Administration of income tax in India had begun as early as 1860. In the initial years, provincial governments administered this tax. The organizational history of the Income Tax Department starts from the year 1922, when the
IncomeTax Act, 1922, gave specific nomenclature to various Income Tax authorities for the first time. In 1924, the Central Board of Revenue Act constituted a Central Board of Revenue -- the statutory body with functional responsibilities for the administration of the Income-Tax Act. Commissioners of Income Tax were appointed for each province and Assistant Commissioners and Income Tax Officers were placed under their control. Officers from the ICS manned top posts and the lower echelons were filled through promotions from the ranks. The Income Tax Service was established in 1944, which subsequently came to be known as Indian Revenue Service (Income Tax).
The first batch of Income Tax Officers (Class-II) was directly recruited in the year 1944 through the 1943 examination conducted by the Federal Service Commission for IA&AS and Allied Services.
The recruitment of Income Tax Officers (Class-I) started in 1945 with the recruitment of 18 officers through the IA&AS and Allied Services Examination of 1944. The service was then known as Income Tax Officers (Class-I) Service.
After the Union Public Service Commission was constituted, the recruitment was done through the combined Civil Services Examination. In 1953, the Service was recognized as an independent Central Service and was named Indian Revenue Service (Income Tax).
In the initial years, the officers were recruited in four different ways: -
- Officers directly recruited as I.T.O.Class-II) through the 1943 examination who got promoted to Class-I and were given weightage depending upon the evaluation by their Commissioners
- Officers directly recruited to Class-I through the 1944 examination
- Officers directly recruited as I.T.O.Class-II) through the 1943 examination and later selected to Class-I. Weightage was given to them also and their seniority vis-a-vis direct recruits was adjusted
- Officers promoted to Class-I grade from the lower ranks
In 1957, some Income Tax Officers (Class-I) were also recruited on an ad-hoc basis by a competitive examination from amongst officers of armed forces and the Income Tax Officers, (Class-II).
With the passage of time, only two sources of entry to Indian Revenue Service remained- officers directly recruited through Civil Services Examination conducted by UPSC and officers promoted from Income Tax Officers (Class-II) grade.
Induction training at the Academy is now imparted only to the directly recruited IRS officers. Other officers, including the ITOs, attend in-service courses at the Regional Training Institutes.