CBDT Member Akhilesh Ranjan, who was overlooked for the post of the Board's chairman, has written to the government seeking voluntary retirement, official sources said on Friday.
They said that Ranjan, who headed the tax force on direct taxes, has sought retirement from the service owing to "family and personal reasons."
However, officials privy to the development said the IRS officer would have continued in service had he been elevated to the post of Central Board of Direct Taxes (CBDT) Chairman.
The government on Thursday gave a one-year extension to CBDT Chairman P C Mody, who was set to retire on August 31.
Ranjan, a 1982-batch Indian Revenue Service officer, was second in the succession line and is stipulated to retire in April next year.
On August 19, the officer, along with other experts and members, submitted a report to Finance Minister Nirmala Sitharaman on revising direct taxes.