, incomes and cases. An Assessing Officer's jurisdiction follows the place of business (or the principal place) for a business person and the place of residence for anyone else. A question on jurisdiction is decided by the specified income-tax authority. The assessee must raise the objection in time: generally within one month of the notice, or before assessment is completed, whichever is earlier.
By section 1(3), the Act is in force from 1 April 2026, save as otherwise provided. No Finance Act, 2026 amendment is named for these sections. Later amendments, rules and notifications should be checked. For disputes before the department, see our legal dispute resolution service.
Section 241: who exercises which powers
| Sub-section | What it says |
|---|---|
| (1) | Income-tax authorities exercise the powers and functions conferred on them as per such directions as the Board may issue |
| (2) | A higher-ranking authority may, if so directed by the Board, exercise the powers and functions of a lower-ranking authority; that direction is deemed to be a direction under sub-section (1) |
| (3) | The Board's directions may authorise any other income-tax authority to issue written orders for the exercise of powers and functions by authorities subordinate to it |
| (4) | In issuing these directions or orders, the Board or authorised authority may have regard to one or more of: (a) territorial area, (b) persons or classes of persons, (c) incomes or classes of income, (d) cases or classes of cases |
| (5) | Without prejudice to sub-sections (1) to (3), the Board may by general or special order, subject to conditions: (a) authorise a Principal Director General or Director General or Principal Director or Director to perform functions of any other income-tax authority assigned to him; (b) empower the specified income-tax authority to order that the Assessing Officer's powers for a specified area, persons, incomes or cases be exercised by an Additional Commissioner, Additional Director, Joint Commissioner or Joint Director |
| (6) | Where an order is made under sub-section (5)(b), references to the Assessing Officer in the Act and rules are deemed to be references to that officer, and any requirement of approval or sanction of the Joint Commissioner does not apply |
| (7) | The directions and orders may require two or more Assessing Officers to exercise powers concurrently; where officers of different classes do so, the lower-ranking one acts as the higher directs, references to the Assessing Officer are deemed to be to the higher authority, and requirements of approval or sanction of such an authority do not apply |
| (8) | Irrespective of any direction or order under the section, or section 242, the Board may by notification issue any direction for the purposes of furnishing the return of income or doing any other act under the Act or rules by any person or class of persons |
| (9) | The authority exercising powers for the persons in sub-section (8) is the authority specified in the notification |
The notifications and orders that have actually been issued are not in the text consulted, and none is named here.
Section 242: jurisdiction of Assessing Officers
Who falls within an Assessing Officer's jurisdiction: sub-section (1)
Where an Assessing Officer has been vested with jurisdiction over an area by a direction or order under section 241(1), (2) or (3), he has jurisdiction within that area:
- (a) over a person carrying on a business or profession, if the place where he carries it on is within the area, or, where the business or profession is carried on in more places than one, if the principal place is within the area; and
- (b) over any other person residing within the area.
Who decides a dispute: sub-sections (2) and (3)
Where a question arises whether an Assessing Officer has jurisdiction to assess any person, it is determined by the specified income-tax authority. If the question relates to areas within the jurisdiction of different specified authorities, it is determined (a) by the specified authorities concerned, or (b) if they do not agree, by the Board or by such specified authority as the Board may, by notification, specify.
"Specified income-tax authority" is defined in section 243(7) as the Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner; see our article on sections 243 to 245.
Time limits to object: sub-section (4)
No person shall call in question the jurisdiction of an Assessing Officer:
| Case | Cut-off, whichever is earlier |
|---|---|
| (a) The person has made a return under section 263(1) | Expiry of one month from the date on which he was served with a notice under section 268(1) or 270(8), or the completion of the assessment |
| (b) The person has made no such return | Expiry of the time allowed by the notice under section 268(1) or 280(2) for making the return, or by the notice under section 271(2) to show cause why the assessment should not be completed on the Assessing Officer's own judgment |
| (c) Action has been taken under section 247 or 248 | Expiry of one month from the date on which he was served with a notice under section 294(1)(a), or the completion of the assessment |
The Act uses a different term for the assessment under section 271, and the notice in clause (b) is the notice under section 271(2). The Act's own words in clause (b) refer to an assessment completed on the Assessing Officer's judgment.
Reference and powers: sub-sections (5) and (6)
Subject to sub-section (4), where an assessee calls in question the jurisdiction of an Assessing Officer, then the Assessing Officer, if not satisfied with the correctness of the claim, shall refer the matter for determination under sub-section (2) or (3) before the assessment is made.
Irrespective of anything in section 242 or any direction or order under section 241, every Assessing Officer has all the powers conferred on an Assessing Officer in respect of the income accruing, arising or received within the area over which he has been vested with jurisdiction by directions or orders under section 241(1), (2) or (3).
A worked example
Names, places and dates are assumed; the one-month rule is from section 242(4)(a).
Mr. Anil Deshmukh carries on a business from several places, and the principal place of his business lies within the area of Assessing Officer X. He has made a return under section 263(1).
- Under section 242(1)(a), where the business is carried on in more than one place, the Assessing Officer over the area of the principal place has jurisdiction.
- A notice under section 268(1) is served on him on 1 June (assumed). Under section 242(4)(a), he cannot call in question the Assessing Officer's jurisdiction after one month from that date, that is after 1 July, or after the completion of the assessment, whichever is earlier.
- If he raises the objection on 20 June and the Assessing Officer is not satisfied, he must refer the question under section 242(5) for determination by the specified income-tax authority under sub-section (2) (or sub-section (3)) before making the assessment.
Need help with a jurisdiction objection?
The time to object is short, and it runs from the notice or from the completion of assessment, whichever comes first. Our team can review the notice and the position of your principal place of business with you under our legal dispute resolution service.
Key takeaways
- The Board assigns jurisdiction through directions and orders under section 241, by area, persons, incomes or cases.
- Two or more Assessing Officers may be given concurrent jurisdiction.
- A business person falls under the Assessing Officer of the place, or the principal place, of business; any other person under the officer of the area of residence.
- The specified income-tax authority decides jurisdiction questions; the Board decides if authorities disagree.
- Objections must be raised within the time in section 242(4).
Read next
- Sections 243 to 245: transfer of cases, change of incumbent and faceless jurisdiction
- Sections 236 to 240: income-tax authorities, appointment, control, instructions and the Taxpayer's Charter
- Section 246: summons and civil court powers
- Chapter XIV: tax administration
Disclaimer: Based on the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026, as consulted on 2 October 2026. It explains the words of the Act only; the Income-tax Rules, 2026, notifications, circulars, later amendments and the way the tax authorities and courts apply these provisions should be checked. This article is general information, not legal advice; check the official text before acting.