Sl. No.

Income not to be included in total income

Eligible pers

S.82 Profit on sale of property used for residence

(1) Where an individual or Hindu undivided family--

(a) has long-term capital gains arising from the transfer of a capital asset, being buildings or lands appurtenant thereto, and being a residential house, the income of which is chargeable under the head "Income from house property" (original asset); and (b) has within one year before or two years after the date of such transfer purchased, or has within three years after that date constructed, one residential house in India (new asset), then, instead of the capital gain being charged to income-tax as income of the tax year in which the transfer took place, it shall be dealt with as follows:--

(i) if the capital gains exceeds the cost of the new asset, such excess shall be charged under section 67, and for computing capital gains arising from the transfer of the new asset within three years of its purchase or construction, the cost shall be nil; or

(ii) if the capital gains is equal to or less than the cost of

S.84 Capital gains on compulsory acquisition of lands and buildings not to be charged in certain cases

(1) Where an assessee has--

(a) capital gains arising from the transfer by way of compulsory acquisition under any law, of a capital asset being land or building or any right in land or building, forming part of an industrial undertaking belonging to him, which was being used by the assessee for the business of the said undertaking in the two years immediately preceding the date of transfer (original asset); and (b) within three years after that date, purchased any other land or building or any right in any other land or building or constructed any other building for shifting or re-establishing the said undertaking or setting up another industrial undertaking (new asset), then, instead of the capital gain being charged to income-tax as income of the tax year in which the transfer took place, it shall be dealt with as follows:--

(i) if the capital gains exceeds the cost of new asset, such excess shall be charged under section 67, and for computing any capital gains ari

S.83 Capital gains on transfer of land used for agricultural purposes not to be charged in certain cases

(1) Where an assessee, being an individual or a Hindu undivided family,--

(a) has capital gains arising from the transfer of a capital asset, being land, which was used by the assessee or his parent, or the Hindu undivided family for agricultural purposes (original asset), in two years immediately preceding the date of transfer; and (b) has, within two years after that date, purchased any other land for being used for agricultural purposes (new asset), then, instead of the capital gains being charged to income-tax as income of the tax year in which the transfer took place, it shall be dealt with as follows:--

(i) if the capital gains exceed the cost of the new asset, such excess shall be charged under section 67, and for computing any capital gains arising from the transfer of the new asset within three years of its purchase, the cost shall be nil; or

(ii) if the capital gains is equal to or less than the cost of the new asset, no capital gains shall be charged

S.81 Advance money received 

Where any capital asset was, on any previous occasion, the subject of negotiations for its transfer, any advance or other money received and retained by the assessee in respect of such negotiations--

(a) shall be deducted from the cost for which the asset was acquired or the written down value or the fair market value, as the case may be, in computing the cost of acquisition;

(b) shall not be deducted from the said cost, where such advance or other money has been included in the total income of the assessee for any tax year as per the provisions of section 92(2)(h) of this Act or section 56(2)(ix) of the Income-tax Act, 1961 (43 of 1961).

S.75 Special provision for cost of acquisition in case of depreciable asset 

If depreciation has been obtained under section 33(2) for a capital asset in any tax year, the provisions of sections 72 and 73 shall apply subject to the modification that the written down value, as defined in section 41, of the asset, as adjusted, shall be taken as the cost of acquisition of the asset.

S.58 Special provision for computing profits and gains of business or profession on presumptive basis in case of certain residents

(1) The provisions of sections 26 to 54, to the extent contrary to this section, shall not apply to the manner of computation of profits and gains of the specified business or profession in sub-section (2).

(2) The profits and gains of any specified business or profession as mentioned in column B of the Table below, carried on by an assessee specified in column C of the said Table, having total turnover or gross receipts of business or profession during the tax year specified in column D and computed in the manner specified in column E thereof, shall be deemed to be the profits and gains of such business or profession chargeable to tax under the head "Profits and gains of business or profession".

Table Sl. No. Specified business or profession Assessee Total turnover or, as the case may be, gross receipts of business or profession during tax year Manner of computation A B C D E

1. Any business other than the business specified against serial number 2.

El

S.61 Special provision for computation of income on presumptive basis in respect of certain business activities of certain nonresidents

 (1) The provisions of sections 26 to 54, to the extent contrary to this section, shall not apply to the manner of computation of profits and gains of the specified business in sub-section (2).

(2) The profits and gains of any specified business as mentioned in column B of the Table below, carried on by a specified assessee as mentioned in column C of the said Table during a tax year, shall be computed in the manner specified in column D thereof, and shall be deemed to be the profits and gains of such business of such assessee chargeable to tax for the said tax year under the head "Profits and gains of business or profession".

Table Sl No. Specified business Specified assessee Profits and gains of business or profession A B C D

1. Business of operation of ships, other than cruise ships referred to in Serial number 2.

Nonresident.

7.5% of (A+B), where,--

A = sum on account of carriage of passengers, livestock, mail or goods shipped at any p

S.60 Deduction of head office expenditure in case of nonresidents

(1) Irrespective of anything to the contrary contained in sections 26 to 54, in the case of a non-resident assessee, deduction of head office expenditure incurred by such assessee as is attributable to his business or profession in India, shall be allowed in computing the income chargeable under the head "Profits and gains of business or profession" subject to provisions of sub-section (2).

(2) The deduction allowable under sub-section (1) shall be restricted--

(a) if the adjusted total income of the assessee is a loss, to an upper monetary limit of 5% of the average adjusted total income of the assessee; or

(b) in any other case, to an upper monetary limit of 5% of the adjusted total income of the assessee.

(3) For the purposes of this section,--

(a) "adjusted total income" means the total income computed under this Act, without giving effect to the allowance referred to in this section or in section 33(11) or the deduction referred to in section

S.62 Maintenance of books of account 

(1) (a) Any person carrying on specified profession; or

(b) any person carrying on, business; or any profession [not being a profession referred to in clause (a)] and satisfying the conditions referred to in sub-section (2), shall keep and maintain such books of account and other documents to enable the Assessing Officer to compute his total income under this Act.

(2) The conditions in respect of persons referred to in sub-section (1)(b) shall be the following:--

(a) where the income from business or profession exceeds ₹ 120000 or its total sales, turnover or gross receipts from such business or profession exceeds ten lakh rupees in any one of the three years immediately preceding the tax year; or

(b) where business or profession is newly set up in the tax year, the income from business or profession is likely to exceed ₹ 120000 or its total sales, turnover or gross receipts from such business or profession is likely to exceed ten lakh rupees during such

S.52 Amortisation of expenditure for telecommunications services, amalgamation, demerger, scheme of voluntary retirement, etc

(1) Where an expenditure of the nature specified in column B of the Table given below is incurred during the tax year, a deduction or part thereof shall be allowed in equal instalments in each of the successive tax years as mentioned in column D of the said Table, beginning from the initial tax year specified in column C thereof.

Table Sl. No. Nature of expenditure Initial tax year Number of tax years over which deduction of expenditure is allowable in equal instalments A B C D

1. Expenditure incurred by an Indian company, wholly and exclusively for the purposes of amalgamation or demerger of an undertaking.

Tax year in which such amalgamation or demerger takes place.

Five tax years.

2. Amount paid to an employee in connection with his voluntary retirement as per any scheme of voluntary retirement.

Tax year in which such payment is made.

Five tax years.

3. Capital expenditure incurred and actually paid for acquiring any rig

S.51 Amortisation of expenditure for prospecting certain minerals

(1) An assessee, being an Indian company or a person (other than a company) who is resident in India, who is engaged in any operations relating to prospecting for, or extraction or production of, any mineral, shall be allowed a deduction of an amount equal to one-tenth of the amount of expenditure referred to in sub-section (2), in each of the relevant tax years.

(2) The expenditure referred to in sub-section (1) is the expenditure incurred by the assessee at any time during the year of commercial production and any one or more of the four tax years immediately preceding that year, wholly and exclusively on any operations relating to prospecting for any mineral or group of associated minerals specified in Part A or Part B, respectively, of the Schedule XII or on the development of a mine or other natural deposit of any such mineral or group of associated minerals.

(3) The expenditure under sub-section (2) shall be reduced by such expenditure which is met directly or i

S.54 Business of prospecting for mineral oils 

(1) Where the assessee undertakes specified oil exploration business, then deduction specified in sub-sections (3) and (4) shall be allowed while computing the income under the head "Profits and gains of business or profession".

(2) For the purposes of this section, "specified oil exploration business" means business consisting of prospecting for or extraction or production of mineral oils where the following conditions are fulfilled:--

(a) the Central Government has entered into an agreement with the assessee;

(b) such agreement is entered for association or participation of the Central Government or any person authorised by it; and (c) such agreement is laid before each House of Parliament.

(3) The deduction referred to in sub-section (1) shall be--

(a) for the period before the beginning of commercial production, expenditure towards infructuous or abortive exploration incurred in respect of any surrendered area;

(b) for the period after

S.59 Computation of royalty and fee for technical services in hands of nonresidents

(1) Income in the nature of royalty or fees for technical services received by a specified assessee during a tax year, shall be computed under the head "Profits and gains of business or profession" under this Act, if the following conditions are satisfied:--

(a) income is received from the Government or an Indian concern;

(b) income is in pursuance to an agreement made by the specified assessee with the Government or the Indian concern;

(c) the specified assessee carries on business in India through a permanent establishment, or performs professional services from a fixed place of profession, situated in India ; and (d) the right, property or contract in respect of which the royalties or fees for technical services are paid is effectively connected with such permanent establishment or fixed place of profession.

(2) No deduction shall be allowed against the income computed under sub-section (1) in respect of the following amounts:--

(a) any expendi

S.50 Special provision in case of trade, profession or similar association 

(1) Irrespective of anything to the contrary contained in this Act, if, during the tax year, the amount received by a specified association from its members falls short of the expenditure incurred by such association solely for the protection or advancement of common interest of its members, then the amount so falling short shall be allowed as deduction from the income of such association under the head "Profits and gains of business or profession" and the remaining amount, if any, shall be allowed deduction from its income under any other head.

(2) For the purposes of sub-section (1),--

(a) "specified association" means any trade, professional or similar association, not covered in Schedule III (Table: Sl. No. 24), whose income or its part is not distributed to its members (other than as grants to any associations or institutions affiliated to it);

(b) the amount received by the specified association from its members shall include amount by way of subscription

S.53 Full value of consideration for transfer of assets other than capital assets in certain cases

(1) In case of transfer of an asset (other than a capital asset), being land or building or both, if the consideration received or accrued from such transfer is less than the stamp duty value, then such stamp duty value for computing profits and gains from transfer of such asset shall be deemed to be the full value of consideration.

(2) The provisions of sub-section (1) shall not apply if the stamp duty value does not exceed 110% of the consideration received or accrued and in such a case, the consideration received or accrued shall be deemed to be the full value of consideration.

(3) If the date of agreement fixing the value of consideration for transfer of asset and date of registration for transfer of such asset are different, then the stamp duty value as on date of agreement may be taken to be the full value of consideration under sub-section (1).

(4) The provisions of sub-section (3) shall apply only in a case where the amount of consideration or a part th

S.56 Special provision in case of interest income of specified financial institutions

(1) Irrespective of anything to the contrary contained in this Act, the interest income in relation to bad or doubtful debts of a specified financial institution shall be chargeable to tax under the head "Profits and gains of business or profession" in the tax year in which such interest is--

(a) credited to the profit and loss account; or

(b) actually received, whichever is earlier.

(2) For the purposes of this section,--

(a) "specified financial institution" means--

(i) a public financial institution; or

(ii) a scheduled bank; or

(iii) a co-operative bank, other than--

(A) a primary agricultural credit society; or

(B) a primary co-operative agricultural and rural development bank; or

(iv) a State Financial Corporation; or

(v) a State Industrial Investment Corporation; or

(vi) any such class of non-banking financial companies, as may be notified by the Central Government;

(b) "bad or doubtfu

S.57 Revenue recognition for construction and service contracts 

(1) The profits and gains arising from a construction contract or a contract for providing services, shall be determined on the basis of percentage of completion method, subject to provisions of sub-section (2), as per the income computation and disclosure standards notified under section 276(2).

(2) For the purposes of sub-section (1), the profits and gains arising from a contract for providing services shall be determined--

(a) on the basis of project completion method, if the duration of such contract is not more than ninety days;

(b) on the basis of straight line method, if the contract involves indeterminate number of acts over a specified period of time.

(3) For the purposes of percentage of completion method, project completion method or straight line method under this section,--

(a) the contract revenue shall include retention money;

(b) the contract costs shall not be reduced by any incidental income in the nature of interest, divi

S.49 Site Restoration Fund 

(1) An assessee carrying on a business of prospecting, extracting, or producing petroleum or natural gas, or both, in India, and who has an agreement with the Central Government for this business, shall be allowed a deduction on the basis of deposit to special account or site restoration account and computed as per the provisions of the Schedule X.

(2) Any amount withdrawn or transferred from the aforesaid accounts at the time of closure or otherwise shall be charged to tax in the year in which the amount is transferred or withdrawn as per the provisions of the Schedule X.

(3) Where any asset acquired as per the special scheme, or the deposit scheme, as referred to in Schedule X, is sold or otherwise transferred in any tax year, it shall be charged to tax in accordance with the provisions of the said Schedule.

S.55 Insurance business

Irrespective of anything to the contrary contained in the provisions of this Act for computing income under the head "Income from house property", "Capital gains" or "Income from other sources", or in section 390(5) and (6), or in sections 26 to 54, the profits and gains of any business of insurance, including any such business carried on by a mutual insurance company or by a co-operative society, shall be computed as per the provisions of Schedule XIV.

S.88 Exemption of capital gains on transfer of assets in cases of shifting of industrial undertaking from urban area to any Special Economic Zone 

(1) Irrespective of anything contained in section 87, if the assessee has--

(a) capital gains arising from the transfer of a capital asset, being machinery or plant or building or land or any rights in building or land used for the business of an industrial undertaking situated in an urban area, effected in the course of or in consequence of shifting of such industrial undertaking (original asset) to any Special Economic Zone in any urban or any other area; and (b) has within one year before or three years after the date of such transfer,--

(i) purchased machinery or plant for the business of the industrial undertaking in such Special Economic Zone;

(ii) acquired building or land or constructed building for his business in such Special Economic Zone;

(iii) shifted the original asset and transferred the establishment of such undertaking to such Special Economic Zone; and (iv) incurred expenses on such other purposes specified by a scheme notified by the C

S.111 Carry forward and set off of loss from Capital gains

(1) (a) Where for any tax year, loss computed under the head "Capital gains" cannot be wholly set off against the income under the head "Capital gains" as per section 108, so much of the loss not so set off or the whole loss, as the case may be, shall be carried forward to the following tax year and shall be set off in the following manner--

(i) if such loss relates to a short-term capital asset, it shall be set off only against the income under the head "Capital gains", if any, assessable for that tax year in respect of any other capital asset;

(ii) if such loss relates to a long-term capital asset, it shall be set off only against the income under the head "Capital gains", if any, assessable for that tax year in respect of any other long-term capital asset; and (b) if the loss cannot be wholly so set off under clause (a), the amount of loss not so set off shall be carried forward to the following tax year and so on.

(2) No loss shall be carried forward under

S.112 Carry forward and set off of business loss

(1) Where for any tax year, loss computed under the head "Profits and gains of business or profession" (not being a loss sustained in a speculation business) cannot be wholly set off against the income under any other head as per section 109, so much of the loss not so set off or the whole loss, as the case may be, shall be carried forward to the following tax year and--

(i) be set off against the profits and gains, if any, of any business or profession carried on by him for that tax year; and (ii) if the loss cannot be wholly so set off, the amount of loss not so set off shall be carried forward to the following tax year and so on.

(2) No loss shall be carried forward under this section for more than eight tax years immediately succeeding the tax year for which the loss was first computed.

(3) Where any allowance of part thereof under section 33(11) or 45(7) is to be carried forward, effect shall first be given to the provision of this section.

S.106 Amount borrowed or repaid through negotiable instrument, hundi, etc

(1) Where any amount (including interest thereof) is borrowed or repaid through a negotiable instrument or on a hundi, otherwise than an account payee cheque, or through any mode as specified by the Board in this behalf, the amount so borrowed or repaid (including interest paid on the borrowed amount) shall be deemed to be the income of the person borrowing or repaying, as the case may be, for the tax year in which the amount was borrowed or repaid.

(2) Where the amount borrowed under sub-section (1) has been deemed to be the income of any person, such person shall not be liable to be assessed again in respect of such amount under that sub-section on repayment of such amount.

S.104 Unexplained asset

(1) Where in any tax year, any asset has been found to be owned by or belonging to the assessee which is not recorded in the books of account, if any, maintained by such assessee for any source of income, or the Assessing Officer finds that the amount expended in acquiring such asset exceeds the amount recorded in such books of account and--

(a) the assessee offers no explanation about the nature and source of acquisition of such asset, or such excess amount, as the case may be; or

(b) the explanation offered about the nature and source of acquisition of such asset by the assessee, is not satisfactory in the opinion of the Assessing Officer, then, the value of such asset, or such excess amount, as the case may be, shall be deemed to be the income of the assessee of the tax year in which such asset has been found to be owned by, or belonging to, the assessee.

(2) For the purposes of this section, "asset" includes money, bullion, jewellery, virtual digital asset

S.110 Carry forward and set off of loss from house property

(1) Where for any tax year, loss computed under the head "Income from house property" cannot be wholly set off against the income under any other head as per section 109, so much of the loss not so set off or the whole loss, as the case may be, shall be carried forward to the following tax year and--

(a) be set off only against the income from house property, if any, assessable for that tax year; and (b) if the loss cannot be wholly so set off, the amount of loss not so set off shall be carried forward to the following tax year and so on.

(2) No loss shall be carried forward under this section for more than eight tax years immediately succeeding the tax year for which the loss was first computed.

S.109 Set off of losses under any other head of income

(1) Subject to the provisions of this Chapter, for any tax year, if income computed under any head of income (other than "Capital gains") is a loss, such loss shall be set off against income of the assessee under any other head, including "Capital gains", if any, assessable for that tax year, subject to the following conditions:--

(a) loss under the head "Profits and gains of business or profession" shall not be set off against income assessable under the head "Salaries"; and (b) loss under the head "Income from house property" shall be set off to the extent of ₹ 200000 against income under any other head;

(2) For any tax year, the loss under the head "Capital gains" shall not be set off against income under any other head.

S.108 Set off of losses under same head of income

(1) Unless provided otherwise in this Act, for any tax year, if net result of computation from any source under any head of income (other than "Capital gains") is a loss, then assessee shall be entitled to set off such loss against his income from any other source under the same head for that tax year.

(2) Where the net result of computation of income made for any tax year under sections 72 to 90 in respect of--

(a) any short-term capital asset is a loss, such loss shall be set off against the income, computed in respect of any other capital asset for that year;

(b) any long-term capital asset is a loss, such loss shall be set off against the income computed in respect of any other long-term capital asset for that year.

S.103 Unexplained investment

Where in any tax year, any investment has been made by the assessee which is not recorded in the books of account, if any, maintained by such assessee for any source of income, or, the Assessing Officer finds that the amount of such investment exceeds the amount recorded in such books of account and--

(a) the assessee offers no explanation about the nature and source of such investment, or such excess amount, as the case may be; or

(b) the explanation offered about the nature and source of such investment by the assessee, is not satisfactory in the opinion of the Assessing Officer, then, the value of such investment, or such excess amount, as the case may be, shall be deemed to be the income of the assessee of that tax year.

S.105 Unexplained expenditure

(1) Where any expenditure has been incurred by the assessee in any tax year, and--

(a) the assessee offers no explanation about the source of such expenditure or part thereof; or

(b) the explanation offered about the source of such expenditure by the assessee is not satisfactory in the opinion of the Assessing Officer, then, the amount covered by such expenditure or part thereof, shall be deemed to be the income of the assessee for that tax year.

(2) Irrespective of any other provision of this Act, the amount deemed as income in sub-section (1) shall not be allowed as a deduction under this Act.

S.107 Charge of tax

Income referred to in sections 102, 103, 104, 105 and 106 shall be charged to tax as per the provisions of section 195.

S.44 Amortisation of certain preliminary expenses

(1) If an assessee, being an Indian company or a person (other than a company), who is resident in India , incurs any expenditure specified in sub-section (2)--

(a) before the commencement of its business; or

(b) after the commencement of its business, in connection with the extension of its undertaking or in connection with its setting up a new unit, the assessee shall be allowed a deduction of an amount equal to one-fifth of such expenditure for each of the five successive tax years beginning with--

(i) the tax year in which the business commences, for clause (a); or

(ii) the tax year in which the extension of the undertaking is completed or the new unit commences production or operation, for clause (b).

(2) The expenditure referred to in sub-section (1) shall be--

(a) the expenditure in connection with--

(i) preparation of feasibility report;

(ii) preparation of project report;

(iii) conducting market survey or any o

S.43 Taxation of foreign exchange fluctuation 

(1) Subject to the provisions of section 42, any gain or loss arising on account of change in foreign exchange rates on foreign currency transactions shall be treated as income or loss, as the case may be, and shall be computed as per the income computation and disclosure standards notified under section 276(2).

(2) The provisions of sub-section (1) shall be applicable to all foreign currency transactions, including those relating to--

(a) monetary items and non-monetary items;

(b) translation of financial statements of foreign operations;

(c) forward exchange contracts; and (d) foreign currency translation reserves.

S.19 Deductions from salaries

(1) The income chargeable under the head "Salaries" shall be computed after making the deductions in respect of sums of the nature mentioned in column B of the following Table, not exceeding the amount as mentioned in column C thereof:--

Table Sl. No. Nature of sum Amount of deduction A B C

1. Sum paid by the assessee as a tax on employment as per article 276(2) of the Constitution, leviable by or under any law.

Entire amount.

2. Standard deduction.

(a) ₹ 75000 or the salary, whichever is less, where income-tax is computed under section 202(1);

(b) ₹ 50000 or the salary, whichever is less, in any other case.

3. Death-cum-retirement gratuity received as referred to in sub-section (2)(g).

Entire amount.

4. Payment of retiring gratuity received under the Pension Code or Regulations applicable to the members of the defence services.

Entire amount.

5. Gratuity received under the Payment of Gratuity Act, 1972 (3

S.17 Perquisite

(1) For the purposes of this Part, "perquisite" includes--

(a) the value of rent-free accommodation provided to the assessee by his employer computed in such manner as may be prescribed;

(b) the value of any accommodation, computed in such manner as may be prescribed, provided to the assessee by his employer at a concessional rate which is in excess of rent recoverable from or payable by the assessee;

(c) the value of any benefit or amenity granted or provided free of cost or at concessional rate in the following cases:--

(i) by a company to an employee, who is a director thereof or who has a substantial interest in the company;

(ii) by any employer (including a company) to an employee [other than employee referred in sub-clause (i)] whose income under the head "Salaries" by way of monetary payment (from one or more employers) exceeds such amount as may be prescribed;

(d) the value of any specified security or sweat equity shares allotted o

S.21 Determination of annual value

(1) For the purposes of section 20, the annual value of any property shall be deemed to be the higher of the following:--

(a) the sum for which it might reasonably be expected to let from year to year; or

(b) the actual rent received or receivable by the owner, if the property or any part of it is let.

(2) If the property or any part of it is let and was vacant for the whole or any part of the tax year and owing to such vacancy the actual rent received or receivable by the owner in respect thereof is less than the sum referred to in sub-section (1)(a), the annual value of such property shall be deemed to be the amount so received or receivable.

(3) The annual value of the property shall be reduced by the taxes (including service taxes) levied by a local authority in respect of such property, actually paid during the tax year by the owner, irrespective of when such taxes became payable.

(4) The rent which cannot be realised by the owner shall not b

S.20 Income from house property

(1) The annual value of property consisting of any buildings or lands appurtenant thereto, owned by the assessee shall be chargeable to income-tax under the head "Income from house property".

(2) The provisions of sub-section (1) shall not apply to such portions of the property, as the assessee may occupy for his business or profession, the profits of which are chargeable to income-tax.

S.35 Amounts not deductible in certain circumstances

Irrespective of any other provision of Chapter IV-D, the following amounts shall not be allowed as deduction in computing the income chargeable under the head "Profits and gains of business or profession":--

(a) any amount on account of--

(i) tax paid on income; or

(ii) tax paid by employer referred to in Schedule III (Table: Sl. No. 10); or

(iii) tax paid in any other country for which relief is eligible under section 159 or 160, and shall include any surcharge or cess on such tax, by whatever name called;

(b) (i) 30% of any sum payable to a resident, on which tax is deductible at source under Chapter XIX-B and during the tax year, such tax has not been deducted or, after deduction, has not been paid up to the due date specified in section 263(1), so, however, that--

(A) where in respect of any such sum, tax is deducted in any subsequent year, or is deducted during the tax year but paid after the due date specified in section 263(1), 30% o

S.39 Computation of actual cost

(1) The actual cost of an asset used for the purposes of the business or profession shall be the actual cost to the assessee, as reduced by the following amounts:--

(a) part of cost of asset, if any, met by any other person or authority, directly or indirectly;

(b) goods and services tax paid in respect of which credit of input tax has been claimed and allowed under the relevant law;

(c) duty of excise or additional duty leviable under section 3 of the Customs Tariff Act, 1975 (51 of 1975) in respect of which a claim of credit has been made and allowed under the Central Excise Rules, 1944;

(d) subsidy, grant or reimbursement, by whatever name called, if any, relatable to the acquisition of the asset, received, directly or indirectly, by the assessee from--

(i) the Central Government;

(ii) a State Government;

(iii) any authority established under any law; or

(iv) any other person.

(2) The payment or aggregate of payments

S.41 Written down value of depreciable asset

(1) For the purposes of computation of income under the head "Profits and gains of business or profession", written down value means--

(a) in case the asset is acquired in the tax year, the actual cost to the assessee;

(b) in case the asset is acquired before the tax year, actual cost to the assessee less depreciation actually allowed under this Act or under the Income-tax Act, 1961 (43 of 1961);

(c) in case of block of assets, the written down value computed in the following manner:

[(A-D) + B-C]-E, where A = the written down value of the block of assets in the immediately preceding tax year;

B = actual cost of any asset falling within that block, acquired during the tax year;

C = moneys payable together with scrap value, if any, in respect of any asset falling within the block, which is sold, transferred, demolished, destroyed or discarded during the tax year, where "C" shall not exceed (A-D)+B;

D = depreciation actually allowed in

S.42 Capitalisig impact of foreign exchange fluctuation

(1) Irrespective of anything contained in any other provision of this Act, where at the time of making payment during the tax year, there is a variation in liability of an assessee as expressed in Indian currency, due to change in rate of exchange, in relation to an asset acquired for the purpose of business or profession from a country outside India, it shall be dealt with in the manner specified in sub-sections (2) and (3).

(2) For this section, the liability shall exclude any part met directly or indirectly by any other person or authority and the "variation in liability" shall be computed as--

A = B-C where,--

A = variation in liability;

B = payment expressed in Indian currency at the time when it is made--

(a) towards the whole or part of the cost of asset; or

(b) towards repayment of the whole or part of the moneys borrowed, directly or indirectly, along with interest in foreign currency, specifically for acquiring such asset;

S.26 Income under head "Profits and gains of business or profession" 

(1) The incomes referred to in sub-section (2) shall be chargeable to income-tax under the head "Profits and gains of business or profession".

(2) The income under sub-section (1) shall include--

(a) the profits and gains of any business or profession carried on by the assessee at any time during the tax year;

(b) any compensation or other payment, due to, or received, by any person by whatever name called,--

(i) wholly or substantially managing the affairs--

(A) of an Indian company; or

(B) in India , of any other company; or

(ii) holding any agency in India for any part of business activities of any other person; or

(iii) for any contract relating to business, in connection with termination of management, office, agency or contract, as the case may be, or modification of terms and conditions relating thereto;

(c) any compensation or payment, due to, or received by, any person for vesting of the management of any prope

S.22 Deductions from income from house property

(1) The income under the head "Income from house property" shall be computed after making the following deductions:--

(a) 30% of the annual value as determined under section 21;

(b) where the property has been acquired, constructed, repaired, renewed or reconstructed with borrowed capital, the amount of any interest payable on such capital;

(c) where the capital referred to in clause (b) is borrowed during any period prior to the tax year in which the property has been acquired or constructed, the amount of any interest payable for the said prior period in five equal instalments for the said tax year and for each of the four immediately succeeding tax years.

(2) In case of property or properties referred to in section 21(6), the aggregate amount of deduction under 1[sub-section (1)(b) and (c)] shall not exceed--

(a) ₹ 200000, subject to the following conditions:--

(i) the property has been acquired or constructed with borrowed capital and s

S.25 Interpretation

For the purposes of sections 20 to 24, the "owner" in relation to a property or any part thereof shall include--

(a) an individual who transfers without adequate consideration, any property to the spouse (except under an agreement to live apart), or to a minor child (other than a married daughter);

(b) the holder of an impartible estate, and he shall be deemed to be an individual owner in respect of all the properties comprised in the estate;

(c) a member of a co-operative society, company or other association of persons to whom a building or part thereof is allotted or leased under a house building scheme of the society, company or association;

(d) a person who is allowed to take or retain possession of any building or part thereof in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882 (4 of 1882);

(e) a person who acquires any rights (excluding any rights by way of a lease from month to m

S.28 Rent, rates, taxes, repairs and insurance 

(1) The following amounts shall be allowed as deduction in respect of premises, machinery, plant or furniture used for the purposes of the business or profession:--

(a) any premium paid in respect of insurance against risk of damage or destruction thereof;

(b) land revenue, local rates or municipal taxes paid;

(c) rent paid, when the premises are occupied by the assessee as a tenant;

(d) amount paid on account of current repairs to the premises, not being in the nature of capital expenditure, when the premises are occupied by the assessee otherwise than as a tenant;

(e) amount paid on account of cost of repairs, not being in the nature of capital expenditure, when the premises are occupied by the assessee as a tenant and where he has undertaken to bear the cost of repairs to the premises; and (f) the amount paid on account of current repairs to machinery, plant or furniture, not being in the nature of capital expenditure.

(2) In case where

S.23 Arrears of rent and unrealised rent received subsequently

(1) The amount of arrears of rent received by an assessee from a tenant, or the unrealised rent realised subsequently from a tenant, shall be deemed to be the income from house property in respect of the tax year in which such rent is received or realised.

(2) The amount deemed to be income from house property under sub-section (1) shall be included in the total income of the assessee under the head "Income from house property", whether the assessee is the owner of the property or not in that tax year.

(3) A sum equal to 30% of the arrears of rent or the unrealised rent referred to in sub-section (1) shall be allowed as deduction.

S.24 Property owned by co-owners

(1) For property co-owned with definite and ascertainable share, the co-owners shall not be assessed as an association of persons and their income computed separately under this Part as per their respective share shall be included in their total income.

(2) The relief available under section 21(6) shall be provided as if each co-owner is individually entitled to the said relief.

S.27 Manner of computing profits and gains of business or profession 

The income referred to in section 26 shall be computed as per the provisions of sections 28 to 60, except section 58.

preliminary Act No. 30 of 2025

[Act No. 30 of 2025] 

[ 21st August, 2025 ]

PREAMBLE An Act to consolidate and amend the law relating to income-tax.

Be it enacted by Parliament in the Seventy-sixth Year of the Republic of India as follows:-

S.6 Residence in India

(1) For the purposes of this Act, residential status in India in a tax year of a person shall be determined as per the provisions of this section.

(2) An individual shall be resident in India in a tax year, if he--

(a) is in India for a total period of one hundred and eighty-two days or more in that tax year; or

(b) is in India cumulatively for sixty days or more during that year and has been in India cumulatively for three hundred and sixty-five days or more in the four years preceding such tax year.

(3) The provisions of sub-section (2)(b) shall not apply in the case of an individual who is a citizen of India and leaves India in any tax year--

(a) as a member of the crew of an Indian ship, as defined in section 3(18) of the Merchant Shipping Act, 1958 (44 of 1958); or

(b) for the purposes of employment outside India .

(4) The provisions of sub-section (2)(b) shall not apply, subject to the provisions of sub-section (5), in the case

S.5 Scope of total income

(1) Subject to the provisions of this Act, the total income of any tax year of a person, who is a resident, includes all income from whatever source derived, which--

(a) is received or deemed to be received in India in that year by or on behalf of such person;

(b) accrues or arises, or is deemed to accrue or arise, to such person in India in that year; or

(c) accrues or arises to such person outside India in that year, but when such person is "not ordinarily resident" in India under section 6(13), such income shall be included only when it is derived from a business controlled in or a profession set up in India .

(2) Subject to the provisions of this Act, the total income of a tax year of a person, who is a non-resident, includes all income from whatever source derived, which--

(a) is received or deemed to be received in India in that year by or on behalf of such person; or

(b) accrues or arises, or is deemed to accrue or arise, to such per

S.4 Charge of income-tax 

(1) Where any Central Act enacts that income-tax shall be charged for any tax year at any rate or rates, income-tax for such tax year shall be charged at that rate or those rates in accordance with and subject to the provisions of this Act.

(2) The charge of income-tax under sub-section (1) shall be on the total income of the tax year of every person as per the provisions of this Act.

(3) Income-tax shall also include any additional income-tax, by whatever name called, levied under this Act.

(4) If this Act provides that income-tax is to be charged in respect of income of a period other than the tax year, it shall be charged accordingly.

(5) For the income chargeable under this section, income-tax shall be deducted or collected at source or paid in advance as provided under this Act.

S.1 Short title, extent and commencement

(1) This Act may be called the Income-tax Act, 2025.

(2) It extends to the whole of India.

(3) Save as otherwise provided in this Act, it shall come into force on the 1st April, 2026.

S.9 Income deemed to accrue or arise in India

(1) The income referred to in sub-sections (2) to (8) shall be deemed to accrue or arise in India .

(2) The income accruing or arising, directly or indirectly, through or from--

(a) any asset or source of income in India ; or

(b) any property in India ; or

(c) any business connection in India ; or

(d) the transfer of a capital asset situated in India , shall be deemed to accrue or arise in India .

(3) Any income falling under the head "Salaries" shall be deemed to accrue or arise in India , if it is--

(a) earned in India , and any income payable for,--

(i) services rendered in India ; and (ii) the rest period or leave period which is preceded and succeeded by services rendered in India and forms part of the service contract of employment, shall be regarded as income earned in India ;

(b) payable by the Government to an Indian citizen for services rendered outside India .

(4) Any dividend paid by an Indian company

S.8 Income on receipt of capital asset or stock-in-trade by specified person from specified entity

(1) Where a specified person receives during the tax year any capital asset or stock-in-trade, or both, from a specified entity in connection with the dissolution or reconstitution of such specified entity, then the specified entity shall be deemed to have transferred such capital asset or stock-in-trade, or both, to the specified person in the year in which such capital asset or stock-in-trade, or both, are received by the specified person.

(2) Any profits and gains arising from the deemed transfer mentioned in sub-section (1) by the specified entity shall be--

(i) deemed to be the income of such specified entity of the tax year in which such capital asset or stock-in-trade, or both, were received by the specified person; and (ii) chargeable to income-tax as income of such specified entity under the head "Profits and gains of business or profession" or under the head "Capital gains".

(3) For the purposes of this section, fair market value of the capital asset

S.7 Income deemed to be received and dividend deemed to be income in a tax year

(1) The following incomes shall be deemed to be received in the tax year:--

(a) the annual accretion in that year to the balance at the credit of an employee participating in a recognised provident fund, to the extent provided in paragraph 6 of Part A of Schedule XI;

(b) the transferred balance in a recognised provident fund, to the extent provided in paragraph 11(4) and (5) of Part A of Schedule XI;

(c) the contribution made by the Central Government or any other employer in that year to the account of an employee under a pension scheme mentioned in section 124.

(2) For inclusion in the total income of an assessee,--

(a) any dividend declared by a company or distributed or paid by it within the meaning of section 2(40)(a) to 1[(e)] shall be deemed to be the income of the tax year in which it is so declared, distributed or paid, as the case may be;

(b) any interim dividend shall be deemed to be the income of the tax year in which the amount

S.10 Apportionment of income between spouses governed by Portuguese Civil Code 

If a husband and wife are governed by the community of property system (known as "COMMUNIAO DOS BENS" under the Portuguese Civil Code of 1860) in force in the State of Goa and the Union territories of Dadra and Nagar Haveli and Daman and Diu, then--

(a) their income under any head of income shall not be assessed together as that of such community of property (whether treated as an association of persons or a body of individuals);

(b) the income mentioned in clause (a) under each head of income other than "Salaries" shall be divided equally between the husband and the wife;

(c) the income so divided shall be included separately in the total income of the husband and the wife respectively, and the remaining provisions of this Act shall apply accordingly; and (d) where either the husband or the wife, has any income under the head "Salaries", that income shall be included in the total income of the spouse who has actually earned it.

S.14 Income not forming part of total income and expenditure in relation to such income

(1) Irrespective of anything to the contrary contained in this Act, for the purposes of computing the total income under this Chapter, no deduction shall be allowed in respect of expenditure incurred by the assessee in relation to income which does not form part of the total income.

(2) Where the Assessing Officer, having regard to the accounts of the assessee, is not satisfied with--

(a) the correctness of the claim of expenditure incurred by the assessee; or

(b) the claim made by the assessee that no expenditure has been incurred, in relation to income which does not form part of the total income under this Act, he shall determine such amount of expenditure in accordance with any method, as may be prescribed.

(3) Irrespective of anything to the contrary contained in this Act, the provisions of this section shall apply in a case where any expenditure has been incurred during any tax year in relation to income which does not form part of the total income

S.16 Income from salary 

For the purposes of this Part, "salary" includes--

(a) wages;

(b) any annuity or pension;

(c) any gratuity;

(d) any fees or commission;

(e) perquisites;

(f) profits in lieu of, or in addition to, any salary or wages;

(g) any advance of salary;

(h) any payment received by an employee in respect of any period of leave not availed of by him;

(i) the annual accretion to the balance at the credit of an employee participating in a recognised provident fund, to the extent to which it is chargeable to tax as per paragraph 6 of Part A of Schedule XI;

(j) the aggregate of all sums that are comprised in the transferred balance as referred to in paragraph 11(2) of Part A of Schedule XI of an employee participating in a recognised provident fund, to the extent to which it is chargeable to tax under sub-paragraphs (4) and (5) thereof;

(k) the contribution made by the Central Government or any other employer in any tax y

S.12 Incomes not included in total income of political parties and electoral trusts 

Section 12 - Incomes not included in total income of political parties and electoral trusts  (1) In computing the total income of any political party or an electoral trust for a tax year under this Act, any income enumerated in Schedule VIII shall not be included, subject to fulfilment of conditions specified therein.

(2) Wherever the conditions referred to in Schedule VIII are not satisfied in any tax year in respect of any income enumerated in the said Schedule, such income shall be charged to tax under this Act for that tax year.

(3) The Central Government may make rules or issue notifications for the purposes of this section as specified in Schedule VIII.

S.11 Incomes not included in total income

(1) In computing the total income of any person for a tax year under this Act, any income enumerated in Schedules II, III, IV V and VI shall not be included, subject to fulfilment of conditions specified therein.

(2) Wherever the conditions referred to in the Schedules referred in sub-section (1) are not satisfied in any tax year in respect of any income enumerated in the said Schedules, such income shall be charged to tax under this Act on the total income for that tax year.

(3) The persons enumerated in Schedule VII shall, subject to fulfilment of the conditions specified therein, not be chargeable to tax under this Act on the total income for a tax year.

(4) Wherever the conditions referred to in Schedule VII are not satisfied in respect of the persons enumerated in the said Schedule in any tax year, the income of such person shall be charged to tax under the provisions of this Act for that tax year.

(5) The Central Government may make rules or issue

S.15 Salaries

(1) The following income shall be chargeable to income-tax under the head "Salaries":--

(a) any salary due from an employer to an assessee in the tax year, whether paid or not;

(b) any salary paid or allowed to him in the tax year by or on behalf of an employer though not due or before it became due to him;

(c) any arrears of salary paid or allowed to him in the tax year by or on behalf of an employer, if not charged to income-tax for any earlier tax year.

(2) For the purposes of sub-section (1), employer includes former employer.

(3) If any salary paid in advance is included in the total income of any person for any tax year, it shall not be included again in the total income of such person when the salary becomes due.

(4) Any salary, bonus, commission or remuneration, by whatever name called, due to, or received by, a partner of a firm from the firm shall not be regarded as salary for the purposes of this section.

S.13 Heads of income

Save as otherwise provided in this Act, all incomes shall, for the purposes of charge of income-tax and computation of total income, be classified under the following heads of income:--

(a) Salaries;

(b) Income from house property;

(c) Profits and gains of business or profession;

(d) Capital gains; and (e) Income from other sources.

S.33 Deduction for depreciation

(1) A deduction in respect of depreciation of--

(a) buildings, machinery, plant or furniture, being tangible assets;

(b) know-how, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature, being intangible assets acquired on or after the 1st April, 1998, not being goodwill of a business or profession, owned wholly or partly by the assessee and used wholly and exclusively for the purposes of the business or profession, shall be allowed, as per the provisions of this section.

(2) In case of assets referred to in sub-section (1) of an undertaking engaged in generation or generation and distribution of power, the deduction in respect of depreciation shall be such percentage of its actual cost to the assessee, as may be prescribed.

(3) (a) In case of any block of assets, deduction in respect of depreciation shall be such percentage of its written down value, as may be prescribed;

(b) when any bu

S.32 Other deductions

The following amounts shall be allowed as deduction in computing income chargeable under section 26:--

(a) bonus or commission paid to an employee for services rendered, but only when such amount would not have been payable to the employee as profits or dividend if it had not been paid as bonus or commission;

(b) interest paid in respect of capital borrowed for the purposes of business or profession, where--

(i) such interest shall not include interest on capital borrowed for acquisition of an asset, whether capitalised in the books of account or not, for any period beginning from the date the capital was borrowed for acquisition of the asset till the date that asset was first put to use;

(ii) recurring subscriptions paid periodically by shareholders or subscribers in Mutual Benefit Societies fulfilling the conditions as may be prescribed, shall be deemed to be capital borrowed;

(c) contribution paid by a public financial institution to the credit

S.31 Deduction for bad debt and provision for bad and doubtful debt 

(1) The amount mentioned in column C of the Table below, in respect of any provision for bad and doubtful debts made by the assessee specified in column B thereof, shall be allowed as a deduction in computation of income chargeable under section 26.

Table Sl. No. Specified assessee Amount of deduction A B C

1. (a) A scheduled bank, other than a bank incorporated by or under the laws of a country outside India ; or

(b) a non-scheduled bank; or

(c) a co-operative bank, other than--

(i) a primary agricultural credit society; or

(ii) a primary co-operative agricultural and rural development bank.

(a) not more than 8.5% of the total income of the tax year computed before making any deduction under this clause and Chapter VIII, and an additional amount up to 10% of the aggregate average advances made by rural branches computed in the manner as may be prescribed;

(b) for an assessee mentioned in clauses (a) and (b) of column B, at i

S.29 Deductions related to employee welfare 

(1) The following sums, in the case of an assessee being an employer, shall be allowed as deduction in computing income chargeable under section 26:--

(a) any sum paid by way of contribution towards a recognised provident fund or an approved superannuation fund, subject to--

(i) such limits, as may be prescribed, for recognising the provident fund or approving the superannuation fund; and (ii) such conditions, as the Board may specify, for cases where the contributions are not made annually either as fixed amounts, or annual contributions fixed on some definite basis by reference to the income chargeable under the head "Salaries" or the contributions or to the number of members of the fund;

(b) any sum paid by way of contribution towards a pension scheme referred to in section 124, for an employee up to 14% of the salary of the employee in the tax year, where such salary includes dearness allowance, if the terms of employment so provide, but excludes all other

S.30 Deduction on certain premium

The following sums shall be allowed as deduction in computing income chargeable under section 26, being premium paid:--

(a) by any assessee in respect of insurance against risk of damage or destruction of stocks or stores used for the purposes of business or profession;

(b) by a federal milk co-operative society to effect or to keep in force an insurance on the life of the cattle owned by a member of a co-operative society, being a primary society engaged in supplying milk raised by its members to such federal milk co-operative society;

(c) by the assessee as an employer, through any mode of payment other than cash, to effect or to keep in force an insurance on the health of its employees under a scheme framed in this behalf by--

(i) the General Insurance Corporation of India formed under section 9 of the General Insurance Business (Nationalisation) Act, 1972 (57 of 1972) and approved by the Central Government; or

(ii) any other insurer and approv

S.36 Expenses or payments not deductible in certain circumstances

(1) The provisions of this section shall have effect irrespective of anything to the contrary contained in any other provision of this Act relating to computation of income under the head "Profits and gains of business or profession".

(2) If the assessee incurs any expenditure for which payment has been or is to be made to any "specified person", which in the opinion of the Assessing Officer is excessive or unreasonable having regard to the--

(a) fair market value of the goods, services or facilities; or

(b) legitimate needs of the business or profession of the assessee; or

(c) benefit derived by or accruing to the assessee therefrom, so much of the expenditure as considered excessive or unreasonable by him shall not be allowed as a deduction.

(3) For the purposes of sub-section (2) and this sub-section,--

(a) "specified person" shall mean the following,--

(i) in relation to an assessee mentioned in column B of the Table below, t

S.38 Certain sums deemed as profits and gains of business or profession

(1) The following sums shall be deemed to be profits and gains of business or profession and shall be chargeable to income-tax, in the manner specified below, subject to the provisions of sub-section (2):--

(a) where an allowance or deduction has been allowed in respect of any loss, expenditure or trading liability incurred by the assessee during any tax year, then,--

(i) the value of any benefit accruing to the assessee by way of cessation or remission of such trading liability, including a unilateral act of write-off of such liability in his accounts, in a subsequent tax year in which such benefit accrues; or

(ii) any amount obtained by the assessee, whether in cash or otherwise, in respect of such loss or expenditure incurred, in subsequent tax year in which the amount is obtained, whether the business or profession in respect of which the allowance or deduction was made is in existence in such subsequent tax year or not;

(b) in a case where an

S.37 Certain deductions allowed on actual payment basis only

(1) The sums payable, as specified in sub-section (2), which are otherwise allowable as a deduction under this Act, shall be allowed as a deduction while computing the income chargeable under section 26 only in the tax year in which such sums are actually paid irrespective of--

(a) any provision to the contrary in this Act; or

(b) method of accounting regularly followed; or

(c) the tax year in which the liability was incurred.

(2) The sums payable for the purposes of sub-section (1), shall be--

(a) tax, duty, cess, surcharge or fee, by whatever named called, levied under any law in force;

(b) contribution of the employer to a provident fund or superannuation fund or gratuity fund or any fund for the welfare of employees;

(c) amount payable by employer in lieu of any leave at the credit of the employee;

(d) any sum referred to in section 32(a);

(e) interest on loans or advances or borrowings from specified financial en

S.34 General conditions for allowable deductions

(1) Any expenditure (not being an expenditure of the nature specified in sections 28 to 33, 44 to 49, 51 and 52 and not being in the nature of capital expenditure or personal expenses of the assessee), laid out or expended wholly and exclusively for the purposes of the business or profession shall be allowed in computing the income chargeable under the head "Profits and gains of business or profession".

(2) For the purposes of sub-section (1), an expenditure laid out or expended wholly and exclusively for business or profession by the assessee shall not include any of the following:--

(a) an expenditure incurred for any purpose which is an offence or is prohibited by law; or

(b) an expenditure incurred on the activities relating to corporate social responsibility referred to in section 135 of the Companies Act, 2013 (18 of 2013); or

(c) an expenditure incurred on advertisement in any souvenir, brochure, tract, pamphlet or the like, published by a

S.40 Special provision for computation of cost of acquisition of certain assets

(1) For the purposes of computation of income under the head "Profits and gains of business or profession", cost of acquisition of an asset which becomes property of--

(a) an amalgamated company under a scheme of amalgamation; or

(b) an assessee, under a gift, or will, or an irrevocable trust, or on total or partial partition of a Hindu undivided family, when sold as stock-in-trade shall be the sum of--

(i) cost of acquisition of the said asset in the hands of the amalgamating company in case of clause (a), or the transferor or donor in case of clause (b);

(ii) any cost of improvement made;

(iii) any expenditure incurred by the amalgamating company or transferor or donor, as the case may be, wholly and exclusively in connection with such transfer.

(2) This section shall not apply to an asset referred to in section 67(6).

S.48 Tea development account, coffee development account and rubber development account 

(1) Where an assessee is carrying on business of growing and manufacturing tea or coffee or rubber in India , such assessee shall be allowed a deduction on the basis of deposits into the special account or deposit account and computed as per the provisions of the Schedule IX.

(2) Any amount withdrawn or utilised or released from the aforesaid accounts at the time of closure or otherwise shall be charged to tax as per the provisions of the Schedule IX.

(3) Where any asset acquired as per the special scheme or the deposit scheme, as referred to in the Schedule IX, is sold or otherwise transferred in any tax year, it shall be charged to tax in accordance with the provisions of the said Schedule.

S.47 Expenditure on agricultural extension project and skill development project

(1) Any expenditure (excluding cost of any land or building) incurred, on--

(a) agricultural extension project by any assessee; or

(b) any skill development project by a company, shall be allowed as a deduction, in the tax year in which such expenditure is incurred provided such project is notified by the Board as per the guidelines issued by it.

(2) If a deduction under this section is claimed and allowed for any tax year in respect of any expenditure referred to in sub-section (1), deduction shall not be allowed for such expenditure under any other provision of this Act for the same or any other tax year.

S.2 Definitions

In this Act, unless the context otherwise requires,--

(1) "accountant" shall have the meaning assigned to it in section 515(3)(b);

(2) "Additional Commissioner" means a person appointed to be an Additional Commissioner of Income-tax under section 237(1);

(3) "Additional Director" means a person appointed to be an Additional Director of Income-tax under section 237(1);

(4) "advance tax" means the advance tax payable as per Chapter XIX-C;

(5) "agricultural income" means--

(a) any rent or revenue derived from a land which is situated in India and is used for agricultural purposes;

(b) any income derived from such land by--

(i) agriculture; or

(ii) the performance by a cultivator or receiver of rent-in-kind of any process ordinarily employed by a cultivator or receiver of rent-in-kind to render the produce raised or received by him fit to be taken to market; or

(iii) the sale by a cultivator or receiver of rent-in-k

S.46 Capital expenditure of specified business 

(1) An assessee, at his option, shall be allowed a deduction of the whole of the capital expenditure incurred, wholly and exclusively, for the purposes of any specified business carried on by him during the tax year in which such expenditure is incurred.

(2) Where the expenditure referred to in sub-section (1) is incurred prior to the commencement of its operations and such expenditure is capitalised in the books of account as on the date of commencement of its operations, it shall be allowed during the tax year in which such business is commenced.

(3) This section shall apply to the specified business fulfilling all of the following conditions:--

(a) it is not set up by splitting up, or the reconstruction, of an already existing business;

(b) it is not set up by the transfer of machinery or plant previously used for any purpose to the specified business;

(c) if the business is of the nature referred to in sub-section (11)(d)(iii) and such busines

S.45 Expenditure on scientific research 

(1) (a) A deduction shall be allowed for any expenditure, being in the nature of--

(i) capital expenditure, but not on acquisition of land which is acquired as such or as part of any property; or

(ii) revenue expenditure, incurred on scientific research related to the business of the assessee subject to provisions of this section.

(b) A deduction shall also be allowed under this sub-section in respect of the aggregate of expenditure (not being in the nature of capital expenditure), related to business, incurred on--

(i) salary to an employee engaged in such scientific research; or

(ii) purchase of materials used in such scientific research, where such expenditure is incurred within three years immediately preceding the commencement of business, to the extent certified by the prescribed authority as incurred on such research and such expenditure shall be deemed to have been incurred in the tax year in which the business is commenced.

(c) For

S.18 Profits in lieu of salary

(1) For the purposes of this Part, "profits in lieu of salary" includes,--

(a) the amount of any compensation due to, or received by, an assessee from his employer or former employer at or in connection with the--

(i) termination of his employment; or

(ii) modification of the terms and conditions relating thereto;

(b) any amount due to, or received, whether in lump sum or otherwise, by any assessee from any person--

(i) before his joining any employment with that person; or

(ii) after cessation of his employment with that person;

(c) any payment due to or received by an assessee--

(i) from an employer or a former employer; or

(ii) from a provident or other fund, to the extent to which it does not consist of contributions by the assessee or interest on such contributions; or

(iii) any sum received under a Keyman insurance policy as defined in Schedule II (Note 1), including the sum allocated by way of bonus on su

S.3 Definition of "tax year"

(1) For the purposes of this Act, "tax year" means the twelve months period of the financial year commencing on the 1st April.

(2) In the case of a business or profession newly set up, or a source of income newly coming into existence in any financial year, the tax year shall be the period beginning with--

(a) the date of setting up of such business or profession; or

(b) the date on which such source of income newly comes into existence, and ending with the said financial year.

S.434 Form of claim for refund and limitation

Section 434 -

(1) Where,--

(a) under an agreement or other arrangement, in writing, the tax deductible on any income, other than interest in section 393(2) (Table: Sl. No. 17), is to be borne by the person by whom the income is payable; and (b) such person having paid such tax to the credit of the Central Government claims that no tax was required to be deducted on such income, he may, within thirty days from the date of payment of such tax, file an application before the Assessing Officer for refund of such tax in such form and such manner, as may be prescribed.

(2) The Assessing Officer shall, by an order in writing, allow or reject the application as referred to in sub-section (1).

(3) No application under sub-section (1) shall be rejected unless an opportunity of being heard has been given to the applicant.

(4) The Assessing Officer may, before passing an order under sub-section (2), make such inquiry as he considers necessary.

(5) The

S.429 Fee for default relating to statement or certificate

(1) Without prejudice to the provisions of this Act, where,--

(a) the research association, University, college or other institution referred to in section 45(3)(a) or the company referred to in section 45(3)(b) fails to deliver or cause to be delivered the documents as may be prescribed in section 45(4)(a) within the time as may be prescribed therein or furnish a certificate as may be prescribed under section 45(4)(a); or

(b) the institution or fund fails to deliver or cause to be delivered a statement under section 354(1)(e), within the time as may be prescribed under that section, or furnish a certificate as may be prescribed under section 354(1)(g), it shall be liable to pay, by way of fee, a sum of ₹200 for every day during which the failure continues.

(2) The amount of fee referred to in sub-section (1) shall,--

(a) not exceed the amount in respect of which the failure referred to therein has occurred;

(b) be paid before delivering or causin

S.426 Interest on excess refund

(1) Subject to the other provisions of this Act, where any refund is granted to the assessee under section 270(1), and--

(a) no refund is due on regular assessment; or

(b) the amount refunded under section 270(1) exceeds the amount refundable on regular assessment, the assessee shall be liable to pay simple interest at the rate of 0.5% on the whole or the excess amount so refunded, for every month or part of a month comprised in the period from the date of grant of refund to the date of such regular assessment.

(2) Where, as a result of an order under section 287 or 288 or 359 or 363 or 365(10) or 368 or 377 or 378, the amount of refund granted under section 270(1) is held to be correctly allowed, either in whole or in part, then, the interest chargeable, if any, under sub-section (1) shall be reduced accordingly.

(3) Where in relation to a tax year, an assessment is made for the first time under section 279, the assessment so made shall be regarded as a

S.432 Person entitled to claim refund in certain special cases

(1) Where the income of one person is included in total income of any other person under any provision of this Act, the latter alone shall be eligible for a refund under this Chapter in respect of such income.

(2) Where a person is unable to claim or receive a refund due to him, on 10 account of death, incapacity, insolvency, liquidation or other cause, his legal representative or the trustee or guardian or receiver, shall be entitled to claim or receive such refund for the benefit of such person or his estate.

S.435 Refund on appeal, etc 

(1) Where, as a result of any order passed in appeal or other proceeding under this Act, refund of any amount becomes due to the assessee, the Assessing Officer shall, except as otherwise provided in this Act, refund the amount to the assessee without his having to make any claim in that behalf.

(2) Where, by the order as referred to in sub-section (1),--

(a) an assessment is set aside or cancelled and an order of fresh assessment is directed to be made, the refund, if any, shall become due only on the making of such fresh assessment;

(b) the assessment is annulled, the refund shall become due only of the amount, if any, of the tax paid in excess of the tax chargeable on the total income returned by the assessee.

S.430 Fee for default relating to intimation of Aadhaar number

Without prejudice to the provisions of this Act, where a person is required to intimate his Aadhaar number under section 262(6) and such person fails to do so on or before such date as may be prescribed, he shall be liable to pay such fee, as may be prescribed, not exceeding ₹1000, at the time of making intimation under the said section after the said date.

S.436 Correctness of assessment not to be questioned 

In a claim under this Chapter, it shall not be open to the assessee to question the correctness of any assessment, or other matter decided which has become final and conclusive, or ask for a review of the aforesaid assessment or matter; and the assessee shall not be entitled to any relief on such claim except refund of tax wrongly paid or paid in excess.

S.431 Refunds

If any person satisfies the Assessing Officer that the amount of tax paid by him or on his behalf or treated as paid by him or on his behalf for any tax year exceeds the amount with which he is properly chargeable under this Act for that 5 year, he shall be entitled to a refund of the excess.

S.433 Form of claim for refund and limitation 

Every claim for refund under this Chapter shall be made by furnishing return as per section 263.

S.439 Penalty for under-reporting and misreporting of income

(1) The Competent Authority may, during the course of any proceedings under this Act, impose penalty on any person who has under-reported his income and such penalty shall be payable in addition to tax, if any.

(2) A person shall be deemed to have under-reported his income, if--

(a) the income assessed is greater than the income determined in the return processed under section 270(1)(a);

(b) the income assessed is greater than the maximum amount not chargeable to tax, where no return of income has been furnished or where return has been furnished for the first time under section 280;

(c) the income reassessed is greater than the income assessed or reassessed immediately before such reassessment;

(d) the amount of deemed total income assessed or reassessed as per section 206 (1) and (2), is greater than the deemed total income determined in the return processed under section 270(1)(a);

(e) the amount of deemed total income assessed as per se

S.437 Interest on refunds 

(1) Where a refund is due to the assessee under this Act, he shall, subject to the provisions of this section, be entitled to receive, in addition to the refund, simple interest thereon calculated at the rate of 0.5% for every month or part of a month, in the circumstances specified in column B of the Table below, for the period specified in column C of the said Table.

Table Sl. No. Circumstances Period A B C

1. Where the refund is out of tax collected at source under section 394 or paid by way of advance tax or treated as paid under section 390(5), during the financial year.

(a) From the first day of April of the year following the tax year to the date on which the refund is granted, where the return of income has been furnished on or before the due date as specified in section 263(1);

(b) from the date of furnishing the return of income to the date on which the refund is granted; in any other case.

2. Where the refund is out of any tax paid u

S.440 Waiver of penalty and immunity from prosecution 

440. 1[Waiver of penalty and immunity from prosecution.]  2 [(1) An assessee may make an application to the Assessing Officer to grant waiver of penalty levied under section 439 and immunity from initiation of proceedings under section 478 or 479 on fulfilment of the following conditions:--

(a) the tax and interest payable as per the order of assessment under section 270(10) or reassessment under section 279, has been paid within the period specified in the notice of demand;

(b) where penalty has been levied under the circumstances referred to in section 439(11)(a) to (f), additional income-tax amounting to 100% of the amount of tax payable on under-reported income has been paid within the period specified in the notice of demand, in lieu of such penalty;

(c) where penalty has been levied under the circumstances referred to in section 439(11)(g), additional income-tax amounting to 120% of the amount of tax payable on under-reported income has been paid within t

S.438 Set off and withholding of refunds in certain cases

(1) Where a refund becomes due or is found to be due to any person under this Act, the Assessing Officer or Commissioner or Principal Commissioner or Chief Commissioner or Principal Chief Commissioner, as the case may be, may in lieu of payment of the refund, set off the amount to be refunded or any part of that amount, against the sum, if any, remaining payable under 1[the Income-tax Act, 1961 (43 of 1961), or] this Act by such person.

(2) Any action under sub-section (1) shall be taken after giving an intimation in writing to such person of the action proposed to be taken.

(3) Where,--

(a) a part of the refund is set off under sub-section (1); or

(b) no such amount as referred to in clause (a) is set off, and refund becomes due to a person, and the Assessing Officer, having regard to the fact that proceedings for assessment or reassessment are pending in the case of such person, may, for reasons to be recorded in writing and with the previous approval

S.442 Penalty for failure to keep and maintain information and document, etc., in respect of certain transactions 

(1) The Assessing Officer or Commissioner (Appeals) may impose a penalty of 2% of the value of each international transaction or specified domestic transaction entered into by a person, if in respect of such transaction he,--

(a) fails to keep and maintain any such information and document as required by section 171(1);

(b) fails to report such transaction which he is required to do so; or

(c) maintains or furnishes an incorrect information or document.

(2) The prescribed income-tax authority referred to in section 171(4) may impose a penalty of ₹500000 on a person, if he fails to furnish the information and document required under the said section.

S.443 Omitted 

1 [***]

---------------------------------------------

1 . Omitted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"443. Penalty in respect of certain income (1) The Assessing Officer or the Joint Commissioner (Appeals) or Commissioner (Appeals) may impose a penalty of 10% of the tax payable under section 195(1)(i), on an assessee if the income determined in his case for any tax year includes any income referred to in section 102, 103, 104, 105 or 106.

(2) The penalty under sub-section (1) shall be payable in addition to the tax payable under section 195.

(3) No penalty shall be levied on income referred to in section 102, 103, 104, 105 or 106 to the extent such income has been included by the assessee in the return of income furnished under section 263 and the tax as per section 195(1)(i) has been paid on or before the end of the relevant tax year.

(4) No penalty under section 439 shall be imposed upon the assessee in respect

S.441 Failure to keep, maintain or retain books of account, documents, etc 

A penalty of ₹25000 may be imposed on a person by the Assessing Officer or the Joint Commissioner (Appeals) or the Commissioner (Appeals), if he fails to--

(a) keep and maintain the books of account and other documents as per section 62 or the rules made thereunder, in respect of any tax year; or

(b) retain such books of account and other documents for the period specified in the said rules.

S.446 446. Penalty for failure to furnish information or for furnishing inaccurate information on transaction of crypto-asset. 

1 [ 446. Penalty for failure to furnish information or for furnishing inaccurate information on transaction of crypto-asset.

(1) If any person who is required to furnish a statement in respect of a transaction of a crypto-asset under section 509(1), fails to furnish such statement within the time prescribed under the said section, the prescribed income-tax authority under that section may impose on him, a penalty of ₹ 200 for every day for which such failure continues.

(2) The prescribed income-tax authority may impose a penalty of ₹ 50000 on a person referred in sub-section (1), if such person--

(a) provides inaccurate information in the statement and fails to remove such inaccuracy as per section 509(4); or

(b) fails to comply with due diligence the requirement under section 509(5).]

---------------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"446. Failure to get accounts au

S.444 Penalty for false entry, etc., in books of account

(1) The Assessing Officer or the Joint Commissioner (Appeals) or the Commissioner (Appeals), may impose a penalty equal to the aggregate amount of false or omitted entry, where during any proceeding under this Act, it is found that in the books of account maintained by any person there is--

(a) a false entry; or

(b) an omission of any entry which is relevant for computation of total income of such person, to evade tax liability.

(2) Without prejudice to sub-section (1), the Assessing Officer or the Joint Commissioner (Appeals) or the Commissioner (Appeals) may impose a penalty equal to the aggregated amount of false or omitted entry, on any other person, who causes the person referred to in the said sub-section in any manner to make a false entry or omits or causes to omit any entry referred to in that sub-section.

(3) For the purposes of this section, the expression "false entry" includes use or intention to use--

(a) forged or falsified document

S.445 Benefits to related persons 

If during any proceedings under this Act, it is found that a person being a registered non-profit organisation has any specified income which is chargeable to tax as per section 337 (Table: Sl. No. 2), the Assessing Officer may impose on such person, a penalty of--

(a) a sum equal to the aggregate amount of income applied, directly or indirectly, by such person, for the benefit of any related person referred to in section 355(h), if the violation is noticed for the first time during any tax year; and (b) a sum equal to 200% of the aggregate amount of income of such person applied, directly or indirectly, by that person for the benefit of any person referred to in section 355(h), if the violation is noticed again in any subsequent tax year.

S.447 Omitted

1 [***]

-------------------------------

1 . Omitted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"447. Penalty for failure to furnish report under section 172 If any person fails to furnish a report from an accountant as required by section 172, the Assessing Officer may impose a penalty of ₹100000 on such person."

S.448 Penalty for failure to deduct tax at source 

If any person fails to--

(a) deduct the whole or any part of the tax as required under Chapter XIX-B; or

(b) pay or ensure the payment of, the whole or any part of the tax as required by or under--

(i) Note 2 below the Table in section 393(3); or

(ii) Note 6 to section 393(1) (Table: Sl. No. 8), then, the Assessing Officer may impose on him, a penalty equal to the tax which such person failed to deduct or pay or ensure payment of, as aforesaid.

S.450 Penalty for failure to comply with provisions of section 185 

If a person takes or accepts any loan or deposit or specified sum in contravention of the provisions of section 185, the Assessing Officer may impose on him, a penalty equal to the amount of the loan or deposit or specified sum so taken or accepted.

S.449 Penalty for failure to collect tax at source 

(1) If any person fails to collect the whole or any part of the tax as required under Chapter XIX-B, the Assessing Officer may impose on him, a penalty equal to the tax which such person failed to collect.

S.452 Penalty for failure to comply with provisions of section 187 

The Assessing Officer may impose on a person, a penalty of ₹5000 for every day of the duration of failure where he fails to provide a facility for accepting payments through the prescribed electronic modes of payment, as referred to in section 187.

S.453 Penalty for failure to comply with provisions of section 188

If a person repays any loan or deposit or specified advance referred to in section 188 otherwise than in accordance with the provisions of that section, the Assessing Officer may impose on him, a penalty equal to the loan or deposit or specified advance so repaid.

S.451 Penalty for failure to comply with provisions of section 186 

Section 451 - 

The Assessing Officer may impose on a person, a penalty equal to the sum received by him in contravention of the provisions of section 186.

S.459 Penalty for failure to furnish report or for furnishing inaccurate report under section 511 

(1) If any reporting entity referred to in section 511, required to furnish the report referred to in sub-section (2) of the said section, for a reporting accounting year, fails to do so, the prescribed authority under that section may impose on such entity, a penalty of--

(a) ₹5000 for every day for which the failure continues, if the period of failure does not exceed one month;

(b) ₹15000 for every day for which the failure continues beyond the period of one month.

(2) If any reporting entity referred to in section 511 fails to produce the information and documents within the period allowed under sub-section (7) of the said section, the prescribed authority under that section may impose on such entity, a penalty of ?5000 for every day during which the failure continues, beginning from the day immediately following the day on which the period for furnishing the information and document expires.

(3) If the failure referred to in sub-section (1) or (2) co

S.454 Penalty for failure to furnish statement of financial transaction or reportable account after a notice

1 [ 454. Penalty for failure to furnish statement of financial transaction or reportable account after a notice Where any person, who is required to furnish a statement of financial transaction or reportable account under section 508(1), fails to furnish such statement or reportable account within the period specified in the notice issued under section 508(7), the income-tax authority prescribed under section 508(1) may impose on him, a penalty of ₹ 1000 for every day for which such failure continues, beginning from the day immediately after the period specified in such notice for furnishing such statement or reportable account expires and such penalty shall not exceed ₹ 100000.]

------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"454. Penalty for failure to furnish statement of financial transaction or reportable account (1) If a person who is required to furnish a statement of financial transaction or

S.455 Penalty for furnishing inaccurate statement of financial transaction or reportable account 

(1) The prescribed income-tax authority referred to in section 508 may direct that a person required to furnish a statement under sub-section (1) of the said section shall pay penalty of ₹50000, if such person-

(a) provides inaccurate information in the statement or fails to furnish correct information within the period specified under section 508(5); or

(b) fails to comply with the due diligence requirement under section 508(9).

(2) The prescribed income-tax authority referred to in section 508, shall direct that reporting financial institution referred to in section 508(1)(k) of the, shall, in addition to the penalty under sub-section (1) of this section, if any, pay a sum of ₹5000 for every inaccurate reportable account, if--

(a) the said institution provides inaccurate information in the statement required to be furnished under section 508(1); and (b) the inaccuracy in the said statement is due to false or inaccurate information furnished by the hold

S.458 Penalty for failure to furnish information or document under section 506

If any Indian concern, which is required to furnish any information or document under section 506, fails to do so, the prescribed income-tax authority under the said section, may direct that such Indian concern shall pay by way of penalty, a sum of--

(a) 2% of the value of the transaction in respect of which such failure has taken place, if such transaction had the effect of directly or indirectly transferring the right of management or control in relation to the Indian concern;

(b) ₹500000, in any other case.

S.263 Return of income

(1) (a) Every person as mentioned below shall, for a tax year, on or before the due date, furnish a return of his income or the income of any other person in respect of which he is assessable during the said tax year:--

(i) a company;

(ii) a firm;

(iii) a person other than a company or a firm, if his total income or the total income of any other person in respect of which he is assessable under this Act during the tax year, without giving effect to the provisions of Chapter XVII-B or provisions of Schedule VIII (Table: Sl. No. 1) or deductions allowable under section 82 or 83 or 84 or 85 or 86 or 87 or 88 of Chapter IV-E or Chapter VIII, as the case may be, exceeded the maximum amount which is not chargeable to income-tax;

(iv) a specified entity, if its total income without giving effect to the provisions of section 11 exceeds the maximum amount which is not chargeable to income-tax;

(v) a University, college or other institution as referred to i

S.262 Permanent Account Number

(1) Every person who has not been allotted a Permanent Account Number shall, within such time as may be prescribed, apply to the Assessing Officer for its allotment if he fulfils any of the following conditions:--

(a) his total income or the total income of any other person for which he is assessable under this Act during any tax year exceeded the maximum amount not chargeable to income-tax; or

(b) he is carrying on any business or profession whose total sales, turnover or gross receipts are or is likely to exceed ? 500000 in any tax year; or

(c) he is required to furnish a return of income under section 263 for any tax year; or

(d) he is a resident, other than an individual, which enters into a financial transaction aggregating to ? 250000 or more in a tax year; or

(e) he is the managing director, director, partner, trustee, author, founder, karta, chief executive officer, principal officer or office bearer of the person referred to in clause (d)

S.261 Interpretation 

For the purposes of this Part,--

(a) "approving authority" means--

(i) the Principal Director General or the Director General; or

(ii) the Principal Chief Commissioner or the Chief Commissioner; or

(iii) the Principal Director or the Director; or

(iv) the Principal Commissioner or the Commissioner;

(b) "asset" includes any money, bullion, jewellery, virtual digital asset or other valuable article or thing, held in physical or virtual form;

(c) "authorised officer" means--

(i) the Joint Director or the Additional Director; or

(ii) the Joint Commissioner or the Additional Commissioner; or

(iii) the Assistant Director or the Deputy Director; or

(iv) the Assistant Commissioner or the Deputy Commissioner; or

(v) the Income-tax Officer or the Tax Recovery Officer;

(d) "competent authority" means--

(i) the Principal Director General or the Director General; or

(ii) the Principal Chief

S.265 Return by whom to be verified

The return of income under section 263 required to be furnished by the person specified in column B of the Table below shall be verified by the person specified in corresponding entry in column C of the said Table:

Table Sl. No. Person furnishing return of income To be verified A B C

1. An individual.

(i) By the individual himself;

(ii) where the individual is mentally incapacitated from attending to his affairs, by his guardian or any other person competent to act on his behalf;

(iii) where, for any other reason, it is not possible for the individual to verify the return, by any person duly authorised by him through a valid power of attorney.

2. A Hindu undivided family.

(i) By the karta;

(ii) where the karta is absent from India or is mentally incapacitated from attending to his affairs, by any other adult member of such family.

3. A company in cases other than those mentioned at serial numbers 4, 5, 6 and 7.

S.260 Faceless collection of information

(1) The Central Government may make a scheme, by notification, for the purposes of calling for information under section 252, collecting certain information under section 254, or calling for information by prescribed income-tax authority under section 259, or exercise of power to inspect register of companies under section 255, or exercise of power of Assessing Officer under section 256 so as to impart greater efficiency, transparency and accountability by--

(a) eliminating the interface between the income-tax authority and the assessee or any other person to the extent technologically feasible;

(b) optimising utilisation of the resources through economies of scale and functional specialisation;

(c) introducing a team-based exercise of powers, including to call for, or collect, or process, or utilise, the information, with dynamic jurisdiction.

(2) The Central Government may, for the purpose of giving effect to this scheme made under sub-section (1), by

S.264 Scheme for submission of returns through tax return preparers 

(1) The Board may make a Scheme for furnishing returns of income through a tax return preparer and such Scheme shall be notified, which--

(a) may enable any specified class or classes of persons in preparing and furnishing returns of income through a tax return preparer authorised to act as such under the Scheme;

(b) may be made irrespective of provisions of section 263.

(2) For the purpose of this section,--

(a) "tax return preparer" means any individual, not being a person referred to in section 515(3)(a)(ii) or an employee of the "specified class or classes of persons", who has been authorised to act as a tax return preparer under the Scheme made under this section;

(b) "specified class or classes of persons" means any person, other than a company or a person, whose accounts are required to be audited under section 63 or under any other law, who is required to furnish a return of income under this Act.

(3) Every notification for the Sche

S.256 Power of certain income-tax authorities

The Principal Director General or Director General or Principal Director or Director, the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner and the Joint Commissioner shall be competent to make any enquiry under this Act, and for this purpose, shall have all the powers that an Assessing Officer has under this Act in relation to the making of enquiries.

S.266 Self-assessment

(1) Where, after taking into account the amounts referred to in sub-section (2), any tax is payable on the basis of any return required to be furnished under section 263 or 268 or 280 or 294, then--

(a) the assessee shall be liable to pay such tax together with interest and fee payable under any provision of this Act for any delay in furnishing the return or any default or delay in payment of advance tax, before furnishing the return; and (b) the return shall be accompanied by proof of payment of tax, interest and fee.

(2) The amounts referred to in sub-section (1) shall be,--

(a) the amount of tax, if any, already paid under any provision of this Act;

(b) any tax deducted or collected at source;

(c) any relief of tax claimed under section 157;

(d) any relief of tax or deduction of tax claimed under section 159(1) or 160 on account of tax paid in a country outside India;

(e) any relief of tax claimed under section 159(2) on account o

S.270 Assessment

(1) Where a return has been made under section 263, or in response to a notice under section 268(1) such return shall be processed in the following manner:--

(a) the total income or loss shall be computed after making the adjustments towards the following:--

(i) any arithmetical error in the return; or

(ii) an incorrect claim, if such incorrect claim is apparent from any information in the return; or

(iii) any such inconsistency in the return, with respect to the information in the return of any preceding tax year, as may be prescribed; or

(iv) disallowance of loss claimed, if return of the tax year for which set off of loss is claimed was furnished beyond the due date specified under section 263(1); or

(v) disallowance of expenditure or increase in income indicated in the audit report but not taken into account in computing the total income in the return; or

(vi) disallowance of deduction claimed 1[***] under any of the provisions o

S.267 Tax on updated return

(1) Where no return of income under section 263(1) or (4) has been furnished by an assessee and, after taking into account the amounts referred to in sub-section (2), tax is payable on the basis of return to be furnished by such assessee under section 263(6), then--

(a) the assessee shall be liable to pay such tax together with interest and fee payable under any of the provisions of this Act for any delay in furnishing the return or any default or delay in payment of advance tax;

(b) such tax, interest and fee shall be payable along with the payment of additional income-tax computed as per sub-section (5), before furnishing the return; and (c) the return shall be accompanied by proof of payment of such tax, additional income-tax, interest and fee.

(2) The amounts referred to in sub-section (1) shall be,--

(a) the amount of tax, if any, already paid as advance tax;

(b) any tax deducted or collected at source;

(c) any relief of tax claimed un

S.268 Inquiry before assessment

(1) For the purpose of making an assessment under this Act, the Assessing Officer may serve on any person who has made a return under section 263 or in whose case the time allowed under section 263(1) for furnishing the return has expired, a notice requiring him, on a date to be specified therein,--

(a) where such person has not made a return within the time allowed under section 263(1) or before the end of the financial year succeeding the relevant tax year, to furnish a return of his income or the income of any other person in respect of which he is assessable under this Act, in such form and verified in such manner and setting forth such other particulars as may be prescribed;

(b) to produce, or cause to be produced, such accounts or documents as the Assessing Officer may require;

(c) to furnish in writing and verified in the manner as may be prescribed information in such form and on such points or matters (including a statement of all assets and liabilitie

S.269 Estimation of value of assets by Valuation Officer

(1) The Assessing Officer may, for the purposes of assessment or reassessment, make a reference to a Valuation Officer to estimate the value, including the fair market value, of any asset, property or investment and submit a copy of report to him.

(2) The Assessing Officer may make a reference to the Valuation Officer under sub-section (1) whether or not he is satisfied about the correctness or completeness of the accounts of the assessee.

(3) (a) For estimating the value, including the fair market value, of the asset, property, or investment, the Valuation Officer or any engineer, overseer, surveyor, or assessor authorized by such Valuation Officer, may, subject to any rules made in this regard and at such reasonable times, as may be prescribed,--

(i) enter any land within the limits of the area assigned to the Valuation Officer; or

(ii) enter any land, building, or other place belonging to or occupied by any person in connection with whose assessment a

S.272 Power of Joint Commissioner to issue directions in certain cases

(1) A Joint Commissioner may, on his own motion or on a reference being made to him by the Assessing Officer or on the application of an assessee, call for and examine the record of any proceeding in which an assessment is pending and, if he considers that, having regard to the nature of the case or the amount involved or for any other reason, it is necessary or expedient so to do, he may--

(a) issue such directions as he thinks fit for the guidance of the Assessing Officer to enable him to complete the assessment; and (b) such directions shall be binding on the Assessing Officer.

(2) No directions which are prejudicial to the assessee shall be issued under sub-section (1) without giving an opportunity of being heard to the assessee.

(3) For the purposes of this section, no direction as to the lines on which an investigation connected with the assessment should be made, shall be deemed to be a direction prejudicial to the assessee.

S.271 Best judgment assessment

(1) If any person--

(a) fails to furnish the return required under section 263(1) or (4) or (5) or (6); or

(b) fails to comply with all the terms of a notice issued under section 268(1) or fails to comply with a direction issued under section 268(5); or

(c) having made a return, fails to comply with all the terms of a notice issued under section 270(8), the Assessing Officer, after taking into account all relevant materials which he has gathered, shall, after giving the assessee an opportunity of being heard, make the assessment of the total income or loss to the best of his judgment and determine the sum payable by the assessee on the basis of such assessment.

(2) The Assessing Officer before making an assessment under sub-section (1) shall, subject to the provisions of sub-section (3), serve a notice on the assessee to show cause, on a date and time to be specified in the notice, as to why assessment should not be completed to the best of his judgment.

S.274 Reference to Principal Commissioner or Commissioner in certain cases

(1) The Assessing Officer may make a reference to the Principal Commissioner or Commissioner at any stage of the assessment or reassessment proceedings before him, if, having regard to the material and evidence available with him, he considers that it is necessary to--

(a) declare an arrangement as an impermissible avoidance arrangement; and (b) determine the consequence of such an arrangement within the meaning of Chapter XI.

(2) The Principal Commissioner or Commissioner shall, on receipt of a reference under sub-section (1), if he is of the opinion that the provisions of Chapter XI are required to be invoked,--

(a) issue a notice to the assessee, setting out the reasons and basis of such opinion, for submitting objections, if any; and (b) provide an opportunity of being heard to the assessee within such period, not exceeding sixty days, as specified in the said notice.

(3) If the assessee fails to furnish any objection to the notice within the time sp

S.273 Faceless Assessment 

(1) Irrespective of anything to the contrary contained in any other provision of this Act, the assessment, reassessment or recomputation under section 270(10) or 271 or 279, as the case may be, with respect to the cases referred to in sub-section (2), shall be made in a faceless manner as per such procedure, as may be prescribed in this behalf.

(2) The faceless assessment under sub-section (1) shall be made in respect of such territorial area, or persons or class of persons, or incomes or class of incomes, or cases or class of cases, as may be specified by the Board.

(3) The Board may, for the purposes of faceless assessment, set up the following Centre and Units and specify their functions and jurisdiction:--

(a) a National Faceless Assessment Centre to facilitate the conduct of faceless assessment proceedings in a centralised manner including assigning the case selected for the purposes of faceless assessment under this section to a specific assessment unit,

S.275 Reference to Dispute Resolution Panel

(1) The Assessing Officer shall, irrespective of anything to the contrary contained in this Act, in the first instance, forward a draft of the proposed order of assessment (hereafter in this section referred to as the draft order) to the eligible assessee, if he proposes to make any variation which is prejudicial to the interest of such assessee.

(2) On receipt of the draft order, the eligible assessee shall, within thirty days of its receipt by him,--

(a) file his acceptance of the variations to the Assessing Officer; or

(b) file his objections, if any, to such variation with,--

(i) the Dispute Resolution Panel; and (ii) the Assessing Officer.

(3) The Assessing Officer shall complete the assessment on the basis of the draft order, if--

(a) the assessee intimates to the Assessing Officer the acceptance of the variation; or

(b) no objection is received within the period specified in sub-section (2).

1 [(4) (a) The Assessing Off

S.277 Method of accounting in certain cases

(1) For the purposes of determining the income chargeable under the head "Profits and gains of business or profession",--

(i) the valuation of inventory shall be made at lower of actual cost or net realisable value computed as per the income computation and disclosure standards notified under section 276(2);

(ii) the valuation of purchase and sale of goods or services and valuation of inventory shall be adjusted to include any tax, duty, cess or fee (by whatever name called) actually paid or incurred by the assessee to bring the goods or services to the place of its location and condition as on the date of valuation;

(iii) the inventory being securities not listed on a recognised stock exchange, or listed but not quoted on a recognised stock exchange with regularity from time to time, shall be valued at actual cost initially recognised as per the income computation and disclosure standards notified under section 276(2);

(iv) the inventory being securitie

S.276 Method of accounting

(1) Income chargeable under the head "Profits and gains of business or profession" or "Income from other sources" shall, subject to the provisions of sub-section (2), be computed as per either cash or mercantile system of accounting regularly employed by the assessee.

(2) The Central Government may notify income computation and disclosure standards to be followed by any class of assessees or in respect of any class of income.

(3) The Assessing Officer may make an assessment in the manner provided in section 271, where--

(a) he is not satisfied about the correctness or completeness of the accounts of the assessee; or

(b) the method of accounting provided in sub-section (1) has not been regularly followed by the assessee; or

(c) income has not been computed as per the standards notified under sub-section (2).

Sch.I [See section 9(12)]

SCHEDULE I

Conditions for certain activities not to constitute business connection in India .

1. (1) The eligible investment fund referred to in section 9(12), means a fund established or incorporated or registered outside India, which collects funds from its members for investing it for their benefit and fulfils the following conditions:-- (a) the fund is not a person resident in India ;

(b) the fund is--

(i) a resident of a country or a specified territory with which an agreement referred to in section 159(1) or (2) has been entered into; or

(ii) established or incorporated or registered in a country or a specified territory as notified in this behalf;

(c) the aggregate participation or investment in the fund, directly, by persons resident in India does not exceed 5% of the corpus of the fund as on the 1st April and the 1st October of the tax year, subject to the conditions that--

(i) for the purposes of calculation of such agg

S.463 Penalty for furnishing incorrect information in reports or certificates 

(1) Any accountant or merchant banker or registered valuer, shall be liable to pay a penalty of ₹10000 for any incorrect information in any report or certificate furnished under any provision of this Act or the rules made thereunder.

(2) The penalty under sub-section (1) shall be payable for each such report or certificate.

(3) The penalty under sub-section (1) shall be payable on directions of the Assessing Officer or the Joint Commissioner (Appeals) or the Commissioner (Appeals) where the incorrect information mentioned in sub-section (1) is found by such authority in the course of any proceedings under this Act.

(4) In this section,--

(a) "merchant banker" means Category I merchant banker registered with the Securities and Exchange Board of India established under section 3 of the Securities and Exchange Board of India Act, 1992 (15 of 1992); and (b) "registered valuer" means a person registered as a valuer under section 514.

S.456 Penalty for failure to furnish statement or information or document by an eligible investment fund 

If any eligible investment fund required to furnish a statement or any information or document under paragraph 4 of Schedule I, fails to do so within the time prescribed under the said paragraph, the income-tax authority prescribed under the said paragraph may direct that such fund shall pay, by way of penalty, a sum of ₹500000.

S.457 Penalty for failure to furnish information or document under section 171

If any person who has entered into an international transaction or specified domestic transaction fails to furnish any such information or document as required under section 171(2), a penalty equal to 2 % of the value of such transaction may be imposed upon him for each such failure by the Assessing Officer or the Transfer Pricing Officer as referred to in section 166 or the Commissioner (Appeals).

S.462 Penalty for failure to furnish information or furnishing inaccurate information under section 397 (3)(d) 

If any person, who is required to furnish information under section 397(3)(d), fails to furnish such information, or furnishes inaccurate information, the Assessing Officer may impose a penalty of ₹100000 on such person.

S.460 Penalty for failure to submit statement under section 505

If any person required to furnish statement under section 505, fails to do so within the period prescribed under that section, the Assessing Officer may impose on him, a penalty of--

(a) ₹1000 for every day for which the failure continues, if the period of failure does not exceed three months; or

(b) ₹100000 in any other case.

S.465 Penalty for failure to answer questions, sign statements, furnish information, returns or statements, allow inspections, etc 

(1) A person shall be liable to pay a penalty of ₹10000 for each default or failure as mentioned below, if that person--

(a) being legally bound to state the truth of any matter touching the subject of his assessment, refuses to answer any question put to him by an income-tax authority in the exercise of its powers under this Act; or

(b) refuses to sign any statement made by him in the course of any proceedings under this Act, which an income-tax authority may legally require him to sign; or

(c) to whom a summons is issued under section 246(1), either to attend to give evidence or to produce books of account or other documents at a certain place and time omits to attend or produce books of account or documents at the place or time; or

(d) fails to comply with a notice under section 268(1) or 270(8) or fails to comply with a direction issued under section 268(5).

(2) A person shall be liable to pay a penalty of ₹500 for every day during which the f

S.469 Power to reduce or waive penalty, etc., in certain cases 

(1) Irrespective of anything contained in this Act, the Principal Commissioner or Commissioner may, whether on his own motion or otherwise, at his discretion reduce or waive the penalty imposed or imposable under section 439 if he is satisfied that such person,--

(a) before the Assessing Officer detected any concealment of particulars of income or of the inaccuracy of particulars furnished in respect of such income, has made a full and true disclosure of such particulars voluntarily and in good faith; and (b) has cooperated in any enquiry relating to the assessment of his income and has paid or made satisfactory arrangements to pay any tax or interest payable in consequence of an order passed under this Act in respect of the relevant tax year.

(2) For the purposes of sub-section (1), a person shall be deemed to have made full and true disclosure of his income or of the particulars relating thereto if the difference between the assessed and returned income does not att

S.467 Penalty for failure to comply with the provisions of sections 262 and 397 

467. Penalty for failure to comply with the provisions of 1[sections 262 and 397]  (1) If a person fails to comply with the provisions of section 262 and section 397(2)(h), the Assessing Officer may impose a penalty of ₹10000 on him.

(2) If a person, required to quote or intimate his Permanent Account Number or Aadhaar number in any document as referred to in section 262(9)(a), provides or quotes or intimates a number which is false, knowing or believing it to be false, the Assessing Officer may impose a penalty of ₹10000 on him for each such default.

(3) If a person fails to quote or authenticate his permanent Account Number or Aadhaar number in any document referred to in section 262(9)(a), the Assessing Officer may impose a penalty of ₹10000 on him for each such default.

(4) If a person referred to in section 262(9)(b) responsible for ensuring the correct quoting or authentication of Permanent Account Number or Aadhaar number, in documents relating to transa

S.471 Procedure 

(1) No order imposing a penalty under this Chapter shall be made unless the assessee has been heard, or has been given a reasonable opportunity of being heard 1[by way of a show cause notice to that effect].

(2) No order imposing a penalty under this Chapter shall be made without the prior approval of the Joint Commissioner--

(a) where the penalty exceeds ₹10000, by the Income-tax Officer;

(b) where the penalty exceeds ₹20000, by the Assistant Commissioner or Deputy Commissioner.

(3) An income-tax authority on making an order under this Chapter imposing a penalty, unless he himself is the Assessing Officer, shall send a copy of the order to the Assessing Officer.

1 [(4) Irrespective of anything contained in any other provision of this Act, where any draft of the proposed order of assessment under section 275 or assessment under section 270 or reassessment under section 279 is made on or after the 1st April, 2027,--

(a) penalty under section

S.468 Penalty for failure to comply with the provisions of section 397 

(1) If a person fails to comply with the provisions of section 397, the Assessing Officer may impose a penalty of ₹10000 on him.

(2) If a person, required to quote his Tax Deduction and Collection Account Number in challans, certificates statements or other documents referred to in section 397(1)(b), quotes a number which is false, knowing or believing it to be false or not true, the Assessing Officer may impose a penalty of ₹10000 on him.

S.464 Penalty for failure to furnish statements, etc 

The Assessing Officer may impose a penalty which shall not be less than ₹10000 but which may extend up to ₹100000 on--

(a) the research association, university, college or other institution referred to in section 45, if it fails to deliver or furnish the documents as may be prescribed under section 45(4)(a); or

(b) the institution or fund, if it fails to deliver or cause to be delivered a statement within the time prescribed under section 354(1)(e), or furnish a certificate prescribed under section 354(1)(g).

S.470 Penalty not to be imposed in certain cases 

Irrespective of anything contained in the provisions of section 441 or 442 or 446 1[***] or 448 or 449 or 450 or 451 or 452 or 453 or 454 or 455 or 456 or 457 or 458 or 459 or 460 or 461 or 462 or 463 or 465(1)(c) or 465(1)(d) or 465(2) or 466 or 467 or 468, no penalty shall be imposed on a person or assessee for any failure referred to in the said provisions, if he proves that there was reasonable cause for the said failure.

-------------------------------------

1 . Omitted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"or 447"

S.466 Penalty for failure to comply with the provisions of section 254 

If a person fails to comply with the provisions of section 254, the Joint Commissioner, Deputy Director or Assistant Director or the Assessing Officer, may impose a penalty which may extend up to ₹ 1[25000] on him.

---------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"1000"

S.476 Failure to pay tax to credit of Central Government under Chapter XIX-B 

1 [(1) If a person fails to--

(a) pay the tax deducted at source by him to the credit of the Central Government, as required by or under the provisions of Chapter XIX-B; or

(b) pay tax or ensure payment of tax to the credit of the Central Government in respect of--

(A) any income by way of winnings from online games as referred in section 393(3) [Table: Sl. No. 2], excluding such winnings which are wholly in kind, as referred to in Note 2 to the said Table; or

(B) any sum by way of consideration for transfer of a virtual digital asset as referred in section 393(1) [Table: Sl. No. 8(vi)], excluding such consideration which is wholly in kind, as referred to in Note 6 to the said Table, he shall be punishable-

(i) with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of such tax exceeds fifty lakh rupees; or

(ii) with simple imprisonment for a term up to six months, or with fine, or with both, where

S.472 Bar of limitation for imposing penalties

(1) No order imposing a penalty under this Chapter shall be passed after the expiry of six months from the end of the quarter in which--

(a) the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed, if the relevant assessment or other order is not the subject-matter of an appeal under section 356 or 357 or 362;

(b) the order of revision is passed, if the relevant assessment or other order is the subject-matter of revision under section 377 or 378;

(c) the order of appeal is received by the jurisdictional Principal Commissioner or Commissioner, if the relevant assessment or other order is the subject-matter of an appeal under section 356 or 357 or 362;

(d) notice for imposition of penalty is issued, in any other case.

(2) The order imposing or enhancing or reducing or cancelling penalty or dropping the proceedings for the imposition of penalty may be revised on the basis of assessment as revised

S.477 Failure to pay tax collected at source 

1 [(1) If a person fails to pay the tax collected by him to the credit of the Central Government, as required under section 397(3)(a), he shall be punishable--

(a) with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of such tax exceeds fifty lakh rupees; or

(b) with simple imprisonment for a term up to six months or with fine, or with both, where the amount of such tax exceeds ten lakh rupees but does not exceed fifty lakh rupees; or

(c) with fine, in any other case.]

(2) The provisions of this section shall not apply if the payment of the tax collected at source has been made to the credit of the Central Government on or before the time prescribed for filing the statement under section 397(3)(b) in respect of such payment.

-------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"(1) If a person fails to pay the tax collected by him to

S.474 Failure to afford facility for inspection of books of account during search 

474. 1[Failure to afford facility for inspection of books of account during search]  If a person, who is required to afford the authorised officer with the necessary facility to inspect the books of account or other documents, under section 247(1)(ii), fails to do so, he shall be punishable with 2[simple imprisonment for a term up to six months, or with fine, or with both].

------------------------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"Failure to comply with section 247(1)(ii)"

2 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"rigorous imprisonment for a term which may extend to two years and shall also be liable to fine"

S.475 Removal, concealment, transfer or delivery of property to prevent tax recovery 

Whoever, fraudulently removes, conceals, transfers or delivers to any person, any property or any interest therein, with the intent to prevent such property or interest therein from being taken in execution of a certificate drawn under section 413, shall be punishable with 1[simple imprisonment for a term up to two years and with fine].

------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"rigorous imprisonment for a term which may extend to two years and shall also be liable to fine"

S.478 Wilful attempt to evade tax, etc 

1 [(1) If a person wilfully attempts in any manner to evade any tax, penalty or interest chargeable or imposable, or under-reports his income, under this Act, he shall be punishable--

(a) with simple imprisonment for a term up to two years, or with fine, or with both, where the amount sought to be evaded or tax on under-reported income exceeds fifty lakh rupees; or

(b) with simple imprisonment for a term up to six months, or with fine, or with both, where the amount sought to be evaded or tax on under-reported income exceeds ten lakh rupees but does not exceed fifty lakh rupees; or

(c) with fine, in any other case.

(2) If a person wilfully attempts in any manner to evade payment of any tax, penalty or interest under this Act, he shall be punishable--

(a) with simple imprisonment for a term up to two years, or with fine, or with both, where the amount sought to be evaded exceeds fifty lakh rupees; or

(b) with simple imprisonment for a term u

S.479 Failure to furnish returns of income 

(1) If a person wilfully fails to furnish in due time the return of income, which is required to be furnished under section 263(1), or by notice given under sections 268(1) or 280, he shall be punishable,--

1 [(a) with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of tax, which would have been evaded if the failure had not been discovered, exceeds fifty lakh rupees; or

(b) with simple imprisonment for a term up to six months, or with fine, or with both, where the amount of tax, which would have been evaded if the failure had not been discovered, exceeds ten lakh rupees but does not exceed fifty lakh rupees; or

(c) with fine, in any other case.]

(2) A person shall not be proceeded against under sub-section (1) for failure to furnish in due time the return of income under section 263(1) for any tax year, if--

(a) a return is furnished by him under section 263(4) or 263(6); or

(b) the tax payable

S.480 Failure to furnish return of income setting forth undisclosed income 

1 [ 480. Failure to furnish return of income setting forth undisclosed income If a person wilfully fails to furnish in due time the return of income, setting forth his undisclosed income for the block period, which is required to be furnished by notice given under section 294(1)(a), he shall be punishable--

(a) with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of tax exceeds fifty lakh rupees; or

(b) with simple imprisonment up to six months, or with fine, or with both, where the amount of tax exceeds ten lakh rupees but does not exceed fifty lakh rupees; or

(c) with fine, in any other case.]

-------------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"480 Failure to furnish return of income in search cases If a person wilfully fails to furnish in due time the return of total income which is required to be furnished by notice given under

S.483 Falsification of books of account or document, etc 

(1) If any person (herein referred to as the first person) willfully and with intent to enable any other person (herein referred to as the second person) to evade any tax or interest or penalty chargeable and imposable under this Act, makes or causes to be made any entry or statement which is false and which the first person either knows to be false or does not believe to be true, in any books of account or other document relevant to or useful in any proceedings against the first person or the second person, under this Act, the first person shall be punishable with 1[simple imprisonment for a term up to two years and with fine].

(2) For the purposes of establishing the charge under this section, it shall not be necessary to prove that the second person has actually evaded any tax, penalty or interest chargeable or imposable under this Act.

--------------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

S.473 Contravention of order made during search action 

473. 1[Contravention of order made during search action]  Whoever contravenes any order referred to in section 247(4) shall be punishable with 2[simple imprisonment up to two years and with fine].

------------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"Contravention of order made under section 247"

2 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"rigorous imprisonment which may extend to two years and shall also be liable to fine"

S.487 Offences by companies

(1) If an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company as well as the company shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

(2) The provisions of sub-section (1) shall not apply if the person referred therein proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.

(3) Irrespective of anything contained in sub-section (1) and (2), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shal

S.484 Abetment of false return, etc 

If a person abets or induces in any manner another person--

(a) to make and deliver an account or a statement or declaration relating to any income chargeable to tax which is false and which he either knows to be false or does not believe to be true; or

(b) to commit an offence under section 478(1), 1 [he shall be punishable--

(i) with simple imprisonment for a term up to two years, or with fine, or with both, where the amount of tax, penalty or interest which would have been evaded, if the declaration, account or statement had been accepted as true, or which is wilfully attempted to be evaded, exceeds fifty lakh rupees; or

(ii) with simple imprisonment for a term up to six months, or with fine, or with both, where the amount of tax, penalty or interest which would have been evaded, if the declaration, account or statement had been accepted as true, or which is wilfully attempted to be evaded, exceeds ten lakh rupees but does not exceed fifty lakh rupees

S.488 Offences by Hindu undivided family 

(1) Where an offence under this Act has been committed by a Hindu undivided family, the karta thereof shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

(2) Nothing contained in sub-section (1) shall render the karta liable to any punishment, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.

(3) Irrespective of anything contained in sub-section (1) and (2), where an offence under this Act, has been committed by a Hindu undivided family and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any member of the Hindu undivided family, such member shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

S.485 Punishment for second and subsequent offences 

If any person convicted of an offence under sections 476, 477, 478(1), 479, 480, 482 or 484 is again convicted of an offence under any of the said sections, he shall be punishable for the second and for every subsequent offence with 1[simple imprisonment for a term which shall not be less than six months but which may extend to three years and with fine].

---------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years, and with fine"

S.481 Failure to comply with a direction of special audit or valuation 

1 [ 481. Failure to comply with a direction of special audit or valuation.-

If a person wilfully fails to comply with a direction issued to him under section 268 (5), he shall be punishable with simple imprisonment for a term up to six months, or with fine, or with both.]

----------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

S.501 Service of notice, generally 

(1) The service of a notice, or summon, or requisition, or order, or any other communication, under this Act (herein referred to as communication) may be made by delivering or transmitting a copy thereof, to the person therein named--

(a) by post or by such courier services as may be approved by the Board;

(b) in such manner as provided under the Code of Civil Procedure, 1908 (5 of 1908) for the purposes of service of summons;

(c) in the form of any electronic record as provided in Chapter IV of the Information Technology Act, 2000 (21 of 2000); or

(d) by any other means of transmission of documents, as may be prescribed.

(2) The Board may make rules providing for the addresses (including the address for electronic mail or electronic mail message) to which the communication referred to in sub-section (1) may be delivered or transmitted to the person therein named.

(3) For the purposes of this section, "electronic mail" and "electronic mail

S.503 Service of notice when family is disrupted or firm etc., is dissolved

(1) After a finding of total partition has been recorded by the Assessing Officer under section 315 for any Hindu family, notices under this Act in respect of the income of the Hindu family shall be served on the person, who was its last manager, or, if such person is dead, then on all adults who were members of the Hindu family immediately before the partition.

(2) Where a firm or other association of persons is dissolved, notices under this Act for the income of such firm or association may be served on any person, who was a partner (not being a minor) or member of the association, immediately before its dissolution.

S.502 Authentication of notices and other documents 

(1) Where this Act requires a notice or other document to be issued by any income-tax authority, such notice or other document shall be signed and issued in paper form or communicated in electronic form by that authority as per such procedure, as may be prescribed.

(2) Every notice or other document to be issued, served or given under this Act by any income-tax authority, shall be deemed to be authenticated, if the name and office of a designated income-tax authority is printed, stamped or otherwise written thereon.

(3) For the purposes of this section, the expression "designated income-tax authority" means any income-tax authority authorised by the Board to issue, serve or give such notice or other document after authentication in the manner as provided in sub-section (2).

S.504 Service of notice in case of discontinued business 

Where an assessment is to be made under section 320, the Assessing Officer may serve on the--

(a) person whose income is to be assessed; or

(b) person who was a member of a firm or association of persons at the time of its discontinuance, in the case of a firm or an association of persons; or

(c) principal officer, in the case of a company, a notice containing all or any of the requirements which may be included in a notice under section 268(1) and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that section.

S.491 Prosecution to be at instance of Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner 

(1) A person shall not be proceeded against for an offence under section 473, 474, 475, 476, 477, 478, 479, 480, 481, 482, 483 or 484 except with the previous sanction of the Principal Commissioner or Commissioner or Commissioner (Appeals) or Joint Commissioner (Appeals).

(2) The Principal Chief Commissioner or Chief Commissioner or Principal Director General or Director General may issue such instructions or directions to the income-tax authorities mentioned in sub-section (1) as he may deem fit for institution of proceedings under that sub-section.

(3) A person shall not be proceeded against for an offence under section 478 or 482 in relation to the assessment for a tax year in respect of which the penalty imposed or imposable on him under section 439 has been reduced or waived by an order under section 469.

(4) Any offence under this Chapter may be compounded, either before or after the institution of proceedings, by the Principal Chief Commissioner or Chief

S.489 Presumption as to assets, books of account, etc., in certain cases 

(1) Where during the course of any search made under section 247, any money, bullion, jewellery, virtual digit asset or other valuable article or thing (hereinafter referred to as the assets) or any books of account or other documents or any information in electronic form as defined in section 261(g) or on a computer system as defined in section 261(e) or any computer system containing the said information, has or have been found in the possession or control of any person and such assets or books of account or other documents or such information are tendered by the prosecution in evidence against such person, or against such person and the person referred to in section 484, for an offence under this Act, the provisions of section 247(7) shall, so far as may be, apply in relation to such assets or books of account or other documents or such information.

(2) Where any assets or books of account or other documents any information in electronic form or on a computer system or an

S.490 Presumption as to culpable mental state 

(1) In any prosecution for any offence under this Act, which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the Act charged as an offence in that prosecution.

(2) For the purposes of this section, the expression "culpable mental state" includes intention, motive or knowledge of a fact or belief in, or reason to believe, a fact.

(3) For the purposes of this section, a fact is said to be proved only when the court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderance of probability.

S.493 Proof of entries in records or documents 

Entries in the records or other documents in the custody of an income-tax authority shall be admitted in evidence in any proceedings for the prosecution of any person for an offence under this Chapter, and all such entries may be proved either by--

(a) the production of the records or other documents in the custody of the income-tax authority containing such entries; or

(b) the production of a copy of the entries certified by the income-tax authority having custody of the records or other documents under its signature and stating that it is a true copy of the original entries and that such original entries are contained in the records or other documents in its custody.

S.494 Disclosure of particulars by public servants

(1) A public servant, who furnishes any information or produces any document in contravention of the provisions of section 258(3), shall be punishable with 1[simple imprisonment up to one month, or with fine, or with both].

(2) No prosecution shall be instituted under this section except with the previous sanction of the Central Government.

-------------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"imprisonment which may extend to six months, and shall also be liable to fine"

S.486 Punishment not to be imposed in certain cases

No person shall be punishable for any failure referred to in section 476 or 477, irrespective of anything contained in that section, if he proves that there was reasonable cause for such failure.

S.492 Certain offences to be non-cognizable 

Irrespective of anything contained in the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), an offence punishable under section 476, 478, 479, 480, 482 or 484 shall be deemed to be non-cognizable within the meaning of that Sanhita.

S.500 Provisional attachment to protect revenue in certain cases 

(1) Where, during the pendency of any proceeding for--

(a) the assessment of any income or for the assessment or reassessment of any income, which has escaped assessment; or

(b) imposition of penalty under section 444, where the amount or aggregate of amounts of penalty likely to be imposed under the said section exceeds two crore rupees, the Assessing Officer is of the opinion that for protecting the interests of the revenue it is necessary so to do, he may, with the previous approval of the Competent Authority by order in writing, attach provisionally any property belonging to the assessee in the manner prescribed in section 413.

(2) Every provisional attachment under sub-section (1) shall cease to have effect after the expiry of six months from the date of the order made under the said sub-section.

(3) The Competent Authority may, for reasons to be recorded in writing, extend the period referred to in sub-section (2) and the total period of such exten

S.499 Certain transfers to be void

(1) Where, during the pendency of any proceeding under this Act or after the completion thereof, but before the service of notice by the Tax Recovery Officer as per the procedure specified under section 413, any assessee creates a charge on, or parts with the possession of, any of his assets in favour of any other person, such charge or transfer shall be void as against any claim in respect of any tax or any other sum payable by the assessee as a result of the completion of the said proceeding or otherwise.

(2) The charge or transfer as referred to in sub-section (1) shall not be void if it is made--

(a) for adequate consideration and without notice of the pendency of such proceeding or, as the case may be, without notice of such tax or other sum payable by the assessee; or

(b) with the previous permission of the Assessing Officer.

(3) This section applies to cases where the amount of tax or other sum payable or likely to be payable exceeds ₹5000 and the

S.498 Application of Bharatiya Nagarik Suraksha Sanhita, 2023 to proceedings before Special Court 

(1) Save as otherwise provided in this Act, the provisions of Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023) (including the provisions as to bails or bonds), shall apply to the proceedings before a Special Court and the person conducting the prosecution before the Special Court, shall be deemed to be a Public Prosecutor.

(2) The Central Government may also appoint a Special Public Prosecutor for any case or class or group of cases.

(3) A person shall not be qualified to be appointed as a Public Prosecutor or a Special Public Prosecutor under this section unless he has been in practice as an advocate for not less than seven years, requiring special knowledge of law.

(4) Every person appointed as a Public Prosecutor or a Special Public Prosecutor under this section shall be deemed to be a Public Prosecutor within the meaning of section 2(1)(v) of the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), and the provisions of that Sanhita shall have effect

S.496 Offences triable by Special Court 

(1) Irrespective of anything contained in the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023),--

(a) the offences punishable under this Chapter shall be triable only by the Special Court , if so designated, for the area or areas or for cases or class or group of cases, as the case may be, in which the offence has been committed;

(b) a Special Court may, upon a complaint made by an authority authorised in this behalf under this Act, take cognizance of the offence for which the accused is committed for trial.

(2) For the purposes of sub-section (1)(a), the court competent to try offences under section 520,--

(a) which has been designated as a Special Court under this section, shall continue to try the offences before it or offences arising under this Act after such designation;

(b) which has not been designated as a Special Court , may continue to try such offence pending before it till its disposal.

S.497 Trial of offences as summons case 

The Special Court, irrespective of anything contained in the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), shall try an offence under this Chapter punishable with imprisonment not exceeding two years or with fine, or with both, as a summons case, and the provisions of the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023) as applicable in the case of trial of summons case, shall apply accordingly.

S.505 Submission of statement by a non-resident having liaison office

Every person, being a non-resident, having a liaison office in India set up as per the guidelines issued by the Reserve Bank of India under the Foreign Exchange Management Act, 1999 (42 of 1999), shall, in respect of its activities in a tax year, prepare and deliver to the Assessing Officer having jurisdiction, a statement, in such form and containing such particulars within such period, as may be prescribed.

S.508 Obligation to furnish statement of financial transaction or reportable account 

(1) Any person, being--

(a) an assessee; or

(b) the prescribed person, in the case of an office of Government; or

(c) a local authority or other public body or association; or

(d) the Registrar or Sub-Registrar appointed under section 6 of the Registration Act, 1908 (16 of 1908) ; or

(e) the registering authority empowered to register motor vehicles under Chapter IV of the Motor Vehicles Act, 1988 (59 of 1988); or

(f) the Director General as referred to in section 2(a) of the Post Office Act, 2023 (43 of 2023); or

(g) the Collector referred to in section 3(g) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (30 of 2013); or

(h) the recognised stock exchange referred to in section 2(f) of the Securities Contracts (Regulation) Act, 1956 (42 of 1956); or

(i) an officer of the Reserve Bank of India , constituted under section 3 of the Reserve Bank of India Act

S.509 Obligation to furnish information on transaction of crypto-asset 

(1) Any person, being a reporting entity, as may be prescribed, in respect of a crypto-asset, shall furnish information in respect of a transaction of such crypto-asset in a statement, for such period, within such time, in such form and manner and to such income-tax authority, as may be prescribed.

(2) Where the prescribed income-tax authority considers that the statement furnished under sub-section (1) is defective, he may intimate the defect to the person who has furnished such statement and give him an opportunity of rectifying the defect within thirty days from the date of such intimation or such further period as may be allowed, and if the defect is not rectified within such period, the provisions of this Act shall apply as if such person had furnished inaccurate information in the statement.

(3) Where a person who is required to furnish a statement under sub-section (1) has not furnished the same within the specified time, the prescribed income-tax authority may

S.507 Submission of statements by producers of cinematograph films or persons engaged in specified activity 

(1) Any person carrying on the production of a cinematograph film or engaged in any specified activity, or both, during the whole or any part of any tax year shall, furnish within such period, a statement in such form and in such manner, to the prescribed income-tax authority as may be prescribed.

(2) The statement referred in sub-section (1) shall contain particulars of all payments of over ₹50000 in the aggregate made by him or due from him to each such person as is engaged by him in such production or specified activity.

(3) For the purposes of this section, the expression "specified activity" means any event management, documentary production, production of programmes for telecasting on television or over the top platforms or any other similar platform, sports event management, other performing arts or any other activity as the Central Government may, by notification, specify.

S.506 Furnishing of information or documents by an Indian concern in certain cases 

Where,--

(a) any share of, or interest in, a company or an entity registered or incorporated outside India derives, directly or indirectly, its value substantially from the assets located in India, as referred to in section 9(10)(a); and (b) such company or entity, as the case may be, holds, directly or indirectly, such assets in India through, or in, an Indian concern, then, such Indian concern shall, for the purposes of determination of any income accruing or arising in India under the said section, furnish within prescribed period to the prescribed income-tax authority the information or documents in such manner, as may be prescribed.

S.511 Furnishing of report in respect of international group

(1) Every constituent entity resident in India, shall, if it is constituent of an international group, the parent entity of which is not resident in India, notify the prescribed income-tax authority in the form and manner, on or before such date, as may be prescribed,--

(a) whether it is the alternate reporting entity of the international group; or

(b) the details of the parent entity or the alternate reporting entity, if any, of the international group, and the country or territory of which the said entities are resident.

(2) Every parent entity or the alternate reporting entity, resident in India , shall, for every reporting accounting year, in respect of the international group of which it is a constituent, furnish a report, to the prescribed income-tax authority within twelve months from the end of the said reporting accounting year, in such form and manner, as may be prescribed.

(3) In sub-sections (2) and (4), the report in respect of an internatio

S.515 Appearance by authorized representative 

(1) An assessee, entitled or required to attend before any income-tax authority or the Appellate Tribunal for any proceeding under this Act, may attend through an authorised representative.

(2) The provisions of sub-section (1) shall not apply where an assessee is required to attend personally for examination on oath or affirmation under section 246.

(3) For the purposes of this section,--

(a) "authorised representative" means a person authorised by the assessee, in writing, to appear on his behalf, being--

(i) a person related to or regularly employed by the assessee in any manner; or

(ii) any officer of a scheduled bank with which the assessee maintains a current account or has other regular dealings; or

(iii) any legal practitioner, who is entitled to practise in any civil court in India ; or

(iv) an accountant; or

(v) any person, who has passed any accountancy examination recognised by the Board; or

(vi) any person,

S.512 Publication of information respecting assessees in certain cases 

(1) If the Central Government is of the opinion that it is necessary or expedient in the public interest to publish the names of any assessees and any other particulars relating to any proceedings or prosecutions under this Act in respect of such assessees, it may publish such names and particulars in such manner as it thinks fit.

(2) No publication under this section shall be made for any penalty imposed under this Act, until the time for filing an appeal under section 356 or 357 has expired and no appeal has been filed, or if an appeal is filed, it has been disposed of.

(3) The names of the partners of the firm, directors, managing agents, secretaries and treasurers, or managers of the company, or the members of the association, as the case may be, may also be published under sub-section (1), if, in the opinion of the Central Government, the circumstances of the case justify it.

S.514 Registration of valuers 

(1) The Principal Chief Commissioner or Chief Commissioner, or the Principal Director General or Director General, shall maintain a register of valuers in which the names and addresses of persons registered under sub-section (2) shall be entered.

(2) Any person, possessing such qualification for valuing such class of assets, as may be prescribed, may apply to the Principal Chief Commissioner or Chief Commissioner, or the Principal Director General or Director General, for getting registered as a valuer, in such form, verified in such manner and accompanied by such fee, as may be prescribed, along with a declaration stating that the applicant will--

(a) conduct an impartial and true valuation of any asset required to be valued;

(b) furnish a valuation report in the prescribed form;

(c) charge fees not exceeding the prescribed rate or rates; and (d) refrain from undertaking the valuation of any asset in which such person has a direct or indirect interest.<

S.513 Appearance by registered valuer in certain matters 

(1) Any assessee, entitled or required to attend before any income-tax authority or the Appellate Tribunal in matters relating to the valuation of any asset, may attend through a registered valuer.

(2) The provisions of sub-section (1) shall not apply, where the assessee is required to attend personally for examination on oath or affirmation under section 246.

(3) For the purposes of this section, the expression "registered valuer" means a person registered as a valuer under section 514.

S.522 Circumstances in which return of income, assessment, approvals, etc., not to be invalid 

1 [ 522. Circumstances in which return of income, assessment, approvals, etc., not to be invalid (1) No return of income, assessment, notice, summons or other proceedings relating thereto, furnished or made or issued or taken, or purported to have been furnished or made or issued or taken, in pursuance of any of the provisions of this Act, shall be invalid or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such return of income, assessment, notice, summons or other proceeding, if such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purposes of this Act.

(2) No assessment under any of the provisions of this Act shall be invalid on the ground of any mistake, defect or omission in respect of quoting of a computer generated Document Identification Number, if the assessment order is referenced by such number in any manner.

(3) Irrespective of

S.519 Power to tender immunity from prosecution 

(1) The Central Government may, if it is of the opinion that with a view to obtaining the evidence of any person appearing to have been directly or indirectly concerned in or privy to the concealment of income or to the evasion of payment of tax on income it is necessary or expedient so to do, for reasons to be recorded in writing, tender to such person,--

(a) immunity from prosecution for any offence under this Act or under the Bharatiya Nyaya Sanhita, 2023 (45 of 2023), or under any other Central Act in force; and (b) from imposition of any penalty under this Act on condition of his making a full and true disclosure of the whole circumstances relating to the concealment of income or evasion of payment of tax on income.

(2) A tender of immunity made to, and accepted by, the person concerned, shall, to the extent to which the immunity extends, render him immune from prosecution for any offence in respect of which the tender was made, or from the imposition of any pena

S.516 Rounding off of amount of total income, or amount payable or refundable 

The amount of total income computed or any amount payable or refundable under this Act, shall be rounded off to the nearest multiple of ₹10 ignoring any part of a rupee consisting of paise and thereafter if such amount is not a multiple of ten, then--

(a) such amount shall be increased to the next higher amount which is a multiple of ten, if the last figure in that amount is five or more; or

(b) such amount shall be reduced to the next lower amount which is a multiple of ten, if the last figure is less than five, and the amount so rounded off shall be deemed to be the total income of the assessee or the amount payable or refundable, as the case may be, under this Act.

S.523 Notice deemed to be valid in certain circumstances 

(1) Where an assessee has appeared in any proceeding or co-operated in any inquiry relating to an assessment or reassessment, it shall be deemed that any notice under this Act, which is required to be served upon him, has been duly served upon him in time as per the provisions of this Act and such assessee shall be precluded from taking any objection in any proceeding or inquiry under this Act that the notice was--

(a) not served upon him; or

(b) not served upon him in time; or

(c) served upon him in an improper manner.

(2) The provisions of sub-section (1) shall not apply where the assessee has raised such objection before the completion of such assessment or reassessment.

S.521 Probation of Offenders Act, 1958 and section 401 of Bharatiya Nagarik Suraksha Sanhita, 2023, not to apply 

The provisions of the Probation of Offenders Act, 1958 (20 of 1958) and section 401 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023) shall not apply to a person convicted of an offence under this Act unless that person is under eighteen years of age.

S.510 Annual information statement

(1) The prescribed income-tax authority or the person authorised by such authority, shall upload in the registered account of the assessee an annual information statement in such form and manner, within such time and along with such information, which is in the possession of an income-tax authority, as may be prescribed.

(2) In sub-section (1), "registered account" means the electronic filing account registered by the assessee in the web portal, as may be designated by the prescribed income-tax authority or the person authorised by such authority.

S.518 Indemnity 

Every person deducting, retaining, or paying any tax in pursuance of this Act in respect of an income belonging to another person shall be indemnified for the deduction, retention, or payment thereof.

S.520 Cognizance of offences 

No court inferior to that of a Judicial Magistrate of the first class shall try any offence under this Act.

S.517 Receipt to be given. 

A receipt shall be given for any money paid or recovered under this Act.

S.524 Presumption as to assets, books of account, etc 

(1) Where any books of account, other documents, money, bullion, jewellery, virtual digital asset or other valuable article or thing or any information in electronic form as defined in section 261(g) or on a computer system as defined in section 261(e) or any computer system containing the said information, is found in the possession or control of any person in the course of a search under section 247 or survey under section 253, it may, in any proceeding under this Act, be presumed--

(a) that such books of account, other documents, money, bullion, jewellery, virtual digital asset or other valuable article or thing such information or computer system belong or belongs to such person;

(b) that the contents of such books of account and other documents or such information or computer system are true;

(c) that the signature and every other part of such books of account and other documents, which purports to be in the handwriting of any particular person, or which m

S.532 Power to frame schemes

(1) The Central Government may, by notification, make a scheme for any of the purposes of this Act, so as to impart greater efficiency, transparency and accountability by--

(a) eliminating the interface with the assessee or any other person to the extent technologically feasible;

(b) optimising utilisation of the resources through economies of scale and functional specialisation.

(2) The Central Government may, for the purposes of giving effect to the scheme made under sub-section (1), by notification, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as specified in the notification.

(3) Where a scheme has been notified under the provisions of the Income-tax Act, 1961 (43 of 1961) with a view to eliminating the interface with the assessee or any other person, the Central Government may, by notification, amend or modify the said scheme as per the provisions of sub-section (1),

S.531 Power to rescind exemption in relation to certain Union territories already granted under section 294A of the Income-tax Act, 1961 

Where the Central Government considers it necessary or expedient so to do may, by general or special order, rescind an exemption, reduction in rate or other modification in respect of income-tax or super-tax in favour of any assessee or class of assessees or in regard to the whole or any part of the income of any assessee or class of assessees, made as per the provisions of section 294A of the Income-tax Act, 1961 (43 of 1961).

S.525 Authorisation and assessment in case of search or requisition 

(1) Irrespective of anything contained in this Act,--

(a) it shall not be necessary to issue an authorisation under section 247 or make a requisition under section 248 separately in the name of each person;

(b) where an authorisation under section 247 has been issued or requisition under section 248 has been made mentioning therein the name of more than one person, the mention of such names of more than one person on such authorisation or requisition shall not be deemed to construe that it was issued in the name of an association of persons or body of individuals consisting of such persons.

(2) Irrespective of an authorisation issued under section 247 or a requisition made under section 248 mentioning therein the name of more than one person, the assessment or reassessment shall be made separately in the name of each of the persons mentioned in such authorisation or requisition.

S.530 Act to have effect pending legislative provision for charge of tax 

If on the 1st April in any tax year, provision has not yet been made by a Central Act for the charging of income-tax for that tax year, this Act shall nevertheless have effect until such provision is so made, as if the provision in force in the preceding tax year or the provision proposed in the Bill then before Parliament, whichever is more favourable to the assessee, were actually in force.

S.528 Power of Central Government or Board to condone delays in obtaining approval 

Where, the approval of the Central Government or the Board is required to be obtained before a specified date under this Act, it shall be open to the Central Government or the Board to condone, for sufficient cause, any delay in obtaining such approval.

S.529 Power to withdraw approval 

Where the Central Government or the Board or an income-tax authority, has the power to grant any approval under any provision of this Act to any assessee, the Central Government or the Board or such income-tax authority may, withdraw such approval at any time after recording the reasons therefor, even if such provision does not specifically allow for its withdrawal, after giving such assessee a reasonable opportunity of being heard.

S.533 Power to make rules 

(1) The Board may, subject to the control of the Central Government, by notification, make rules for carrying out the purposes of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters:--

(a) the ascertainment and determination of any class of income;

(b) the manner in which and the procedure by which the income shall be arrived at in the case of--

(i) income derived in part from agriculture and in part from business;

(ii) persons residing outside India ;

(iii) operations carried out in India by a non-resident;

(iv) transactions or activities of a non-resident;

(v) an individual who is liable to be assessed under section 99(3) and (4);

(c) the determination of the value of any perquisite chargeable to tax under this Act in such manner and on such basis as appears to the Board to be proper and reasonable;

(d) the p

S.534 Laying before Parliament 

The Central Government shall cause--

(a) every rule made under this Act;

(b) rules of procedure framed by the Appellate Tribunal under section 364; or

(c) every notification issued under sections 263(3) and 264 and Chapter XIII-G, to be laid, as soon as may be after it is made or issued, before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in such rule, or notification or both Houses agree that the rule, should not be made or the notification should not be issued, the rule or notification shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previo

S.535 Removal of difficulties

(1) If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by general or special order, do anything not inconsistent with such provisions which appears to it to be necessary or expedient for the purpose of removing the difficulty.

(2) In particular, and without prejudice to the generality of the foregoing power, any order referred to in sub-section (1) may provide for the adaptations or modifications subject to which the Income-tax Act, 1961 (43 of 1961) shall apply in relation to the assessments for the tax year ending on the 31st March, 2026, or any earlier tax year.

(3) No order under sub-section (1) shall be made after the expiration of three years from the 1st April, 2026 .

(4) Every order made under this section shall be laid, as soon as may be, after it is made, before each House of Parliament.

S.495 Special Courts

(1) The Central Government, in consultation with the Chief Justice of the High Court, may, for trial of offences punishable under this Chapter, by notification, designate one or more courts of Judicial Magistrate of the first class as Special Court for such area or areas, or for such cases or class or group of cases, as specified in the notification.

(2) For the purposes of this section, the expression "High Court" means the High Court of the State in which a Judicial Magistrate of first class designated as Special Court was functioning immediately before such designation.

(3) While trying an offence under this Act, a Special Court shall also try an offence, other than an offence referred to in sub-section (1), with which the accused may, under the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), be charged at the same trial.

S.253 Powers of survey

Irrespective of anything contained in any other provision of this Act, an income-tax authority may enter any place at which a business or profession, or activity for charitable purpose is carried on, whether such place be the principal place or not of such business or profession or of such activity for charitable purpose, where such place--

(a) is within the limits of the area assigned to such authority; or

(b) is occupied by any person in respect of whom such authority exercises jurisdiction; or

(c) in respect of which such authority is authorised for the purposes of this section by income-tax authority, who is assigned the area within which such place is situated or who exercises jurisdiction in respect of any person occupying such place, and, upon entry into such a place, may require any proprietor, trustee, employee or any other person who may at that time and place be attending in any manner to, or helping in, the carrying on of such business or pr

S.461 Penalty for failure to furnish statements, etc

(1) Where a person, who is required to deliver or causes to be delivered a statement prescribed in section 397(3)(b),--

(a) fails to do so within the time prescribed in the said section; or

(b) furnishes incorrect information in the said statement, the Assessing Officer may impose on such person, a penalty of a sum which shall not be less than ₹10000 but which may extend to ₹100000.

(2) No penalty shall be levied under sub-section (1)(a) for delay in filing or non-filing of statement referred therein, if the person proves that--

(a) tax deducted or collected along with the fee and interest, if any, was paid to the credit of the Central Government; and (b) the said statement was also delivered or cause to be delivered before the expiry of one month from the time prescribed in section 397(3)(b).

S.134 Deductions in respect of rents paid

(1) In computing the total income of an assessee, subject to other provisions of this section, there shall be deducted any expenditure incurred by him towards payment of rent (by whatever name called) in respect of any furnished or unfurnished accommodation occupied by him for the purposes of his own residence.

(2) The deduction under sub-section (1) shall be allowable on payment of such rent exceeding 10% of his total income, subject to a maximum of ₹ 5000 per month, or 25% of total income for tax year, whichever is less.

(3) For the purposes of deduction under sub-section (1), such other conditions or limitations having regard to the area or place in which such accommodation is situated and other relevant consideration, as may be prescribed, shall be taken into account.

(4) No deduction under this section shall be allowed to an assessee in any case, where--

(a) any residential accommodation is--

(i) owned by the assessee or by his spouse or mino

S.132 Deduction in respect of purchase of electric vehicle

(1) An assessee, being an individual, shall be allowed a deduction of interest payable on loan taken by him from any financial institution for the purpose of purchase of an electric vehicle, as per the provisions of this section.

(2) The deduction under sub-section (1) shall be subject to the condition that the loan has been sanctioned by the financial institution during the period beginning on the 1st April, 2019 and ending on the 31st March, 2023.

(3) The deduction under sub-section (1) shall not exceed ₹ 150000 and shall be allowed in computing the total income of the individual for the tax year beginning on the 1st April, 2019 and subsequent tax years.

(4) Where a deduction under this section is allowed for any interest referred to in sub-section (1), deduction shall not be allowed in respect of such interest under any other provision of this Act for the same or any other tax year.

(5) For the purposes of this section,--

(a) "electric vehicle"

S..138 Deductions in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development, etc 

In respect of any tax year, where--

(a) the gross total income of an assessee includes any profits and gains derived by an undertaking or an enterprise from any business referred to in section 80-IA of the Income-tax Act, 1961 (43 of 1961); and (b) such assessee is eligible to claim a deduction from the profits and gains derived from such business for such tax year under the provisions of the said section, as if the said Act had not been repealed, there shall be allowed, in computing the total income of the assessee, a deduction from the profits and gains derived from such business, subject to the conditions that--

(i) the amount of deduction is calculated as per the provisions of section 80-IA of the Income-tax Act, 1961 (43 of 1961); and (ii) the deduction under this Act shall be allowed only for such tax years, as would have been allowed under section 80-IA of the Income-tax Act, 1961 (43 of 1961), as if the said Act had not been repealed.

S.136 Deduction in respect of contributions given by companies to political parties

(1) An assessee, being an Indian company, shall be allowed a deduction for the amount contributed by it, other than by way of cash, during a tax year to a political party registered under section 29A of the Representation of the People Act, 1951 (43 of 1951) or an electoral trust.

(2) For the purposes of this section, the term "contribute", with its grammatical variations and cognate expressions shall have the same meaning as assigned to it in section 182 of the Companies Act, 2013 (18 of 2013).

S.137 Deduction in respect of contributions given by any person to political parties 

An assessee, (other than a local authority and an artificial juridical person wholly or partly funded by the Government), shall be allowed a deduction for the amount contributed by him, other than by way of cash, during a tax year to a political party registered under section 29A of the Representation of the People Act, 1951 (43 of 1951), or an electoral trust.S.135

S.140 Special provision in respect of specified business

(1) Where the gross total income of an assessee, being an eligible start-up, includes any profits and gains derived from eligible business, there shall, as per and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction of an amount equal to 100% of the profits and gains derived from such business for three consecutive tax years.

(2) The deduction specified in sub-section (1) may, at the option of the assessee, be claimed by him for any three consecutive tax years out of ten years beginning from the year in which the eligible start-up is incorporated.

(3) This section applies to a start-up which fulfils the following conditions:--

(a) it is not formed by splitting up, or the reconstruction, of a business already in existence;

(b) it is not formed by the transfer to a new business of machinery or plant previously used for any purpose.

(4) Where the business of any undertaking carried on in I

S.143 Special provisions in respect of certain undertakings in North-Eastern States 

(1) Where the gross total income of an assessee includes any profits and gains derived by an undertaking, to which this section applies, from any business referred to in sub-section (2), there shall be allowed, in computing the total income of the assessee, a deduction of an amount equal to 100% of the profits and gains derived from such business for ten consecutive tax years commencing with the initial tax year.

(2) This section applies to any undertaking which during the period beginning on the 1st April, 2007 and ending before the 1st April, 2017, has begun or begins, in any of the North-Eastern States,--

(a) to manufacture or produce any eligible article or thing; or

(b) to undertake substantial expansion to manufacture or produce any eligible article or thing; or

(c) to carry on any eligible business.

(3) This section applies to any undertaking which fulfils all the following conditions:--

(a) it is not formed by splitting up, or the r

S.139 Deductions in respect of profits and gains by an undertaking or enterprise engaged in development of Special Economic Zone 

In respect of any tax year, where--

(a) the gross total income of an assessee, being a Developer, includes any profits and gains derived by an undertaking or an enterprise from any business of developing a Special Economic Zone, notified on or after the 1st April, 2005 under the Special Economic Zones Act, 2005 (28 of 2005) referred to in section 80-IAB of the Income-tax Act, 1961 (43 of 1961); and (b) such assessee is eligible to claim a deduction from the profits and gains derived from such business for such tax year under the provisions of the said section, as if the said Act had not been repealed, there shall be allowed, in computing the total income of the assessee, a deduction from the profits and gains derived from such business, subject to the conditions that--

(i) the amount of deduction is calculated as per the provisions of section 80-IAB of the Income-tax Act, 1961 (43 of 1961); and (ii) the deduction under this Act shall be allowed only for such tax years

S.144 Special provisions in respect of newly established Units in Special Economic Zones 

In respect of any tax year, where--

(a) in computing the total income of an assessee, being an entrepreneur as referred to in section 2(j) of the Special Economic Zones Act, 2005 (28 of 2005), who begins to manufacture or produce articles or things or provide any services, as referred to in section 10AA of the Income-tax Act, 1961 (43 of 1961); and (b) such assessee is eligible to claim a deduction from the profits and gains derived from the export, of such articles or things or from services for such tax year under the provisions of the said section, if the said Act had not been repealed, there shall be allowed, in computing the total income of the assessee, a deduction from the profits and gains derived from such business, subject to the conditions that--

(i) the amount of deduction is calculated as per the provisions of section 10AA of the Income-tax Act, 1961 (43 of 1961); and (ii) the deduction under this Act shall be allowed only for such tax years, as would hav

S.141 Deduction in respect of profits and gains from certain industrial undertakings 

In respect of any tax year, where--

(a) the gross total income of an assessee, includes any profits and gains derived from any business referred to in section 80-IB of the Income-tax Act, 1961 (43 of 1961); and (b) such assessee is eligible to claim a deduction from the profits and gains derived from such business for such tax year under the provisions of the said section, as if the said Act had not been repealed, there shall be allowed, in computing the total income of the assessee, a deduction from the profits and gains derived from such business, subject to the conditions that--

(i) the amount of deduction is calculated as per the provisions of section 80-IB of the Income-tax Act, 1961 (43 of 1961); and (ii) the deduction under this Act shall be allowed only for such tax years, as would have been allowed under section 80-IB of the Income-tax Act, 1961 (43 of 1961), as if the said Act had not been repealed.

S.145 Deduction for businesses engaged in collecting and processing of bio-degradable waste

If the gross total income of an assessee includes any profits and gains derived from the business of collecting and processing or treating of bio-degradable waste for,--

(a) generating power; or

(b) producing bio-fertilizers, bio-pesticides or other biological agents; or

(c) producing bio-gas; or

(d) making pellets or briquettes for fuel or organic manure, there shall be allowed a deduction equal to the whole amount of such profits and gains for five consecutive tax years, beginning with the tax year in which such business commences.

S.149 Deduction in respect of income of co-operative societies

(1) If the gross total income of an assessee, being a co-operative society, includes any income referred to in sub-section (2), the sums specified in the said sub-section shall, in accordance with and subject to the provisions of this section, be allowed as deduction in computing the total income of such assessee.

(2) The sums referred to in sub-section (1) shall be the following:--

(a) in the case of a co-operative society engaged in,--

(i) carrying on the business of banking or providing credit facilities to its members; or

(ii) a cottage industry; or

(iii) the marketing of agricultural produce grown by its members; or

(iv) the purchase of agricultural implements, seeds, livestock or other articles intended for agriculture for the purpose of supplying them to its members; or

(v) the processing, without the aid of power, of the agricultural produce of its members; or

(vi) the collective disposal of the labour of its members;

S.147 Deductions for income of Offshore Banking Units and Units of International Financial Services Centre 

(1) Where the following assessee has any income of the nature referred to in sub-section (3), there shall be allowed a deduction equal to 100% of such income:--

(a) a scheduled bank, or a bank incorporated under the laws of a country outside India, and having an Offshore Banking Unit in a Special Economic Zone; or

(b) a unit of an International Financial Services Centre.

1 [(2) Irrespective of anything contained in section 80LA of the Income-tax Act, 1961 (43 of 1961), the deduction shall be allowed,--

(a) for an entity mentioned in sub-section (1)(a), --

(i) for twenty consecutive tax years beginning from the relevant tax year; and (ii) in a case, where the tenth year, out of the period of ten consecutive years of deduction allowed under section 80LA(1) of the said Act has ended on the 31st March, 2025, for further ten consecutive years from the tax year beginning on the 1st April, 2026; and (b) in the case of an entity mentioned in sub-section (

S.146 Deduction in respect of additional employee cost

(1) Subject to the conditions specified in sub-sections (2) and (3), if the gross total income of an assessee, to whom section 63 applies, includes any profits and gains derived from business, a deduction of an amount equal to 30% of additional employee cost incurred in the course of such business in the tax year shall be allowed.

(2) The deduction referred to in sub-section (1) shall be allowed for three consecutive tax years, beginning from the tax year in which the employment is provided.

(3) The deduction under sub-section (1) shall not be allowed, if--

(a) the business is formed by splitting up, or the reconstruction, of an existing business; or

(b) the business is acquired by the assessee through transfer from any other person or as a result of any business reorganisation; or

(c) the assessee does not furnish the report of an accountant, before the specified date as referred to in section 63, giving the particulars in the report, as may be p

S.150 Deduction in respect of income of federal co-operative

1 [ 150. Deduction in respect of income of federal co-operative (1) If the gross total income of an assessee being a federal co-operative, in any tax year, includes any income by way of dividends received from its investment with any company, a deduction shall be allowed from such income, to the extent of the amount which,--

(a) has arisen from such investment as recorded in its books of account on or before the 31st January, 2026; and (b) has been distributed by it to its members at least one month before the due date for filing the return of income under section 263(1).

(2) The provisions of this section shall not apply to any tax year beginning on or after the 1st April, 2029.

(3) For the purposes of this section, "federal co-operative" means a "federal co-operative" as defined in section 3(k) of the Multi-State Co-operative Societies Act, 2002 (39 of 2002) and notified as such by the Central Government.]

----------------------------------------

S.142 Deductions in respect of profits and gains from housing projects

In respect of any tax year, where--

(a) the gross total income of an assessee, includes any profits and gains derived from the business of developing and building housing projects or rental housing projects referred to in section 80-IBA of the Income-tax Act, 1961 (43 of 1961); and (b) such assessee is eligible to claim a deduction from the profits and gains derived from such business for such tax year under the provisions of the said section, as if the said Act had not been repealed, there shall be allowed, in computing the total income of the assessee, a deduction from the profits and gains derived from such business, subject to the conditions that--

(i) the amount of deduction is calculated as per the provisions of section 80-IBA of the Income-tax Act, 1961 (43 of 1961); and (ii) the deduction under this Act shall be allowed only for such tax years, as would have been allowed under section 80-IBA of the Income-tax Act, 1961 (43 of 1961), as if the said Act had not

S.148 Deduction in respect of certain inter-corporate dividends

(1) If the gross total income of a domestic company in any tax year includes any income by way of dividends from--

(a) any other domestic company; or

(b) a foreign company; or

(c) a business trust, such domestic company shall be allowed a deduction of an amount equal to so much of the income by way of dividends received from the person mentioned in clause (a) or (b) or (c) as does not exceed the amount of dividend distributed by it at least one month before the due date for filing the return of income under section 263(1).

(2) Where any deduction, in respect of the amount of dividend distributed by the domestic company, has been allowed under sub-section (1) in any tax year, no deduction shall be allowed in respect of such amount in any other tax year.

S.151 Deduction in respect of royalty income, etc., of authors of certain books other than text-books

(1) Where, in the case of an individual, being an author resident in India, the gross total income includes any income, derived by him in the exercise of his profession, on account of any lump sum consideration for the assignment or grant of any of his interests in the copyright of any book being a work of literary, artistic or scientific nature, or of royalty or copyright fees (whether receivable in lump sum or otherwise) in respect of such book, there shall, as per and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction from such income, computed in the manner specified in sub-section (2).

(2) The deduction under this section shall be equal to the whole of such income referred to in sub-section (1), or an amount of ₹ 300000, whichever is less.

(3) Where the income by way of such royalty or the copyright fee is not a lump sum consideration in lieu of all rights of the assessee in the book, so much of the i

S.152 Deduction in respect of royalty on patents

(1) An assessee, being an individual, who is--

(a) resident in India;

(b) a patentee;

(c) in receipt of income by way of royalty in respect of a patent registered on or after the 1st April, 2003 under the Patents Act, 1970 (39 of 1970); and.;

(d) having gross total income for the tax year which includes royalty, shall be allowed a deduction from such income computed in the manner specified in sub-sections (2) to (7).

(2) The deduction under this section shall be equal to the whole of such income referred to in sub-section (1) or ₹ 300000, whichever is less.

(3) Where a compulsory licence is granted in respect of any patent under the Patents Act, 1970 (39 of 1970), the income by way of royalty for the purpose of allowing deduction under this section shall not exceed the amount of royalty under the terms and conditions of a licence settled by the Controller under that Act.

(4) In respect of any income earned from any source outside Ind

S.153 Deduction for interest on deposits

(1) An assessee who is--

(a) an individual, not being a senior citizen; or

(b) an individual, being a senior citizen; or

(c) a Hindu undivided family, shall be allowed a deduction from the gross total income, subject to conditions specified in sub-section (2), where it includes income by way of interest on deposits with--

(i) a banking company to which the Banking Regulation Act, 1949 (10 of 1949), applies (including any bank or banking institution referred to in section 51 of that Act); or

(ii) a co-operative society engaged in carrying on the business of banking (including a co-operative land mortgage bank or a co-operative land development bank); or

(iii) a Post Office as defined in section 2(k) of the Post Office Act, 2023.

(2) The deduction under sub-section (1) shall be allowed for a tax year as follows:--

(a) in case of an assessee mentioned in sub-section (1)(a) or (c), the whole of the interest up to a maximum amount

S.154 Deduction in case of a person with disability 

(1) An individual, being resident in India, who is certified by a medical authority, at any time during the tax year, as a person with disability or person with severe disability, shall be allowed a deduction of ₹ 75000 or ₹ 125000, respectively, while computing his total income.

(2) The deduction under sub-section (1) shall be allowed only if all of the following conditions are fulfilled:--

(a) the individual furnishes a copy of the certificate issued by the medical authority;

(b) if the certificate specifies that the disability needs reassessment of its extent after a period stipulated in it, the deduction shall not be allowed for any tax year succeeding the tax year in which the certificate expires, unless a new disability certificate is obtained and furnished; and (c) the certificate referred to in clauses (a) and (b) of this sub-section is furnished in the form and manner, as may be prescribed, along with the return of income under section 263 for the tax

S.159 Agreement with foreign countries or specified territories and adoption by Central Government of agreement between specified associations for double taxation relief 

(1) The Central Government may enter into an agreement with the Government of--

(a) any other country; or

(b) any specified territory, for the purposes mentioned in sub-section (3), and may, by notification, make such provisions as necessary for implementing the agreement.

(2) Any specified association in India may enter into an agreement with any specified association in the specified territory for the purposes mentioned in sub-section (3) and the Central Government may, by notification, make such provisions as may be necessary for adopting and implementing such agreement.

(3) The agreement mentioned in sub-section (1) or (2) may be entered for--

(a) the granting of relief in respect of--

(i) income on which income-tax under this Act and income-tax in that country or specified territory, as the case may be have been paid;

(ii) income-tax chargeable under this Act and under the corresponding law in force in that country or specified

S.160 Countries with which no agreement exists 

(1) If any person who is resident in India in any tax year proves that, in respect of his income which accrued or arose during that tax year outside India (and which is not deemed to accrue or arise in India), he has paid in any country with which there is no agreement under section 159 for the relief or avoidance of double taxation, income-tax, by deduction or otherwise, under the law in force in that country, he shall be entitled to the deduction from the Indian income-tax payable by him of a sum calculated on such doubly taxed income ,--

(a) at the Indian rate of tax or the rate of tax of the said country, whichever is the lower; or

(b) at the Indian rate of tax if both the rates are equal.

(2) If any non-resident person is assessed on his share in the income of a registered firm assessed as resident in India in any tax year and such share includes any income accruing or arising outside India during that tax year (and which is not deemed to accrue or arise i

S.161 Computation of income from international transaction and specified domestic transaction having regard to arm's length price 

(1) Any income arising from an international transaction or a specified domestic transaction shall be determined having regard to the arm's length price.

(2) Any allowance for any expense or interest arising from an international transaction or a specified domestic transaction shall also be determined having regard to the arm's length price.

(3) If in an international transaction or specified domestic transaction, two or more associated enterprises enter into a mutual agreement or arrangement for--

(a) allocation or apportionment of any cost or expense incurred or to be incurred in connection with a benefit, service or facility provided or to be provided to any one or more of such enterprises; or

(b) any contribution to any cost or expense incurred or to be incurred in connection with a benefit, service or facility provided or to be provided to any one or more of such enterprises, the cost or expense allocated or apportioned to, or, contributed by, any s

S.156 Rebate of income-tax in case of certain individuals

(1) An assessee, being an individual resident in India, shall be entitled to a deduction of 100% of income-tax payable or ₹ 12500, whichever is less, from the income-tax (computed before allowing the deduction under this section) chargeable on the total income for any tax year if such total income does not exceed ₹ 500000.

(2) Where the total income of a resident individual assessee for any tax year is chargeable to tax under section 202(1), then from income-tax (computed before allowing the deduction under this section) following deductions shall be allowed, if--

(a) the income does not exceed twelve lakh rupees, 100% of the income-tax payable or ₹ 60000, whichever is less;

(b) the total income exceeds twelve lakh rupees and the income-tax payable on such total income exceeds the amount by which the total income is in excess of twelve lakh rupees, an amount equal to the amount by which the income-tax payable on such total income is in excess of the amount by w

S.158 Relief from taxation in income from retirement benefit account maintained in a notified country

(1) The income accrued to a specified person in a specified account shall be taxed in such manner and in such tax year, as may be prescribed.

(2) For the purposes of this section,--

(a) "notified country" means a country as may be notified by the Central Government;

(b) "specified account" means an account maintained in a notified country by the specified person for his retirement benefits, the income from which is taxed by that notified country at the time of withdrawal or redemption and, not on accrual basis;

(c) "specified person" means a person resident in India having opened a specified account in a notified country while being non-resident in India and resident in that country.

S.157 Relief when salary, etc., is paid in arrears or in advance 

(1) Where the total income of an assessee is assessed at a rate higher than the rate at which it would otherwise have been assessed, due to the following receipts,--

(a) a sum in the nature of arrear or advance salary; or

(b) salary for more than twelve months in any one tax year; or

(c) a payment in the nature of "profits in lieu of salary" under section 18(1); or

(d) arrears of "family pension" as defined in section 93(1)(d), the Assessing Officer shall on an application made to him by the assessee in this behalf, grant such relief, as may be prescribed.

(2) No relief shall be granted on any income on which deduction has been claimed by the assessee in section 19(1) (Table: Sl. No. 12) for any amount mentioned therein, for such, or any other, tax year.

S.163 Meaning of international transaction

(1) For the purposes of this Chapter, the expression "international transaction" means a transaction between two or more associated enterprises, one of which is necessarily a non-resident, and includes--

(a) the purchase, sale, transfer, lease or use of tangible property, including building, transportation vehicle, machinery, equipment, tools, plant, furniture, commodity or any other article, product or thing;

(b) the purchase, sale, transfer, lease or use of intangible property, including the transfer of ownership or the provision of use of rights regarding land use, copyrights, patents, trademarks, licences, franchises, customer list, marketing channel, brand, commercial secret, know-how, industrial property right, exterior design or practical and new design or any other business or commercial rights of similar nature;

(c) capital financing, lending or borrowing of money, including,--

(i) any type of long-term or short-term borrowing, lending or guaran

S.162 Meaning of associated enterprise 

(1) For the purposes of this Chapter, the expression "associated enterprise", in relation to another enterprise, means an enterprise-

(a) which participates, directly or indirectly, or through one or more intermediaries, in the management or control or capital of the other enterprise in the following manner,--

(i) one or more persons who participate, directly or indirectly, or through one or more intermediaries, in management or control or capital of one enterprise, also participate, directly or indirectly, or through one or more intermediaries, in the management or control or capital of the other enterprise; or

(ii) one enterprise holds, at any time during the tax year, directly or indirectly, shares carrying not less than 26% of the voting power in the other enterprise; or

(iii) any person or enterprise holds, at any time during the tax year, directly or indirectly, shares carrying not less than 26% of the voting power in each of such enterprises; or

S.155 Rebate to be allowed in computing income-tax

(1) In computing income-tax on the total income of an assessee with which he is chargeable for any tax year, there shall be allowed from income-tax (as computed before allowing the deductions under this Part), subject to the provisions of section 156, the deductions specified therein.

(2) The deduction under section 156, shall not, in any case, exceed income-tax (as computed before allowing the deductions under this Part) on the total income of the assessee with which he is chargeable for any tax year.

S.166 Reference to Transfer Pricing Officer

(1) Where,--

(a) the assessee has entered into an international transaction or specified domestic transaction in any tax year; and (b) the Assessing Officer considers it necessary or expedient so to do, he may refer the determination of the arm's length price in relation to such transaction to the Transfer Pricing Officer, with the previous approval of the Principal Commissioner or Commissioner.

(2) No reference under sub-section (1) for computation of the arm's length price in relation to an international transaction or a specified domestic transaction shall be made, if the Transfer Pricing Officer has declared that option exercised by the assessee in sub-section (9) in relation to such transaction is valid for such tax year.

(3) If any reference for an international transaction or a specified domestic transaction under sub-section (1), in respect of a tax year, for which the option is declared valid under sub-section (9) is made before or after such declarati

S.168 Advance pricing agreement

(1) The Board, with the approval of the Central Government, may enter into an advance pricing agreement with any person, determining the--

(a) arm's length price or specifying the manner in which the arm's length price is to be determined, in relation to an international transaction to be entered into by that person;

(b) income referred to in section 9(2), or specifying the manner in which the said income is to be determined, as is reasonably attributable to the operations carried out in India by or on behalf of that person, being a non-resident.

(2) The manner of determination of the arm's length price referred to in sub-section (1)(a) or the income referred to in sub-section 1(b) may include, respectively,--

(a) the methods referred to in section 165(1); or

(b) the methods provided by rules made under this Act, with such adjustments or variations, as may be necessary or expedient so to do.

(3) Irrespective of anything contained in section

S.165 Determination of arm's length price

(1) The arm's length price in relation to an international transaction or specified domestic transaction shall be determined by any of the following methods, being the most appropriate method--

(a) comparable uncontrolled price method;

(b) resale price method;

(c) cost plus method;

(d) profit split method;

(e) transactional net margin method;

(f) such other method as may be prescribed by the Board.

(2) The most appropriate method referred to in sub-section (1) shall be,--

(a) selected having regard to the nature of transaction or class of transaction or class of associated enterprise or functions performed by such enterprises or such other relevant factors as the Board may prescribe;

(b) applied for determination of arm's length price in such manner as may be prescribed.

(3) The arm's length price shall be--

(a) in case, only one price is determined by the most appropriate method,--

(i) the price de

S.169 Effect to advance pricing agreement 

1 [(1) Irrespective of anything to the contrary contained in section 263, where an income is modified as a result of advance pricing agreement entered into with any person then, such person shall, or any other person being an associated enterprise may,--

(a) furnish a return or a modified return in accordance with and limited to the agreement; and (b) the time period for furnishing such return or modified return shall be three months from the end of the month in which the agreement was entered into, where the tax years relevant for such return or modified return shall be the years covered by such agreement.]

(2) Except as provided in this section, all other provisions of this Act shall apply accordingly as if the modified return is a return furnished under section 263.

(3) Where a modified return is furnished under sub-section (1), and assessment or reassessment proceedings, in respect of a tax year to which the agreement applies, were initiated before the fili

S.164 Meaning of specified domestic transaction 

For the purposes of this Chapter, the expression "specified domestic transaction" in case of an assessee means any of the following transactions (not being an international transaction)--

(a) any transaction referred to in section 122;

(b) any transfer of goods or services referred to in section 140(9);

(c) any business transacted between the assessee and other person as referred to in section 140(73);

(d) any transaction, referred to in any other section under Chapter VIII 1[***], to which provisions of section 140(9) or (13) of this Act or section 80-IA(8) or (10) of the Income-tax Act, 1961 (43 of 1961) are applicable;

(e) any business transacted between the persons referred to in section 205(4);

(f) any other transaction as may be prescribed, and where the aggregate of such transactions entered into by the assessee in a tax year exceeds a sum of twenty crore rupees.

-------------------------------------

1. Omitted by Finan

S.167 Power of Board to make safe harbour rules

(1) The determination of--

(a) income referred to in section 9(2); or

(b) arm's length price under section 165 or 166, shall be subject to safe harbour rules.

(2) For the purposes of sub-section (1), the Board may make rules for safe harbour.

(3) For the purposes of this section, "safe harbour" means circumstances in which the income-tax authorities shall accept ,--

(a) the transfer price; or

(b) the income, deemed to accrue or arise under section 9(2), declared by the assessee.

S.174 Avoidance of income-tax by transactions resulting in transfer of income to non-residents

(1) Where there is a transfer of assets before and after the commencement of this Act, and by virtue or in consequence of it,--

(a) either alone; or

(b) in conjunction with associated operations, any income becomes payable to a non-resident, the provisions of this section shall apply.

(2) If any person ("first mentioned person"), by means of any transfer referred to in sub-section (1), either alone or in conjunction with associated operations, acquires any rights,--

(a) by virtue of which he has, within the meaning of this section, power to enjoy, whether forthwith or in the future, any income of a non-resident; and (b) such income would have been chargeable to income-tax if it were such first mentioned person's income, then, that income shall, whether or not it would have been chargeable to income-tax under any other provisions of this Act, be deemed to be the income of such first mentioned person for all the purposes of this Act.

(3) If any such

S.173 Definitions of certain terms relevant to determination of arm's length price, etc 

For the purposes of this section and sections 161, 162, 163, 165, 171 and 172, unless the context otherwise requires,--

(a) "arm's length price" means a price which is applied or proposed to be applied in a transaction between persons other than associated enterprises, in uncontrolled conditions;

(b) "enterprise" means a person (including a permanent establishment of such person) who is, or has been, or is proposed to be, engaged in any activity relating to--

(i) the production, storage, supply, distribution, acquisition or control of articles or goods; or

(ii) know-how, patents, copyrights, trade-marks, licences, franchises or any other business or commercial rights of similar nature; or

(iii) any data, documentation, drawing or specification relating to any patent, invention, model, design, secret formula or process of which the other enterprise is the owner or in respect of which the other enterprise has exclusive rights; or

(iv) provisi

S.171 Maintenance, keeping and furnishing of information and document by certain persons

(1) Every person, who--

(a) has entered into an international transaction or specified domestic transaction; or

(b) is a constituent entity of an international group, shall keep and maintain such information and document in respect thereof and for such period and in such manner, as may be prescribed.

(2) The Assessing Officer or the Commissioner (Appeals) may, during any proceeding under this Act, require any person referred to in sub-section (1)(a) to furnish any information or document referred therein within ten days from the date of receipt of a notice issued in this regard.

(3) For the purposes of sub-section (2), the Assessing Officer or the Commissioner (Appeals) may, on an application made by such person, extend the period of ten days by a further period not exceeding thirty days.

(4) Every person referred to in sub-section (1)(b) shall furnish the information and document referred to in sub-section (1) to the authority prescribed under se

S.172 Report from an accountant to be furnished by persons entering into international transaction or specified domestic transaction

Every person who has entered into an international transaction or specified domestic transaction during a tax year shall obtain a report from an accountant and furnish such report on or before the specified date in the prescribed form duly signed and verified in the manner as may be prescribed by such accountant and setting forth such particulars as may be prescribed.

S.175 Avoidance of tax by certain transactions in securities

(1) Where the owner of any securities (herein referred to as "the owner") sells or transfers such securities and buys back or reacquires them or buys or acquires any similar securities, any interest that becomes payable in respect of such securities --

(a) is receivable by a person other than the owner, shall be deemed, for all purposes of this Act, to be the income of the owner; and (b) shall not be the income of the other person, irrespective of whether it would have been chargeable to income-tax under any other provision of this Act.

(2) Where similar securities as referred to in sub-section (1) are bought or acquired, the owner shall not be under greater liability to income-tax than he would if the original securities had been bought back or reacquired.

(3) If any person has had a beneficial interest in any securities at any time during a tax year, and the result of any transaction relating to such securities or the income from it is that, in respect of suc

S.176 Special measures in respect of transactions with persons located in notified jurisdictional area 

(1) The Central Government may, by notification specify any country or territory outside India, as a notified jurisdictional area in relation to transactions entered into by any assessee, having regard to the lack of effective exchange of information with such jurisdiction.

(2) Irrespective of anything contrary in this Act, if an assessee enters into a transaction where one of the parties to the transaction is a person located in a notified jurisdictional area, then--

(a) all the parties to the transaction shall be deemed to be associated enterprises within the meaning of section 162;

(b) any transaction of the nature described in sections 163(1) and (2) shall be deemed to be an international transaction within the meaning of section 163, and the provisions of sections 161, 162, 163, 165 (except the benefit of variation specified in sections 165(3)(o)(//)), 166, 167, 171, 172 and 173 shall apply accordingly.

(3) Irrespective of anything to the contrary i

S.177 Limitation on interest deduction in certain cases

(1) Irrespective of anything contrary in this Act, any expenditure by way of interest or similar payment in respect of excess interest, as specified in sub-section (4), shall not be deductible in computation of income chargeable under the head "Profits and gains of business or profession", if,--

(a) it is paid or payable by an Indian company or a permanent establishment of a foreign company in India, in respect of any debt issued by an associated enterprise which is a non-resident; and (b) the sum of such expenditure in a tax year exceeds one crore rupees.

(2) Where a lender, not being an associated enterprise, has issued a debt referred to in sub-section (1), such debt shall be deemed to have been issued by an associated enterprise if an associated enterprise has--

(a) provided an implicit or explicit guarantee to the lender in respect of such debt; or

(b) deposited a corresponding and matching funds with such lender.

(3) The provisions of this s

S.179 Impermissible avoidance arrangement

(1) An impermissible avoidance arrangement means an arrangement, the main purpose of which is to obtain a tax benefit, and it--

(a) creates rights, or obligations, which are not ordinarily created between persons dealing at arm's length;

(b) results, directly or indirectly, in the misuse, or abuse, of the provisions of this Act;

(c) lacks commercial substance or is deemed to lack commercial substance under section 180, in whole or in part; or

(d) is entered into, or carried out, by means, or in a manner, which are not ordinarily employed for bona fide purposes.

(2) An arrangement shall be presumed, unless it is proved to the contrary by the assessee, to have been entered into, or carried out, for the main purpose of obtaining a tax benefit, if the main purpose of a step in, or a part of, the arrangement is to obtain a tax benefit, irrespective of the fact that the main purpose of the whole arrangement is not to obtain a tax benefit.

S.178 Applicability of General Anti-Avoidance Rule

Section 178 - 

(1) Irrespective of anything contained in this Act, an arrangement entered into by an assessee may be declared to be an impermissible avoidance arrangement and the consequence in relation to tax arising from it may be determined subject to 5 the provisions of this Chapter.

(2) The provisions of this Chapter may be applied to any step in, or a part of, the arrangement as they are applicable to the arrangement.

S.180 Arrangement to lack commercial substance

(1) An arrangement shall be deemed to lack commercial substance, if--

(a) the substance or effect of the arrangement as a whole, is inconsistent with, or differs significantly from, the form of its individual steps or a part; or

(b) it involves or includes--

(i) round trip financing;

(ii) an accommodating party;

(iii) elements that have effect of offsetting or cancelling each other;

(iv) a transaction which is conducted through one or more persons and disguises the value, location, source, ownership or control of funds which is the subject matter of such transaction;

(c) it involves the location of an asset or of a transaction or of the place of residence of any party which is without any substantial commercial purpose other than obtaining a tax benefit (but for the provisions of this Chapter) for a party; or

(d) it does not have a significant effect upon the business risks or net cash flows of any party to the arrangement apa

S.181 Consequences of impermissible avoidance arrangement

(1) If an arrangement is declared to be an impermissible avoidance arrangement, then, the consequences, in relation to tax, of the arrangement, including denial of tax benefit or a benefit under a tax treaty, shall be determined, in the manner as deemed appropriate in the circumstances of the case.

(2) The consequences of an arrangement declared to be an impermissible avoidance arrangement as referred to in sub-section (1) shall include but shall not be limited to the following:--

(a) disregarding, combining or recharacterising any step in, or a part or whole of, the impermissible avoidance arrangement;

(b) treating the impermissible avoidance arrangement as if it had not been entered into or carried out;

(c) disregarding any accommodating party or treating any accommodating party and any other party as one and the same person;

(d) deeming persons who are connected persons in relation to each other to be one and the same person for the purposes of

S.182 Treatment of connected person and accommodating party

In this Chapter, in determining whether a tax benefit exists,--

(a) the parties who are connected persons in relation to each other may be treated as one and the same person;

(b) any accommodating party may be disregarded;

(c) the accommodating party and any other party may be treated as one and the same person;

(d) the arrangement may be considered or looked through by disregarding any corporate structure.

S.184 Interpretation

Section 184 - 

For the purposes of this Chapter, unless the context otherwise requires,--

(1) "accommodating party" means a party to an arrangement, if the main purpose of the direct or indirect participation of that party in the arrangement, in whole or in part, is to obtain, directly or indirectly, a tax benefit (but for the provisions of this Chapter) for the assessee whether or not the party is a connected person in relation to any party to the arrangement;

(2) "arrangement" means any step in, or a part or whole of, any transaction, operation, scheme, agreement or understanding, whether enforceable or not, and includes the alienation of any property in such transaction, operation, scheme, agreement or understanding;

(3) "asset" includes property, or right, of any kind;

(4) "benefit" includes a payment of any kind whether in tangible or intangible form;

(5) "connected person" means any person who is connected directly or indirectly to an

S.185 Mode of taking or accepting certain loans, deposits and specified sum

(1) No person shall take or accept from another person any loan or deposit or specified sum, except through--

(a) an account payee cheque; or

(b) account payee bank draft; or

(c) electronic clearing system through a bank account; or

(d) any other prescribed electronic mode, if ,--

(i) the amount or the aggregate amount of such loan, deposit, or specified sum; or

(ii) the amount or the aggregate amount of any previously taken or accepted loan or deposit or specified sum by such person from such another person, which is remaining unpaid, whether due for repayment or not, as on the date of taking or accepting such amount as referred to in clause (i); or

(iii) the aggregate of the amounts referred to in clauses (i) and (ii), is ₹ 20000 or more.

(2) Sub-section (1) shall not apply to loans or deposits or specified sums taken or accepted from or by,--

(a) the Government;

(b) any banking company, post office savings ban

S.186 Mode of undertaking transactions

Section 186 - 

(1) No person shall receive an amount of ₹ 200000 or more-

( a) in aggregate from a person in a day; or

(b) in respect of a single transaction; or

(c) in respect of transactions relating to one event or occasion from a person, except through--

(i) an account payee cheque; or

(ii) account payee bank draft; or

(iii) electronic clearing system through a bank account; or

(iv) any other electronic mode, as may be prescribed.

(2) Sub-section (1) shall not apply to--

(a) any receipt by Government, any banking company, post office savings bank or co-operative bank;

(b) transactions of the nature referred to in section 185;

(c) such other persons or class of persons or receipts, as may be notified by the Central Government.

S.187 Acceptance of payment through prescribed electronic modes

Every person shall provide facility for accepting payment, through electronic modes as may be prescribed, in addition to other electronic modes, if any, being provided by him, where--

(a) such person is carrying on business or profession; and (b) total sales, turnover or gross receipts in such business or profession exceeds fifty crore rupees during the immediately preceding tax year.

S.219 Conversion of an Indian branch of foreign company into subsidiary Indian company

(1) Where a foreign company is engaged in the business of banking in India through its branch situated in India and such branch is converted into a subsidiary Indian company as per the scheme framed by the Reserve Bank of India, then, irrespective of anything contained in this Act and subject to the conditions as may be notified by the Central Government,--

(a) the capital gains arising from such conversion shall not be chargeable to tax in the tax year in which such conversion takes place; and (b) the provisions of this Act relating to--

(i) treatment of unabsorbed depreciation, set off or carry forward and set off of losses;

(ii) tax credit in respect of tax paid on deemed income relating to certain companies; and (iii) computation of income of the foreign company and subsidiary Indian company, shall apply with such exceptions, modifications and adaptations as specified in that notification.

(2) In case of failure to comply with any of the conditions s

S.215 Capital gains on transfer of foreign exchange assets not to be charged in certain cases 

(1) Where, in case of an assessee, being a non-resident Indian,--

(a) any long-term capital gains arises from the transfer of a foreign exchange asset (herein referred to as original asset); and (b) within six months after the date of such transfer, he has invested the whole or any part of the net consideration in any specified asset (herein referred to as new asset), then the capital gains shall be dealt with in the following manner:--

(i) if the cost of the new asset is not less than the net consideration in respect of the original asset, the whole of such capital gain shall not be charged under section 67;

(ii) if the cost of the new asset is less than the net consideration in respect of the original asset, then the capital gain computed by the following formula shall not be charged under section 67:--

A=B×C/D Where, A = the capital gains not to be charged under section 67;

B = whole of the capital gain;

C = cost of acquisition of the ne

S.217 Application of benefits under sections 212 to 216

1 [ 217. Application of benefits under sections 212 to 216 (1) Where a non-resident Indian in any tax year,--

(a) becomes assessable as a resident in India in respect of total income in a subsequent year; and (b) furnishes a declaration in writing to the Assessing Officer along with his return of income under section 263 for the tax year for which he is so assessable, to the effect that provisions of sections 212 to 216 shall continue to apply to him in relation to the investment income derived from any foreign exchange asset referred to in section 212(e) other than shares in an Indian company, then the provisions of sections 212 to 216 shall continue to apply in relation to such income for that tax year and every subsequent tax year until the transfer or conversion (otherwise than by transfer) of such assets into money.

(2) A non-resident Indian may choose not to be governed by the provisions of sections 212 to 216 for any tax year by declaring it in his return of in

S.220 Foreign company said to be resident in India

(1) Where a foreign company is said to be a resident in India in any tax year and such company has not been a resident in India in earlier tax years, then, irrespective of anything in this Act and subject to the conditions as may be notified by the Central Government in this behalf, the provisions of this Act relating to--

(a) the computation of total income;

(b) treatment of unabsorbed depreciation;

(c) set off or carry forward and set off of losses;

(d) collection and recovery; and (e) special provisions relating to avoidance of tax, shall apply with such exceptions, modifications and adaptations as specified in that notification for such tax year.

(2) Where the determination regarding foreign company to be resident in India has been made in the assessment proceedings for any tax year, then, the provisions of sub-section (1) shall also apply to any other tax year succeeding such tax year, which ends on or before the date of completion of such as

S.218 Tax on business income of Offshore Banking Units or International Financial Services Centre unit

1 [ 218. Tax on business income of Offshore Banking Units or International Financial Services Centre unit Where the total income of an assessee includes income of the nature referred to in section 147(3), the aggregate of income-tax payable by the assessee shall be the aggregate of income-tax computed on the income specified in column B of the Table below at the rate specified in the corresponding entry in column C of the said Table:

TABLE Sl. No. Income Rate of income-tax payable A B C

1. Income referred to in section 147(3) 15%

2. Total income as reduced by income referred to in Sl. No. (1).

Rates in force.]

---------------------------------------------

1 . Substituted by Finance Act, 2026, w.e.f. 01.04.2026, for the followings:-

"218. Chapter not to apply if the assessee so chooses A non-resident Indian may choose not to be governed by the provisions of sections 212 to 217 for any tax year by declaring it in his return of income

S.214 Tax on investment income and long-term capital gains

The income-tax payable on the total income of an assessee, being a non-resident Indian, which includes income specified in column B of the Table below, shall be the aggregate of income-tax computed at the rate specified in the column C applied on the corresponding income specified in column B.

Table Sl. No. Income Rate of Income-tax payable A B C

1. Income from investment.

20%

2. Income from long-term capital gains on specified asset.

12.5%

3. Total income as reduced by income referred to against serial numbers 1 and 2.

Rates in force.

S.216 Return of income not to be furnished in certain cases

It shall not be necessary for a non-resident Indian to furnish a return of his income under section 263(1), if--

(a) his total income during the tax year consisted only of investment income or income by way of long-term capital gains or both; and (b) the tax deductible at source under the provisions of Chapter XIX-B has been deducted from such income.

S.224 Tax on income of investment fund and its unit holders

(1) Irrespective of anything contained in any other provision of this Act and subject to the provisions of this section, where a person, being a unit holder of an investment fund, out of investments made in the investment fund, receives any income or any income accrues or arises to him, such income shall be chargeable to income-tax in the same manner as if, it were the income accruing or arising to, or received by, such person, had the investments made by the investment fund been made directly by him.

(2) Where in any tax year, the net result of computation of total income of the investment fund, without giving effect to the provisions of Schedule V (Table: Sl. No. 1), is a loss under any head of income and such loss cannot be or is not wholly set off against income under any other head of income of the said tax year, then out of such loss,--

(a) the loss arising to the investment fund as a result of the computation under the head "Profits and gains of business or pro

S.221 Tax on income from securitisation trusts

(1) Irrespective of anything contained in this Act, where a person being an investor of a securitisation trust, receives any income or any income accrues or arises to him, out of investments made in the securitisation trust, such income shall be chargeable to income-tax in the same manner as if it were the income accruing or arising to, or received by, such person, had the investments by the securitisation trust been made directly by him.

(2) The income paid or credited by the securitisation trust shall be deemed to be of the same nature and in the same proportion in the hands of the person referred to in sub-section (1), as if it had been received by, or had accrued or arisen to, the securitisation trust during the tax year.

(3) The income accruing or arising to, or received by, the securitisation trust during a tax year, if not paid or credited to the person referred to in sub-section (1), shall be deemed to have been credited to the account of the said person--

S.222 Tax on income in case of venture capital undertakings 

(1) Irrespective of anything contained in any other provision of this Act, where a person, out of investments made in a venture capital company or venture capital fund, receives any income, or any income accrues or arises to him, such income shall be chargeable to income-tax in the same manner as if it were the income accruing or arising to, or received by, such person, had he made investments directly in the venture capital undertaking.

(2) The person responsible for crediting or making payment of the income on behalf of a venture capital company or a venture capital fund and the venture capital company or venture capital fund shall furnish, within such time, as may be prescribed, to the person who is liable to tax in respect of such income and to the prescribed income-tax authority, a statement in the prescribed form and verified in the prescribed manner, giving details of the nature of the income paid or credited during the tax year and such other relevant details, as may

S.223 Tax on income of unit holder and business trust

(1) Irrespective of anything contained in any other provisions of this Act, any income distributed by a business trust to its unit holders shall be deemed to be of the same nature and in the same proportion in the hands of the unit holder as it had been received by, or accrued to, the business trust.

(2) Subject to the provisions of sections 196, 197 and 198, the total income of a business trust shall be charged to tax at the maximum marginal rate.

(3) If in any tax year, the distributed income or any part thereof, received by a unit holder from the business trust is of the nature as referred to in Schedule V (Table: Sl. No. 3) or (Table: Sl. No. 4), then, such distributed income or part thereof shall be deemed to be income of such unit holder and shall be charged to tax as income of the tax year.

(4) The provisions of sub-section (1) shall not apply in respect of any sum referred to in section 92(2)(k) received by a unit holder from a business trust.

(5

S.225 Income from business of operating qualifying ships

Irrespective of anything contained in sections 26 to 54 (except 50 and 53), in the case of a company, the income from the business of operating qualifying ships--

(a) may, at its option, be computed as per provisions of this Part; and (b) such income shall be deemed to be the profits and gains of such business chargeable to tax under the head "Profits and gains of business or profession".

S.228 Relevant shipping income and exclusion from book profit 

(1) For the purposes of this Part, the relevant shipping income of a tonnage tax company means--

(a) its profits from core activities referred to in sub-section (3); and (b) its profits from incidental activities referred to in sub-section (7).

(2) Where the aggregate of all such incomes specified in sub-section (1)(b) exceeds 0.25% of the turnover from core activities referred to in sub-section (3), such excess shall not form part of the relevant shipping income for the purposes of this Part and shall be taxable under the other provisions of this Act.

(3) The core activities of a tonnage tax company shall be--

(a) its activities from operating qualifying ships; and (b) other ship-related or inland vessel related activities, as the case may be, as follows:--

(i) shipping contracts in respect of--

(A) earning from pooling arrangements;

(B) contracts of affreightment;

(ii) specific shipping trades, being--

(A) on-board or

S.227 Computation of tonnage income

(1) The tonnage income of a tonnage tax company for a tax year shall be the aggregate of the tonnage income of each qualifying ship computed as per sub-sections (2) and (3).

(2) For the purposes of sub-section (1), the tonnage income of each qualifying ship shall be computed as per the following formula:--

TI= DTI × N where,--

TI = the tonnage income of each qualifying ship;

DTI = the daily tonnage income of each qualifying ship;

N = the number of days in the tax year or in part of the tax year in case the ship is operated by the company as a qualifying ship for only part of the tax year.

(3) For the purposes of sub-section (2), the daily tonnage income of a qualifying ship having tonnage referred to in column B of the Table below shall be the amount specified in the corresponding entry in column C thereof.

Table Sl. No. Qualifying ship having net tonnage Amount of daily tonnage income A B C

1. Up to 1000.

? 70 for eac

S.229 Depreciation and gains relating to tonnage tax assets

(1) For the purposes of computing depreciation under section 230(1)(d), the depreciation for the first tax year of the tonnage tax scheme (herein referred to as the first tax year) shall be computed on the written down value of the qualifying ships as specified under sub-section (2).

(2) The written down value of the block of assets, being ships or inland vessels, as the case may be, as on the first day of the first tax year, shall be divided in the ratio of the book written down value of the qualifying ships (herein referred to as the qualifying assets) and the book written down value of the non-qualifying ships (herein referred to as the other assets), as per the following formula:--

D = A × B/B+C E = A × C/B+C where,--

D = the written down value of the block of qualifying assets as on the first day of the tax year;

E = the written down value of the block of other assets as on the first day of the tax year;

A = the written down value of the exis

S.230 Exclusion of deduction, loss, set off, etc

(1) Irrespective of anything contained in any other provision of this Act, in computing the tonnage income of a tonnage tax company for any tax year (herein referred to as the "relevant tax year") in which it is chargeable to tax as per this Part--

(a) sections 28 to 52 shall apply as if every loss, allowance or deduction referred to therein and relating to or allowable for any of the relevant tax years, had been given full effect to for that tax year itself;

(b) no loss referred to in section 108(1) or (2)(b) or 109(1) or 112(1) or 116(1), in so far as such loss relates to the business of operating qualifying ships of the company, shall be carried forward or set off where such loss relates to any of the tax years when the company is under the tonnage tax scheme;

(c) no deduction shall be allowed under Chapter VIII in relation to the profits and gains from the business of operating qualifying ships; and (d) in computing the depreciation allowance under section

S.226 Tonnage tax scheme

(1) In this Part, a company shall--

(a) be regarded as operating a ship or inland vessel, as the case may be, if it operates any ship or inland vessel, as the case may be, whether owned or chartered by it and includes a case where even a part of the ship or inland vessel, as the case may be, has been chartered in by it in an arrangement such as slot charter, space charter or joint charter;

(b) not be regarded as operating a ship or inland vessel, as the case may be, which has been chartered out by it on bareboat charter-cum-demise terms or on bareboat charter terms for a period exceeding three years.

(2) A tonnage tax company engaged in the business of operating qualifying ships shall compute the profits from such business under the tonnage tax scheme.

(3) The tonnage tax business shall be considered as a separate business distinct from all other activities or business carried on by the company.

(4) The profits referred to in sub-section (2) shall

S.232 Certain conditions for applicability of tonnage tax scheme 

(1) A tonnage tax company shall, subject to and as per the provisions of this section, be required to credit to a reserve account (herein referred to as the Tonnage Tax Reserve Account) an amount, being 20% or more of the book profit derived from the activities referred to in section 228(1)(a) and (b) in each tax year to be utilised in the manner laid down in sub-section (6).

(2) For the purposes of this section, the expression "book profit" shall have the meaning assigned to it in section 206(1)(c) so far as it relates to the income derived from the activities referred to in section 228(1)(a) and (b).

(3) Where the company has--

(a) book profit from the business of operating qualifying ships; and (b) book loss from any other sources, and consequently, the company is not in a position to create the full or any part of the reserves under sub-section (1), the company shall create the reserves to the extent possible in that tax year and the shortfall, if any, shal

S.231 Method of opting of tonnage tax scheme and validity

(1) A qualifying company may opt for the tonnage tax scheme by making an application to the Joint Commissioner having jurisdiction over the company in the form and manner, as may be prescribed, for such scheme.

(2) A qualifying company may make an application within three months, of the date of its incorporation, or of the date on which it becomes a qualifying company for the first time.

(3) A Unit of an International Financial Services Centre which has availed of deduction under section 147 may make an application within three months from the date on which such deduction ceases.

(4) On receipt of an application for option for tonnage tax scheme under sub-section (1), the Joint Commissioner may call for such information or documents from the company as he thinks necessary in order to satisfy himself about the eligibility of the company and after satisfying himself about such eligibility of the company to make such option for tonnage tax scheme, he shall pass an

S.233 Amalgamation and demerger 

(1) Where there has been an amalgamation of a company with another company or companies, then, subject to the other provisions of this section, the provisions relating to the tonnage tax scheme shall, as far as may be, apply to the amalgamated company, if it is a qualifying company.

(2) Where the amalgamated company is not a tonnage tax company, it shall exercise an option for tonnage tax scheme under section 231(1) within three months from the date of the approval of the scheme of amalgamation.

(3) Where the amalgamating companies are tonnage tax companies, the provisions of this Part shall, as far as may be, apply to the amalgamated company for such period as the option for tonnage tax scheme which has the longest unexpired period continues to be in force.

(4) Where one of the amalgamating companies is a qualifying company as on the 1st October, 2004 and which has not exercised the option for tonnage tax scheme before the 1st January, 2005, the provisions of

S.235 Interpretation 

For the purposes of this Part,--

(a) "bareboat charter" means hiring of a ship or inland vessel, as the case may be, for a stipulated period on terms which give the charterer possession and control of the ship or inland vessel, as the case may be, including the right to appoint the master and crew;

(b) "bareboat charter-cum-demise" means a bareboat charter where the ownership of the ship or inland vessel, as the case may be, is intended to be transferred after a specified period to the company to whom it has been chartered;

(c) "Director-General of Shipping" means the Director-General of Shipping appointed by the Central Government under section 7(1) of the Merchant Shipping Act, 1958 (44 of 1958);

(d) "factory ship" includes a vessel providing processing services in respect of processing of the fishing produce;

(e) "fishing vessel" shall have the meaning assigned to it in section 3(12) of the Merchant Shipping Act, 1958 (44 of 1958);

(f) "

S.315 Assessment after partition of Hindu undivided family 

7. Partition  (1) A Hindu family, hitherto assessed as undivided, shall be deemed for the purposes of this Act to continue to be a Hindu undivided family, except where and in so far as a finding of partition has been given under this section in respect of the Hindu undivided family.

(2) Where, at the time of making an assessment under section 270 or section 271, it is claimed by or on behalf of any member of a Hindu family assessed as undivided that a partition, whether total or partial, has taken place among the members of such family, the Assessing Officer shall make an inquiry thereinto after giving notice of the inquiry to all the members of the family.

(3) On the completion of the inquiry, the Assessing Officer shall record a finding as to whether there has been a total or partial partition of the joint family property, and, if there has been such a partition, the date on which it has taken place.

(4) Where a finding of total or partial partition has been

S.316 Shipping business of non-residents 

8. Profits of non-residents from occasional shipping business  (1) Irrespective of anything in the other provisions of this Act, the provisions of this section shall apply for the purpose of levy and recovery of tax in the case of any ship, belonging to or chartered by a non-resident, which carries passengers, livestock, mail or goods shipped at a port in India.

(2) Where such a ship carries passengers, livestock, mail or goods shipped at a port in India,--

(a) 7.5% of the amount paid or payable on account of such carriage shall be deemed to be income accruing in India to the owner or charterer on account of such carriage, whether that amount is paid or payable in or out of India; and (b) the amount referred to in clause (a) shall include the amount paid or payable by way of demurrage charge or handling charge or any other amount of similar nature.

(3) Before the departure from any port in India of any such ship, the master of the ship shall prepare and furnish

S.317 Assessment of persons leaving India

9. Persons leaving India  (1) Irrespective of anything contained in section 4, when it appears to the Assessing Officer that any individual may leave India during the current tax year or shortly after its expiry, with no present intention of returning to India, the total income of such individual for the period beginning from the first day of that current tax year up to the probable date of departure from India (referred to as specified period in this section) shall be chargeable to tax in that current tax year.

(2) The total income of each completed tax year or part of any tax year included in the specified period shall be chargeable to tax at the rate or rates in force in that tax year, and separate assessments shall be made in respect of each such completed tax year or part of any tax year.

(3) The Assessing Officer may estimate the income of such individual for such specified period or any part thereof, where it cannot be readily determined in the manner provided

S.318 Assessment of association of persons or body of individuals or artificial juridical person formed for a particular event or purpose 

10. Association of persons or body of individuals or artificial juridical person formed for a particular event or purpose  (1) Irrespective of anything contained in the section 4, where it appears to the Assessing Officer that any association of persons or a body of individuals or an artificial juridical person, formed or established or incorporated for a particular event or purpose in a tax year is likely to be dissolved in the same year or immediately after such year, the total income of such association or body or juridical person for the period beginning from the first day of that tax year up to the date of its dissolution shall be chargeable to tax in that tax year.

(2) For the purpose of sub-section (1), the provisions of section 317(2) to (6) shall, so far as may be, apply to any proceedings in the case of any such person as they apply in the case of persons leaving India.

S.313 Succession to business or profession otherwise than on death 

6. Succession to business or profession (1) Where a person carrying on any business or profession (hereinafter referred to as the predecessor) has been succeeded therein by any other person (hereinafter referred to as the successor) who continues to carry on that business or profession,--

(a) the predecessor shall be assessed in respect of the income of the tax year in which the succession took place up to the date of succession;

(b) the successor shall be assessed in respect of the income of the tax year after the date of succession.

(2) Irrespective of anything contained in sub-section (1), when the predecessor cannot be found, the assessment of the income of the tax year in which the succession took place up to the date of succession and of the tax year preceding that year shall be made on the successor in like manner and to the same extent as it would have been made on the predecessor, and all the provisions of this Act shall, so far as may be, apply accord

S.314 Effect of order of tribunal or court in respect of business reorganisation

(1) Irrespective of anything to the contrary contained in section 263, if prior to the date of order in respect of business reorganisation, any return of income has been furnished under the provisions of the said section by an entity for any tax year to which such order applies, the successor shall furnish, within six months from the end of the month in which the order was issued, a modified return in such form and manner, as may be prescribed, in accordance with and limited to the said order.

(2) Where the assessment or reassessment proceedings for a tax year to which the order in respect of the business reorganisation applies,--

(a) have been completed on the date of furnishing of the modified return as per the provisions of sub-section (1), the Assessing Officer shall pass an order modifying the total income of the relevant tax year determined in such assessment or reassessment, in accordance with such order in respect of business reorganisation and taking into acc

S.311 Charge of tax where shares of members in association of persons or body of individuals unknown, etc 

(1) Where the individual shares of the members of an association of persons or body of individuals in the whole or any part of the income of such association or body are indeterminate or unknown, tax shall be charged on the total income of such association or body at the maximum marginal rate, subject to the provision of sub-section (2).

(2) In a case referred to in sub-section (1) where the total income of any member of such association or body is chargeable to tax at a rate which is higher than the maximum marginal rate, tax shall be charged on the total income of the such association or body at such higher rate.

(3) Where the individual shares of the members of an association of persons or body of individuals in the whole or any part of the income of such association or body are determinate or known, and--

(a) where the total income of any member of such association or body for the tax year (excluding his share from such association or body) exceeds the maxi

S.312 Executor

5. Executors  (1) The income of the estate of a deceased person shall be chargeable to tax in the hands of the executor as an individual, if there is only one executor, or as an association of persons, if the executors are more than one.

(2) For the purposes of this Act, the executor shall be deemed to be resident or non-resident according to the residential status of the deceased person for the tax year in which his death took place.

(3) For the purposes of this section, "executor" includes an administrator or other person administering the estate of a deceased person.

(4) The assessment of an executor under this section shall be made separately from any assessment that may be made on him in respect of his own income.

(5) Separate assessments shall be made under this section on the total income of each completed tax year or part thereof as is included in the period from the date of the death to the date of complete distribution to the beneficiaries of t

S.310 Share of member of association of persons or body of individuals in income of association or body

(1) Income-tax shall not be payable by an assessee (who is a member of an association of persons or body of individuals) in respect of his share in the income of the association of persons or body of individuals computed in the manner provided in section 309, except in a case referred to in sub-section (2).

(2) Where no income-tax is chargeable on the total income of the association of persons or body of individuals, the share of a member computed as provided in section 309 shall be chargeable to tax as part of his total income.

(3) Where no income-tax is payable by an assessee under sub-section (1),--

(a) if the association of persons or body of individuals is chargeable to tax on its total income at the maximum marginal rate or any higher rate under any of the provisions of this Act, the share of a member computed as aforesaid shall not be included in his total income;

(b) in any other case, the share of a member computed as aforesaid shall form part o

S.308 Charge of tax in case of oral trust

(1) Where a trustee receives or is entitled to receive any income on behalf or for the benefit of any person under an oral trust, then, irrespective of anything contained in any other provision of this Act, tax shall be charged on such income at the maximum marginal rate.

(2) For the purposes of this section, "oral trust" shall have the meaning assigned to it in section 303(3).

S.320 Discontinued business

12. Discontinuance of business, or dissolution  (1) Irrespective of anything contained in section 4, where any business or profession is discontinued in any tax year, the income of the period beginning from the first day of that tax year up to the date of such discontinuance may, at the discretion of the Assessing Officer, be charged to tax in that tax year.

(2) The total income of each completed tax year or part of any tax year included in such period shall be chargeable to tax at the rate or rates in force in that tax year, and separate assessments shall be made in respect of each such completed tax year or part of any tax year.

(3) Any person discontinuing any business or profession shall give to the Assessing Officer notice of such discontinuance within fifteen days thereof.

(4) Where any business is discontinued in any year, any sum received after the discontinuance shall be deemed to be the income of the recipient and charged to tax accordingly in the yea

S.321 Association dissolved or business discontinued

(1) Where any business or profession carried on by an association of persons has been discontinued or where an association of persons is dissolved, the Assessing Officer shall make an assessment of the total income of the association of persons as if no such discontinuance or dissolution had taken place, and all the provisions of this Act, including the provisions relating to the levy of a penalty or any other sum chargeable under any provision of this Act shall apply, so far as may be, to such assessment.

(2) Regardless of the generality of sub-section (1), if the Assessing Officer or the Joint Commissioner (Appeals) or the Commissioner (Appeals) in the course of any proceeding under this Act in respect of any such association of persons as is referred to in that sub-section is satisfied that the association of persons was guilty of any of the acts specified in Chapter XXI, he may impose or direct the imposition of a penalty as per the provisions of that Chapter.

(3)

S.338 Income not to be included in regular income 

While computing the regular income of a registered non-profit organisation, the following income shall not be included:--

(a) income applied outside India, where the Board, by general or special order, directs that such income shall not be so included in its total income in case of a registered non-profit organisation--

(i) created before the 1st April, 1952 for charitable or religious purposes; or

(ii) created on or after the 1st April, 1952 for charitable purposes where such application of income outside India tends to promote international welfare in which India is interested;

(b) the corpus donation received by the registered non-profit organisation under section 339.

S.322 Company in liquidation 

(1) Every person,--

(a) who is the liquidator of any company which is being wound up, whether under the orders of a court or otherwise; or

(b) who has been appointed the receiver of any assets of a company, (herein referred to as the liquidator), shall, within thirty days after he has become such liquidator, give notice of his appointment as such to the Assessing Officer who is entitled to assess the income of the company.

(2) The Assessing Officer shall, after making such inquiries or calling for such information as he may deem fit, notify to the liquidator within three months from the date on which he receives notice of the appointment of the liquidator the amount which, in the opinion of the Assessing Officer, would be sufficient to provide for any tax which is then, or is likely thereafter to become, payable by the company.

(3) The liquidator--

(a) shall not, without the leave of the Principal Chief Commissioner or Chief Commissioner or Princi

S.325 Assessment as a firm 

(1) A firm shall be assessed as a firm for the purposes of this Act, if--

(a) the partnership is evidenced by an instrument; and (b) the individual shares of the partners are specified in that instrument.

(2) A certified copy of the instrument of partnership referred to in sub-section (1) shall accompany the return of income of the firm of the tax year in respect of which assessment as a firm is first sought.

(3) For the purposes of sub-section (2), the copy of the instrument of partnership shall be certified in writing by all the partners (not being minors) or, where the return is made after the dissolution of the firm, by all persons (not being minors), who were partners in the firm immediately before its dissolution and by the legal representative of any such partner who is deceased.

(4) Where a firm is assessed as such for any tax year, it shall be assessed in the same capacity for every subsequent year, if there is no change in the constitution of t

S.319 Assessment of persons likely to transfer property to avoid tax 

11. Persons trying to alienate their assets  (1) Irrespective of anything contained in section 4, where it appears to the Assessing Officer during any current tax year that any person is likely to charge, sell, transfer, dispose of or otherwise part with any of his assets with a view to avoiding payment of any liability under the provisions of this Act, the total income of such person for the period beginning from the first day of that current tax year up to the date when the Assessing Officer commences proceedings under this section shall be chargeable to tax in the current tax year.

(2) For the purpose of sub-section (1), the provisions of section 317(2) to (6) shall, so far as may be, apply to any proceedings in the case of any such person as they apply in the case of persons leaving India.

S.323 Liability of directors of private company

13. Private companies  (1) Irrespective of anything contained in the Companies Act, 2013 (18 of 2013), where any tax due from--

(a) a private company in respect of any income of any tax year; or

(b) any other company in respect of any income of any tax year during which such other company was a private company, cannot be recovered, then, every person, who was a director of the private company at any time during the relevant tax year, shall be jointly and severally liable for the payment of such tax unless he proves that the non-recovery cannot be attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the company.

(2) For the purposes of this section, "tax due" includes penalty, interest, fees or any other sum payable under the Act.

S.324 Charge of tax in case of a firm

14. Assessment of firms  In the case of a firm which is assessable as a firm, tax shall be charged on its total income at the rate as specified in any Central Act for relevant tax year.

S.328 Succession of one firm by another firm 

Where a firm carrying on a business or profession is succeeded by another firm, except in a case covered by section 327, separate assessments shall be made on the predecessor firm and the successor firm as per the provisions of section 313.

S.330 Firm dissolved or business discontinued

(1) Where a firm is dissolved or any business or profession carried on by it has been discontinued, the Assessing Officer shall make an assessment of the total income of the firm, as if no such dissolution or discontinuance had taken place, and all the provisions of this Act, including the provisions relating to the levy of a penalty or any other sum chargeable under any provision of this Act, shall apply, so far as may be, to such assessment.

(2) Regardless of the generality of sub-section (1), if the Assessing Officer or Joint Commissioner (Appeals) or Commissioner (Appeals), in the course of any proceeding under this Act in respect of any such firm as referred to in that sub-section, is satisfied that the firm was guilty of any of the acts specified in Chapter XXI, he may impose or direct the imposition of a penalty as per the provisions of that Chapter.

(3) Every person who was at the time of such dissolution or discontinuance a partner of the firm, and the legal

S.327 Change in constitution of a firm 

15. Change in constitution, succession and dissolution  (1) Where at the time of making an assessment under section 270 or 271, it is found that a change has occurred in the constitution of a firm, the assessment shall be made on the firm as constituted at the time of making the assessment.

(2) For the purposes of this section, there is a change in the constitution of the firm--

(a) if one or more of the partners cease to be partners or one or more new partners are admitted, subject to the condition that at least one person who was partner of the firm before the change continues as partner after such change; or

(b) where all the partners continue with a change in their respective shares or in the shares of some of them.

(3) The provisions of sub-section 2(a) shall not apply to a case where the firm is dissolved on the death of any of its partners.

S.326 Assessment when section 325 not complied with

Irrespective of anything contained in any other provision of this Act, where a firm does not comply with the provisions of section 325 for any tax year,--

(a) no deduction by way of any payment of interest, salary, bonus, commission or remuneration, by whatever name called, made by such firm to any partner of such firm shall be allowed in computing its income chargeable under the head "Profits and gains of business or profession"; and (b) such interest, salary, bonus, commission or remuneration shall not be chargeable to income-tax under section 26(2)(g) in the hands of partners of such firm.

S.329 Joint and several liability of partners for tax payable by firm 

Every person who was, during the tax year, a partner of a firm, and the legal representative of any such person who is deceased, shall be jointly and severally liable along with the firm for the amount of tax, penalty or other sum payable by the firm for the tax year, and all the provisions of this Act, so far as may be, shall apply to the assessment of such tax or imposition or levy of such penalty or other sum.

S.332 Application for registration 

1. Registration  (1) The following persons may, for claiming benefits under this Part as a registered non-profit organisation, make an application for registration in such form and manner, as may be prescribed, to the Principal Commissioner or Commissioner:--

(a) a public trust; or

(b) a society registered under the Societies Registration Act, 1860 (21 of 1860), or under any law in force in India; or

(c) a company registered under section 8 of the Companies Act, 2013 (18 of 2013) or the companies registered under section 25 of the Companies Act, 1956 (1 of 1956) and deemed to have been registered in pursuance of section 465(2)(g) of the Companies Act, 2013 (18 of 2013); or

(d) a University established by law or any other educational institution affiliated thereto or recognised by the Government; or

(e) an institution financed wholly or in part by the Government or a local authority; or

(f) any person as referred to in Schedule III (Table: S

S.333 Switching over of regimes

(1) Nothing contained in section 11, other than Schedule II (Table: Sl. No. 1), Schedule III (Table: Sl. Nos. 27 to 29 and 36) and Schedule VII (Table: Sl. Nos. 10 to 19 and 42 to 45), shall exclude any income of a registered non-profit organisation from its total income for that tax year.

(2) The registration under section 332 shall cease to operate from the date on which the registered non-profit organisation is notified as specified in Schedule III (Table: Sl. No. 27, 28, 29 or 36) or Schedule VII (Table: Sl. No. 42), or from the 1st day of April of the tax year for a registered non-profit organisation which claims exemption under Schedule VII (Table: Sl. No. 43, 44 or 45).

(3) A person, whose registration ceases to operate under sub-section (2), may apply for registration under section 332 subject to the condition that the notification granting exemption to such person under Schedule III (Table: Sl. No. 27, 28, 29 or 36) or Schedule VII (Table: Sl. No. 42) ceases

S.335 Regular income 

Regular income of any tax year of a registered non-profit organisation means--

(a) income from any charitable or religious activity, for which such nonprofit organisation is registered, carried out by it in such tax year;

(b) income other than income covered in clause (e), derived from any property, deposit or investment held wholly for charitable or religious purposes by such registered non-profit organisation in such tax year;

(c) income other than income covered in clause (e), derived from any property, deposit or investment held in part for charitable and religious purposes by such registered non-profit organisation as referred in section 332(2)(b)(ii) in such tax year;

(d) voluntary contributions received by such registered non-profit organisation in such tax year; and (e) gains of any commercial activity permissible under sections 344, 345 and 346, carried out by such registered non-profit organisation in such tax year, computed in such manner, as

S.334 Tax on income of registered non-profit organisation 

2. Income of registered non-profit organisation  (1) The Income-tax payable by a registered non-profit organisation on its total income for any tax year shall be the aggregate of the amounts calculated--

(a) at the rate of 30% on specified income for such tax year; and (b) at the rate applicable on taxable regular income and any residual income for such tax year under other provisions of this Act.

(2) The provisions of this Chapter shall apply irrespective of anything to the contrary contained in any other provision of this Act other than sections 96 to 98.

S.337 Specified income 

The specified income of a registered non-profit organisation shall mean the income as specified in column B of the Table below and shall be taxable in the year provided in the column C thereof:--

Table Sl. No. Specified income Tax year A B C

1. Any anonymous donation received by a registered non-profit organisation other than a registered non-profit organisation created or established--

(i) wholly for religious purposes, or (ii) wholly for charitable and religious purposes (excluding anonymous donation made with a specific direction that such donation is for any university or other educational institution or any hospital; or other medical institution run by such registered non-profit organisation), excluding the anonymous donations up to ₹100000 or 5% of the total donations received by it during the tax year, whichever is higher.

Tax year in which such anonymous donation is received.

2. Any portion of income applied by it, directly or indirectl

S.336 Taxable regular income

The taxable regular income of a registered non-profit organisation for any tax year shall be--

(a) nil, where 85% or more of the regular income of such tax year has been applied as per provisions of section 341 or accumulated under section 342 for charitable or religious purposes, in such tax year as per the provisions of this Part; and (b) in any other case, 85% of the regular income for such tax year as reduced by its application for charitable or religious purposes as per provisions of section 341 or accumulation thereof under section 342 in such tax year as per the provisions of this Part.

S.340 Deemed corpus donation

Where the property of a registered non-profit organisation includes any temple, mosque, gurudwara, church or other place notified under section 133(1)(b)(vi), any sum or sums received by such registered non-profit organisation as donation for the purpose of renovation or repair of such temple, mosque, gurudwara, church or other place, may, at its option, be deemed as forming part of the corpus under section 339, if it--

(a) maintains such corpus as separately identifiable;

(b) applies such corpus only for the purpose for which the donation was made;

(c) invests or deposits such corpus in any of the modes permitted under section 350; and (d) does not apply such corpus for making donation to any person.

S.339 Corpus donation 

Corpus donation means any donation made with a specific direction by the donor that it shall form part of the corpus of the registered non-profit organisation provided that such donation is invested or deposited in any of the modes permitted under section 350 maintained specifically for such corpus.

S.341 Application of income

(1) The following sums shall be allowed as application of income to a registered non-profit organisation:--

(a) any sum, other than the sum referred to in clause (b), applied by it for charitable or religious purpose in India for which it is registered where such sum is paid during the tax year provided that the provisions of section 35(b)(i) and section 36(4), (5), (6), and (7) shall apply in respect of such sum; and (b) 85% of the sum paid by way of donation made to any other registered non-profit organisation.

(2) The application of income under sub-section (1) shall include the following:--

(a) the amount invested or deposited back during the tax year, in the modes permitted under section 350 maintained specifically for such corpus, if--

(i) such investment or depositing back is made within five years from the end of the tax year in which such application of income was made from the corpus; and (ii) the application of income from the corpus is made a

S.342 Accumulated income 

(1) A registered non-profit organisation may accumulate or set apart any part of its regular income during any tax year by furnishing a statement to the Assessing Officer in such form and manner, as may be prescribed, on or before the due date specified in section 263(1) for furnishing the return of income for such tax year stating therein the purpose and period, not exceeding five years, for which the income is being accumulated or set apart. (2) The amount credited or paid by a registered non-profit organisation to any other registered non-profit organisation out of its income accumulated or set apart, shall not be treated as application of income.

(3) The period during which the income is not applied for the purpose for which it is so accumulated or set apart pursuant to an order or injunction of any court, shall be excluded from the said period of five years.

(4) The income accumulated or set apart under sub-section (1) shall be invested or deposited in any of the

S.346 Restriction on commercial activities by registered non-profit organisation, carrying out advancement of any other object of general public utility 

No registered non-profit organisation, carrying out advancement of any other object of general public utility, shall carry out any commercial activity unless,--

(a) such commercial activity is undertaken in the course of actual carrying out of advancement of any object of the general public utility;

(b) the aggregate receipts from such commercial activity or activities do not exceed 20% of the total receipts of such registered non-profit organisation of the relevant tax year; and (c) separate books of account are maintained by such registered non-profit organisation for such activities.

S.345 Restriction on commercial activities by a registered non-profit organisation 

A registered non-profit organisation (other than a registered non-profit organisation mentioned in section 346) shall not carry out any commercial activity unless--

(a) such commercial activity is incidental to the attainment of the objectives of the registered non-profit organisation; and (b) separate books of account are maintained for such activities.

S.344 Business undertaking held as property

3. Commercial activities by registered non-profit organisation  Where the property held by a registered non-profit organisation includes a business undertaking, and where a claim is made that the income of any such undertaking is eligible for benefits under this Part, then the Assessing Officer shall have the power to determine the income of such business undertaking as per the provisions of this Act.

S.343 Deemed accumulated income 

(1) The regular income, as reduced by the application of income as per the provisions of section 341 and accumulated or set apart income under section 342, to the extent of 15% of regular income, shall be considered as deemed accumulated income and where such deemed accumulated income is invested or deposited, it shall be invested or deposited in any of the modes permitted under section 350.

(2) The deemed accumulated income under this section shall not be considered as accumulated income for the purposes of section 342.

S.348 Audit

Where the total income of a registered non-profit organisation, without giving effect to the provisions of this Part, exceeds the maximum amount which is not chargeable to income-tax in any tax year, the accounts of such registered non-profit organisation for that tax year shall be audited by an accountant and the person in receipt of the income shall be required to furnish a report of an audit of such income by such date in the prescribed form, duly signed and verified by such accountant and setting forth such particulars, as may be prescribed.

S.347 Books of account 

4. Compliances  Where the total income of a registered non-profit organisation, without giving effect to the provisions of this Part, exceeds the maximum amount which is not chargeable to income-tax in any tax year, such registered non-profit organisation shall be required to keep and maintain the books of account and other documents in such form and manner and at such place, as may be prescribed.

S.349 Return of income

Where the total income of a registered non-profit organisation, without giving effect to the provisions of this Part, exceeds the maximum amount which is not chargeable to income-tax in any tax year, it shall furnish the return of income for that tax year as per the provisions of section 263(1)(a)(iii) and (2), within the time limit allowed under section 263(1)(c) 1[or 263(4)].

S.352 Tax on accreted income

(1) Every specified person shall, in addition to the income-tax chargeable in respect of his total income, be liable to pay additional income-tax on accreted income at the maximum marginal rate in any of the cases specified in column B(i) and (ii) of the Table in sub-section (4).

(2) The accreted income referred to in sub-section (1) shall be computed using the following formula:--

A = B-C where,--

A = Accreted income;

B = Aggregate fair market value of the total assets of the specified person, as on the date specified, in column C of the Table in sub-section (4), computed in accordance with such method of valuation, as may be prescribed;

C = Total liability of such specified person, as on the date specified in column C of the said Table, computed in accordance with such method of valuation, as may be prescribed.

(3) The accreted income, computed as per the provisions of sub-section (2) shall be reduced by such amount of accreted income as

S.351 Specified violation

5. Violations  (1) The following shall constitute specified violation by a registered non-profit organisation:--

(a) where any income of the registered non-profit organisation has been applied, other than for its objects; or

(b) it carries out any commercial activity in contravention of the provisions of section 345 1[***]; or

(c) where it has applied any part of its total income for private religious purposes, which does not 2[enure] for the benefit of the public; or

(d) where a registered non-profit organisation, created or established after the commencement of this Act for charitable purpose, has applied any part of its income for the benefit of any particular religious community or caste other than the Scheduled Castes or the Scheduled Tribes or backward classes or women and children; or

(e) where any activity being carried out by the registered non-profit organisation is not genuine or is not being carried out in accordance with all or any of

S.353 Other violations

(1) Where any registered non-profit organisation--

(a) fails to maintain books of account under section 347; or

(b) fails to get books of account audited under section 348; or

(c) fails to furnish its return of income under section 349; or

(d) carrying out advancement of any other object of general public utility, carries out any commercial activity in contravention of the provisions of section 346, during any tax year, its regular income for such tax year as reduced by the expenditure referred to in sub-section (3) shall be taxable regular income which shall be chargeable to tax as per the provisions of section 334.

(2) Irrespective of the provisions of section 338, any the specified income and residual income of the registered non-profit organisation, which is not included in sub-section (1) shall also be chargeable to tax under the provisions of section 334.

(3) The expenditure referred to in sub-section (1) shall be the expenditure incu

S.350 Permitted modes of investment

(1) The modes of investing or depositing the money under this Part, shall be such as specified in Schedule XVI.

(2) The modes of investing or depositing money under this Part, other than the modes specified in Schedule XVI, shall be specified by the Central Government, by notification.

S.354 Application for approval for purpose of section 133(1)(b)(ii)

6. Approval for purpose of deduction under section 133(1)(b)(ii) (1) A registered non-profit organisation or a person referred to in Schedule VII (Table: Sl. No. 1) may, for the purpose of section 133(1)(b)(ii), make an application for approval in such form and manner, as may be prescribed, to the Principal Commissioner or Commissioner, subject to the following conditions:--

(a) it is not expressed to be for the benefit of any particular religious community or caste;

(b) it is established in India for a charitable purpose and does not incur any expenditure of an amount exceeding 5% of its total income during a tax year which is of a religious nature;

(c) the instrument under which it is constituted does not, or the rules governing it do not, contain any provision for the transfer at any time of the whole or any part of its assets for any purpose other than a charitable purpose;

(d) it maintains regular accounts of its receipts and expenditure;

(e)

S.354(a) Merger of register non-profit organisation in certain cases

1 [ 354A. Merger of register non-profit organisation in certain cases Where any registered non-profit organisation merges with any other registered non-profit organisation, the provisions of section 352 shall not apply if,--

(a) the other registered non-profit organisation has same or similar objects; and (b) the said merger fulfils such conditions as may be prescribed.]

-------------------------------------------

1. Inserted by Finance Act, 2026, w.e.f. 01.04.2026.

S.355 Interpretation

7. Interpretation  For the purposes of this Part,--

(a) "anonymous donation" means any voluntary contribution referred to in section 2(49)(c), where a person receiving such contribution does not maintain a record of the identity indicating the name and address of the person making such contribution and such other particulars, as may be prescribed;

(b) "approval" means an approval under the second proviso to section 80G(5) of the Income-tax Act, 1961 (43 of 1961) or section 354;

(c) "cancellation" includes withdrawal;

(d) "donation" means any voluntary contribution received by a registered non-profit organisation from any person;

(e) "commercial activity" means any activity in the nature of trade, commerce or business, or any activity of rendering any service in relation to any trade, commerce or business, for a cess or fee or any other consideration, irrespective of the nature of use or application, or retention, of the income from such activity;<

S.356 Appealable orders before Joint Commissioner (Appeals) 

1. Appeals to Joint Commissioner (Appeals) and Commissioner (Appeals)  (1) Any assessee or any deductor or any collector, aggrieved by any of the following orders of an Assessing Officer (below the rank of Joint Commissioner) may appeal to the Joint Commissioner (Appeals) against--

(a) an order being an intimation under section 270(1) or 399(1), where the assessee or deductor or collector objects to the adjustments made therein; or

(b) an order under section 270(10) or 271, where the assessee objects to the amount of income assessed, or to the amount of tax determined, or to the amount of loss computed, or to the status under which he is assessed; or

(c) an order of assessment, reassessment or recomputation under section 279; or

(d) an order under section 398; or

(e) an order imposing penalty under Chapter XXI; or

(f) an order under section 287 or 288 amending any of the orders or intimations mentioned in clauses (a) to (e).

(2) No a

S.358 Form of appeal and limitation 

(1) Every appeal under this Chapter shall be in such form and verified in such manner, as may be prescribed.

(2) An appeal referred to in sub-section (1), made to the Commissioner (Appeals) or to the Joint Commissioner (Appeals), shall be accompanied by a fee of--

(a) ₹ 250, where the total income of the assessee as computed by the Assessing Officer in the case to which the appeal relates is ₹ 100000 or less;

(b) ₹ 500, where the total income of the assessee, computed as aforesaid, in the case to which the appeal relates is more than ₹ 100000 but not more than ₹ 200000;

(c) ₹ 1000, where the total income of the assessee, computed as aforesaid, in the case to which the appeal relates is more than ₹ 200000;

(d) ₹ 250, where the subject matter of an appeal is not covered under clauses (a), (b) and (c).

(3) The appeal shall be presented within thirty days --

(a) from the date of service of the notice of demand where the appeal relates to

S.357 Appealable orders before Commissioner (Appeals)

Any assessee or any deductor or any collector, aggrieved by any of the following orders, may appeal to the Commissioner (Appeals) against--

(a) an order passed by a Joint Commissioner under section 231(4)(b); or

(b) an order against the assessee where the assessee denies his liability to be assessed under this Act; or

(c) an order being an intimation under section 270(1) or 399(1), where the assessee or the deductor or the collector objects to the adjustments made therein; or

(d) any order of assessment under section 270(10), except an order passed in pursuance of directions of the Dispute Resolution Panel or an order referred to in section 274(12) or 271, where the assessee objects to the income assessed, or to the amount of tax determined, or to the amount of loss computed, or to the status under which he is assessed; or

(e) an order of assessment, reassessment or recomputation under section 279 [except an order passed in pursuance of directions

S.361 Appellate Tribunal

2. Appeals to Appellate Tribunal.  (1) The Central Government shall constitute an Appellate Tribunal consisting of as many Judicial and Accountant Members as it thinks fit, to exercise the powers and discharge the functions conferred on the Appellate Tribunal by this Act.

(2) Irrespective of anything contained in this Act, the qualifications, appointment, term of office, salaries and allowances, resignation, removal and the other terms and conditions of service of the President, Vice-President and other Members of the Appellate Tribunal appointed,--

(a) after the commencement of the Tribunals Reforms Act, 2021 (33 of 2021), shall be governed by the provisions of Chapter II of the said Act;

(b) before the commencement of Part XIV of Chapter VI of the Finance Act, 2017(7 of 2017) , shall be governed by the provisions of the Income-tax Act, 1961 (43 of 1961) and the rules made thereunder, as if the provisions of section 184 of the Finance Act, 2017 (7 of 2017) had

S.363 Orders of Appellate Tribunal

(1) The Appellate Tribunal may, after giving both the parties to the appeal, an opportunity of being heard, pass such orders thereon as it thinks fit.

(2) The Appellate Tribunal may amend any order passed by it under sub-section (1) for the rectification of any mistake apparent from record, within six months from the end of the month in which the order was passed, if the mistake is brought to its notice by the assessee or the Assessing Officer.

(3) An amendment, as referred to in sub-section (2), which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made, unless the assessee has been allowed a reasonable opportunity of being heard.

(4) Any application filed by the assessee under sub-section (2) shall be accompanied by a fee of ₹ 50.

(5) In every appeal, the Appellate Tribunal, where it is possible, may hear and decide such appeal within four years from the end of the finan

S.362 Appeals to Appellate Tribunal 

(1) Any assessee, aggrieved by any of the following orders, may appeal to the Appellate Tribunal against such order--

(a) an order passed under this Act, by a Commissioner (Appeals) or a Joint Commissioner (Appeals); or

(b) an order passed by a Principal Commissioner or Commissioner under--

(i) section 332(7) or (8) or (9) or 351(2)(ii) or 354(3); or

(ii) section 377 or 439 or 465; or

(iii) section 287 amending any order as referred to in sub-clause (i) and (ii);

(c) an order passed by a Principal Chief Commissioner or Chief Commissioner or a Principal Director General or Director General or a Principal Director or Director under section 377 or 465 or an order passed under section 287 amending any such order; or

(d) an order passed by an Assessing Officer under section 270(10) or 279, in pursuance of the directions of the Dispute Resolution Panel or an order passed under section 287 in respect of such order; or

(e) an order pa

S.365 Appeal to High Court

3. Appeals to High Court  (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal, if the High Court is satisfied that the case involves a substantial question of law.

(2) The Principal Chief Commissioner or Chief Commissioner or the Principal Commissioner or Commissioner or an assessee aggrieved by any order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal under this sub-section shall be--

(a) filed within one hundred and twenty days from the date on which the order appealed against is received by the assessee or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner;

(b) in the form of a memorandum of appeal precisely stating therein the substantial question of law involved.

(3) The High Court may admit an appeal after the expiry of the period of one hundred and twenty days referred to in sub-section (2)(a), if it is satisfied th

S.364 Procedure of Appellate Tribunal 

(1) The powers and functions of the Appellate Tribunal may be exercised and discharged by Benches constituted by the President of the Appellate Tribunal from among the members thereof.

(2) Subject to the provisions contained in sub-section (3), a Bench shall consist of one Judicial Member and one accountant member.

(3) The President, or any other member of the Appellate Tribunal authorised in this behalf by the Central Government, may sitting singly, dispose of any case allotted to the Bench, pertaining to an assessee whose total income as computed by the Assessing Officer in the case does not exceed fifty lakh guids.

(4) The President of the Appellate Tribunal may, for the disposal of any particular case, constitute a Special Bench consisting of three or more members, one of whom shall necessarily be a judicial member and one an accountant member.

(5) If the members of a Bench differ in opinion on any point, the point shall be decided according to the o

S.360 Powers of Joint Commissioner (Appeals) or Commissioner (Appeals) 

(1) In disposing of an appeal, the Commissioner (Appeals) or the Joint Commissioner (Appeals), shall have the following powers:--

(a) in an appeal against an order of assessment, he may confirm, reduce, enhance or annul the assessment;

(b) where such appeal is against an order of assessment made under section 271, the Commissioner (Appeals) may set aside the assessment and refer the case back to the Assessing Officer for making a fresh assessment;

(c) in an appeal against the order of assessment for which the proceeding before the Settlement Commission abates under section 245HA of the Income-tax Act 1961 (43 of 1961), the Commissioner (Appeals) may, after taking into consideration all the material and other information produced by the assessee before, or the results of the inquiry held or evidence recorded by, the Settlement Commission, in the course of the proceeding before it and such other material as may be brought on his record, confirm, reduce, enhance o

S.359 Procedure in appeal 

(1) The Joint Commissioner (Appeals) or the Commissioner (Appeals) shall fix a day and place for the hearing of the appeal, and shall give notice of the same to the appellant and to the Assessing Officer against whose order the appeal is preferred.

(2) The following shall have the right to be heard at the hearing of the appeal:--

(a) the appellant, either in person or by an authorised representative;

(b) the Assessing Officer, either in person or by a representative.

(3) The Joint Commissioner (Appeals) or the Commissioner (Appeals) may--

(a) adjourn the hearing of the appeal; or

(b) make such further inquiry as he thinks fit, before disposing of any appeal, or may direct the Assessing Officer to make further inquiry and report the result of the same; or

(c) allow the appellant to go into any ground of appeal not specified in the grounds of appeal, if he is satisfied that the omission of that ground from the form of appeal was not wi

S.366 Case before High Court to be heard by not less than two Judges 

(1) When an appeal has been filed before the High Court under section 365, it shall be heard by a bench of not less than two Judges of the High Court, and shall be decided as per the opinion of such Judges or of the majority, if any, of such Judges.

(2) Where there is no such majority, the Judges shall state the point of law upon which they differ and the case shall then be heard upon that point only by one or more of the other Judges of the High Court and such point shall be decided according to the opinion of the majority of the Judges who have heard the case including those who first heard it.

S.368 Hearing before Supreme Court

(1) The provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the Supreme Court shall, so far as may be, apply in the case of appeals under section 367 as they apply in the case of appeals from decrees of a High Court.

(2) The costs of the appeal shall be at the discretion of the Supreme Court.

(3) Where the judgment of the High Court is varied or reversed in the appeal, effect shall be given to the order of the Supreme Court in the manner provided in section 365(10) in the case of a judgment of the High Court.

S.370 Execution for costs awarded by Supreme Court 

The High Court may, on petition made for the execution of the order of the Supreme Court in respect of any costs awarded thereby, transmit the order for execution to any court subordinate to the High Court.

S.402 Interpretation

For the purposes of this Chapter,--

(1) "Administrator" shall have the same meaning as assigned to it in section 2(a) of the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 (58 of 2002);

(2) "agricultural land" means agricultural land in India,--

(a) not being a land situated in any area referred to in section 2(22)(iii), for the purposes of section 393(1) [Table: Sl. No. 3(i)];

(b) including a land situated in any area referred to in section 2(22)(iii), for the purposes of section 393(1) [Table: Sl. No. 3(iii)];

(3) "an incorrect claim apparent from any information in the statement" shall mean a claim, on the basis of an entry, in the statement--

(a) of an item, which is inconsistent with another entry of the same or some other item in such statement;

(b) in respect of rate of deduction of tax at source or rate of collection of tax at source, where such rate is not as per the provisions of the Act;

(4) "aut

S.403 Liability for payment of advance tax 

(1) Advance tax shall be payable during any Financial year in respect of the current income of the assessee, as per the provisions of this Part.

(2) For the purposes of this Part, "current income" of a tax year means the total income of the assessee which would be chargeable to tax for such tax year.

(3) The provisions of sub-section (1) shall not apply to an individual resident in India, who--

(a) does not have any income chargeable under the head "Profits and gains of business or profession"; and (b) is of the age of sixty years or more at any time during the tax year.

S.396 Tax deducted is income received

The following sums shall be deemed as income received for the purposes of computing the income of an assessee--

(a) sums deducted under this Chapter; and (b) income-tax paid outside India by way of deduction in respect of which an assessee is allowed a credit against the tax payable under this Act, except tax paid under section 392(2)(a) and tax deducted as per section 393(3) (Table: Sl. No. 5).

S.404 Conditions of liability to pay advance tax 

Advance tax shall be payable by the assessee during a Financial year, where the amount of such tax payable during that year, as computed under this Part, is ₹10000 or more.

S.401 Bar against direct demand on assessee

Where tax is deductible at the source under this Chapter, the assessee shall not be called upon to pay the tax himself to the extent to which tax has been deducted from that income.

S.411 When tax payable and when assessee deemed in default 

(1) Any amount, otherwise than by way of advance tax, specified as payable in a notice of demand under section 289 at the place and to the person mentioned in the notice shall be paid within--

(a) thirty days of the service of the notice; or

(b) such period being a period less than thirty days, as specified in the notice with the previous approval of the Joint Commissioner, where the Assessing Officer has any reason to believe that it shall be detrimental to revenue if the full period of thirty days is allowed.

(2) Where any notice of demand has been served upon an assessee and any appeal or other proceeding, as the case may be, is filed or initiated in respect of the amount specified in the said notice of demand, then--

(a) such demand shall be deemed to be valid till the disposal of the appeal by the last appellate authority or disposal of the proceedings; and (b) any such notice of demand shall have the effect as specified in section 3 of the Taxation

S.407 Payment of advance tax by assessee in pursuance of order of Assessing Officer 

(1) Where a person has already been assessed for the total income of any tax year by way of regular assessment and the Assessing Officer is of the opinion that such person is liable to pay advance tax, he may require such person to pay advance tax on the specified sum, calculated in the manner laid down in section 405, by an order in writing, specifying the instalment or instalments in which such tax is to be paid, on or before the due date of each instalment specified in section 408.

(2) The order referred to in sub-section (1) may be passed at any time during the Financial year but not later than the last day of February of such Financial year and it shall be followed by issuance of notice of demand under section 289.

(3) In sub-section (1), "specified sum" means a sum, being higher of,--

(a) the total income of the latest tax year in respect of which the assessee has been assessed by way of regular assessment; or

(b) total income returned by the asses

S.405 Computation of advance tax

(1) The amount of advance tax payable by an assessee under section 404, on his own accord under section 406, or in pursuance of an order of an Assessing Officer under section 407, in the Financial year shall, subject to the provisions of sub-section (2), be computed as under--

A = B-C where,--

A = the amount of advance tax payable in a Financial year;

B = income-tax on the specified sum calculated at the rates in force in the Financial year, where "specified sum" shall have the meaning assigned to it in section 406 or 407;

C = amount of income-tax which would be deductible or collectible at source during the said Financial year under any provision of this Act from any income subject to the following:--

(a) such income is computed before allowing any deduction admissible under this Act and has been taken into account in computing the specified sum; and (b) (i) the person responsible for deducting tax has paid or credited such income after deduction

S.408 Instalments of advance tax and due dates 

(1) All the assessees who are liable to pay advance tax, other than the assessee referred to in sub-section (2), shall pay the same on the current income calculated in the manner laid down in section 405 in four instalments during each financial year and the due date of each instalment and the amount of such instalment shall be as specified in the Table below.

Table Sl. No. Due date of instalment Amount payable A B C

1. On or before the 15th June.

Not less than 15% of such advance tax.

2. On or before the 15th September.

Not less than 45% of such advance tax, as reduced by the amount, if any, paid in the earlier instalment.

3. On or before the 15th December.

Not less than 75% of such advance tax, as reduced by the amount or amounts, if any, paid in the earlier instalment or instalments.

4. On or before the 15th March.

The whole amount of such advance tax, as reduced by the amount or amounts, if any, paid in the earl

S.406 Payment of advance tax by assessee on his own accord 

(1) Every person, who is liable to pay advance tax under section 404 (whether or not he has been previously assessed by way of regular assessment) shall, on his own accord, pay advance tax on the specified sum, calculated in the manner laid down in section 405, at the appropriate percentage, on or before the due date of each instalment, as specified in section 408.

(2) A person who pays any instalment or instalments of advance tax under sub-section (1), may increase or reduce the amount of advance tax payable in the remaining instalment or instalments to accord with specified sum and the advance tax payable thereon, and make payment of the said tax in the remaining instalment or instalments accordingly.

(3) For the purposes of this section, the expression "specified sum" means current income as estimated by the assessee.

S.409 When assessee is deemed to be in default 

A person shall be deemed to be an assessee in default, if such person--

(a) does not pay on the date specified in section 408, any instalment of the advance tax that he is required to pay by an order of the Assessing Officer under section 407(1) and (4); or

(b) does not send to the Assessing Officer an intimation under section 407(8) on or before the date on which any such instalment as is not paid becomes due; or

(c) does not pay on the basis of his estimate of his current income, the advance tax payable by him under section 407(9), in respect of such instalment or instalments.

S.410 Credit for advance tax

Any sum, other than a penalty or interest, paid by or recovered from an assessee as advance tax in pursuance of this Part shall be treated as a payment of tax in respect of the income of the tax year in which it was payable, and credit therefor shall be given to such assessee in the regular assessment.

S.412 Penalty payable when tax in default

(1) When an assessee is in default or is deemed to be in default in making a payment of tax, he shall, in addition to the amount of the arrears and the amount of interest payable under section 411(3), be liable, by way of penalty, to pay--

(a) such amount as the Assessing Officer may direct; and (b) in the case of a continuing default, such further amount or amounts as the Assessing Officer may, from time to time, direct.

(2) The total amount of penalty under sub-section (1) shall not exceed the amount of tax in arrears.

(3) No penalty under sub-section (1) shall be levied--

(a) unless the assessee has been given a reasonable opportunity of being heard;

(b) where the assessee proves to the satisfaction of the Assessing Officer that the default was for good and sufficient reasons.

(4) The assessee shall not cease to be liable to any penalty under sub-section (1) merely by reason of the fact that before the levy of such penalty he has paid th

S.413 Certificate by Tax Recovery Officer and validity thereof 

(1) When an assessee is in default or is deemed to be in default in making a payment of tax, the Tax Recovery Officer may draw up under his signature a statement in such form as may be prescribed specifying the amount of arrears due from the assessee (such statement being herein and in sections 414 to 416 referred to as certificate) and shall proceed to recover from such assessee the amount specified in the certificate by one or more of the modes mentioned below, as per the rules prescribed in this regard,--

(a) attachment and sale of movable property of the assessee;

(b) attachment and sale of immovable property of the assessee;

1 [(c) appointing a receiver for the management of movable and immovable properties of the assessee.]

(2) The Tax Recovery Officer may take action under sub-section (1), whether or not proceedings for recovery of the arrears by any other mode have been taken.

(3) The assessee shall not be entitled to dispute the correctne

S.414 Tax Recovery Officer by whom recovery is to be effected

(1) For the purposes of section 413, the Tax Recovery Officer shall be--

(a) the Tax Recovery Officer within whose jurisdiction the assessee carries on his business or profession or has the principal place of his business or profession; or

(b) the Tax Recovery Officer within whose jurisdiction the assessee resides or any of his movable or immovable property is situated, the jurisdiction for this purpose being the jurisdiction assigned to the Tax Recovery Officer under the orders or directions issued by the Board, or by any income-tax authority not below the rank of Commissioner who is authorised in this behalf by the Board in pursuance of section 241.

(2) Where an assessee has property within the jurisdiction of more than one Tax Recovery Officer and the Tax Recovery Officer by whom the certificate is drawn up--

(a) is not able to recover the entire amount by sale of the property, movable or immovable, within his jurisdiction; or

(b) is of the opi

S.415 Stay of proceedings in pursuance of certificate and amendment or cancellation thereof

(1) The Tax Recovery Officer may grant time for the payment of any tax and, till the expiry of such time, shall stay the recovery proceedings for such tax.

(2) Where a certificate has been drawn up and subsequently, the amount of the outstanding demand is reduced as a result of the order giving rise to the said demand, being modified in an appeal or other proceeding under this Act, the Tax Recovery Officer shall--

(a) if the order is the subject-matter of further proceeding under this Act, stay the recovery of such part of the amount specified in the certificate as pertains to the said reduction for the period for which the appeal or other proceeding remains pending; or

(b) if the order which was the subject-matter of such appeal or other proceeding has become final and conclusive, amend the certificate, or cancel it.

S.416 Other modes of recovery

(1) Where no certificate has been drawn up under section 413, the Assessing Officer may recover the tax by any one or more of the modes provided in this section.

(2) Where a certificate has been drawn up under section 413, the Tax Recovery Officer may, without prejudice to the modes of recovery specified in that section, recover the tax by any one or more of the modes provided in this section.

(3) If any assessee is in receipt of any income chargeable under the head "Salaries", the Assessing Officer or Tax Recovery Officer may require any person paying the same to deduct from any payment subsequent to the date of such requisition any arrears of tax due from such assessee and such person shall comply with the said requisition and shall pay the sum so deducted to the credit of the Central Government or as the Board directs.

(4) Nothing contained in sub-section (3) shall apply to any part of the salary exempted from attachment in execution of a decree of a civil c

S.418 Recovery of tax in pursuance of agreements with foreign countries 

(1) Where an agreement is entered into by the Central Government with the Government of any country outside India for recovery of income-tax under this Act and the corresponding law in force in that country and the Government of that country or any authority under that Government which is specified in this behalf in such agreement sends to the Board a certificate for the recovery of any tax due under such corresponding law from--

(a) a resident; or

(b) a person having any property in India, the Board may forward such certificate to any Tax Recovery Officer having jurisdiction over the resident, or within whose jurisdiction such property is situated and thereupon such Tax Recovery Officer shall--

(i) proceed to recover the amount specified in the certificate in the manner in which he would proceed to recover the amount specified in a certificate drawn up by him under section 413; and (ii) remit any sum so recovered by him to the Board after deducting his expense

S.417 Recovery through State Government 

If the recovery of tax in any area has been entrusted to a State Government under article 258(1) of the Constitution, the State Government may direct, with respect to that area or any part thereof that tax shall be recovered therein with, and as an addition to, any municipal tax or local rate, by the same person and in the same manner as the municipal tax or local rate is recovered.

S.419 Recovery of penalties, fine, interest and other sums 

Any sum imposed by way of interest, fine, penalty, or any other sum payable under the provisions of this Act, shall be recoverable in the manner provided in this Part for the recovery of arrears of tax.

S.377 Revision of orders prejudicial to revenue 

(1) The Competent Authority may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer or the Transfer Pricing Officer, as the case may be, is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including--

(a) an order enhancing or modifying the assessment or cancelling the assessment and directing a fresh assessment;

(b) an order modifying the order under section 166; or

(c) an order cancelling the order under section 166 and directing a fresh order under the said section.

(2) For the purpose of sub-section (1),--

(a) an order passed by the Assessing Officer or the Transfer Pricing Officer, shall include--

(i) an order of assessmen

S.378 Revision of other orders

(1) The Competent Authority may, for any order, other than an order to which section 377 applies, passed by an authority subordinate to him, either of his own motion or on an application by the assessee for revision,--

(a) call for the record of any proceeding under this Act in which any such order has been passed;

(b) make such inquiry or cause such inquiry to be made; and (c) subject to the provisions of this Act, pass such order thereon, not being an order prejudicial to the assessee, as he thinks fit.

(2) The Competent Authority shall not of his own motion revise any order under this section if the order has been made more than one year previously.

(3) An application for revision under this section shall be made by the assessee, within one year from the date on which the order in question was communicated to him or the date on which he otherwise came to know of it, whichever is earlier.

(4) The Competent Authority may, if he is satisfied that

S.379 Dispute Resolution Committee

1. Dispute Resolution Committee in certain cases  (1) The Central Government shall constitute, one or more Dispute Resolution Committees, as per the rules made under this Act, for dispute resolution in the case of such persons or class of persons, as specified by the Board, who opt for dispute resolution under this Chapter in respect of dispute arising from any variation in the specified order in his case and who fulfils the specified conditions, as may be prescribed.

(2) The Dispute Resolution Committee, subject to the conditions as may be prescribed, may make modifications to the variations in specified order or reduce or 1[waive any penalty imposed or imposable] under this Act, or grant immunity from prosecution for any offence punishable under this Act, in case of a person whose dispute is resolved under this Chapter.

(3) Irrespective of anything contained in section 275, upon receipt of the order of the Dispute Resolution Committee under this section, the Assessi

S.380 Interpretation

2. Advance rulings  For the purposes of this Chapter,--

(a) "advance ruling" means--

(i) a determination by the Board for Advance Rulings in relation to a transaction which has been undertaken or is proposed to be undertaken by a non-resident applicant; or

(ii) a determination by the Board for Advance Rulings in relation to the tax liability of a non-resident arising out of a transaction which has been undertaken or is proposed to be undertaken by a resident applicant with such non-resident; or

(iii) a determination by the Board for Advance Rulings in relation to the tax liability of a resident applicant, arising out of a transaction which has been undertaken or is proposed to be undertaken by such applicant; and such determination shall include the determination of any question of law or of fact specified in the application; or

(iv) a determination or decision by the Board for Advance Rulings in respect of an issue relating to computation of tota

S.381 Board for Advance Rulings 

(1) The Central Government shall constitute one or more Boards for Advance Rulings, as may be necessary, for giving advance rulings under this Chapter on or after such date as the Central Government may, by notification, appoint.

(2) The Board for Advance Rulings shall consist of two members, each being an officer not below the rank of Chief Commissioner, as may be nominated by the Board.

S.393 Tax to be deducted at source 

(1) Where any income or sum of the nature specified in column B of the Table below, is credited or paid or distributed by the person specified in column C during the tax year, to a resident, the person responsible for paying such income or sum shall deduct income-tax--

(a) on the entire amount of such income or sum, where the amount or aggregate of amounts exceeds the threshold limit specified in column D, or on sum as per Note 1 for serial number 8(ii), as the case may be;

(b) at the rate specified in column D;

(c) at the time of credit of such income or sum to the account of the payee or at the time of its payment in cash or by way of a cheque or a draft or by any other mode, whichever is earlier; and (d) subject to the provisions of sub-sections (4), (5), (6), (8) and (9).

Table For payments to resident Sl. No. Nature of Income or sum Payer Rate Threshold limit A B C D

1. Commission or brokerage (i) Any income by way of remuneration or reward

S.394 Collection of tax at source

(1) Every person, as specified in column C of the Table below shall collect tax--

(a) on receipts specified in column B;

(b) at the rate as specified in column D; and (c) at the time of debiting of the amount payable by the buyer or licensee or lessee to the account of the buyer or licensee or lessee or at the time of receipt of such amount from the said buyer or licensee or lessee in cash or by way of a cheque or a draft or any other mode, whichever is earlier.

Table Tax collection at source Sl. No. Nature of receipt Person Rate of Tax Collected at Source A B C D

1. Sale of alcoholic liquor for human consumption.

Seller.

1 [2%]

2. Sale of tendu leaves.

Seller.

2 [2%]

3. Sale of timber whether obtained under a forest lease or otherwise; or any other forest produce (not being timber or tendu leaves) obtained under a forest lease.

Seller.

2%

4. Sale of scrap.

Seller.

1 [2%]<

S.392 Salary and accumulated balance due to an employee 

(1) Any person responsible for paying any income chargeable under the head "Salaries" shall deduct income-tax on the amount payable and this deduction shall be made at the time of such payment at the average rate of income-tax computed on the basis of the rates in force for the tax year in which the payment is made, on the estimated income of the assessee under this head for such year.

(2) (a) Without prejudice to the provisions of sub-section (1), the person responsible for paying any income in the nature of a non-monetary perquisite chargeable to tax under section 17(1), may pay, at his option, tax on the whole or part of such income without making any deduction therefrom, at the time when such tax was deductible under sub-section (1);

(b) the tax under clause (a) shall be determined at the average rate as per sub-section (1), on the income chargeable under the head "Salaries" including the income referred to in the said clause, and shall be construed as if it were

S.390 Deduction or collection at source and advance payment 

(1) The tax on income shall be payable as per this Chapter by way of--

(a) deduction or collection at source; or

(b) advance payment; or

(c) payment under section 392(2)(a).

(2) The tax referred to in sub-section (1) shall be payable as per the provisions of this Chapter, irrespective of the fact that the assessment in respect of such income is to be made in a later tax year.

(3) Nothing contained in this section, shall affect the charge of tax on such income under section 4(1).

(4) The payment of tax referred to in sub-section (1) shall be in addition to any other mode of tax recovery to discharge the liability in respect of income assessed for a tax year.

(5) The tax deducted at source or collected at source or sum referred to in section 392(2)(a) under this Chapter and paid to the Central Government shall be treated as payment of tax on behalf of the person--

(a) from whose income such tax has been deducted; or

(b) f

S.391 Direct payment

(1) The income-tax on any income shall be payable directly by the assessee if--

(a) there is no provision under this Chapter to deduct income-tax on such income at the time of payment; or

(b) income-tax has not been deducted as per the provisions of this Chapter.

(2) If an assessee has any income of the nature as specified in section 17(1)(d) and such specified security or sweat equity shares are allotted or transferred directly or indirectly by the current employer which is an eligible start-up referred to in section 140, then direct payment of tax for the purposes of sub-section (1) shall be made in accordance with in section 289(3).

(3) Where any person, including the principal officer of the company,--

(a) who is required to deduct any sum as per the provisions of this Act; or

(b) referred to in section 392(2)(a), being an employer, does not deduct, or after so deducting fails to pay, or does not pay, the whole or any part of the tax, a

S.389 Appeal

(1) The applicant, if aggrieved by any ruling pronounced or order passed by the Board for Advance Rulings or the Assessing Officer, on the directions of the Principal Commissioner or Commissioner, may appeal to the High Court against such ruling or order of the Board for Advance Rulings within sixty days from the date of the communication of that ruling or order, in such form and manner, as may be prescribed.

(2) Where the High Court is satisfied, on an application made by the appellant in this behalf, that the appellant was prevented by sufficient cause from presenting the appeal within the period specified in sub-section (1), it may grant further period of thirty days for filing such appeal.

S.376 Procedure where an identical question of law is pending before High Courts or Supreme Court

(1) Irrespective of anything contained in this Act, where the collegium is of the opinion that--

(a) any question of law arising in the case of an assessee for any tax year (such case being herein referred to as the relevant case) is identical with a question of law arising,--

(i) in his case for any other tax year; or

(ii) in the case of any other assessee for any tax year; and (b) such question of law is pending before the jurisdictional High Court in an appeal under section 260A of Income-tax Act, 1961 (43 of 1961) or section 365 of this Act or the Supreme Court in an appeal under section 261 of the Income-tax Act, 1961 (43 of 1961) or section 367 of this Act or in a reference under section 256 of Income-tax Act, 1961 (43 of 1961) before the Jurisdictional High Court or in a reference before the Supreme Court under section 261 of Income-tax Act, 1961 (43 of 1961) or in a Special Leave Petition under article 136 of the Constitution, against the order of the A

S.375 Procedure when assessee claims identical question of law is pending before High Court or Supreme Court 

(1) Irrespective of anything contained in this Act, where an assessee claims that--

(a) any question of law arising in his case for a tax year pending before the Assessing Officer or any appellate authority (such case being herein referred to as the relevant case) is identical with a question of law arising in his case for another tax year (such case being herein referred to as the other case); and (b) such question of law for such other case is pending--

(i) before the High Court on a reference under section 256 or on an appeal under section 260A of the Income-tax Act, 1961 (43 of 1961); or

(ii) before the Supreme Court on a reference under section 257 or on an appeal under section 261 of the Income-tax Act, 1961 (43 of 1961); or

(iii) before the High Court on an appeal made under section 365; or

(iv) before the Supreme Court on appeal made under section 367; or

(v) in a Special Leave Petition under article 136 of the Constitution, against

S.373 Filing of appeal by income-tax authority

(1) The Board may, from time to time, issue orders, instructions or directions to other income-tax authorities, fixing such monetary limits as it may deem fit, for the purpose of regulating filing of appeal by any income-tax authority under the provisions of this Chapter.

(2) Where, in pursuance of the orders, instructions or directions issued under sub-section (1), an income-tax authority has not filed any appeal on any issue in the case of an assessee for any tax year, it shall not preclude such authority from filing an appeal on the same issue in the case of--

(a) the same assessee for any other tax year; or

(b) any other assessee for the same or any other tax year.

(3) Where no appeal has been filed by an income-tax authority pursuant to the orders or instructions or directions issued under sub-section (1), it shall not be lawful for an assessee, being a party in any appeal, to contend that the income-tax authority has acquiesced in the decision on t

S.374 Interpretation of "High Court" 

For the purposes of this Chapter, "High Court" means,--

(i) for any State, the High Court for that State;

(ii) for the Union territory of Jammu and Kashmir, the High Court of Jammu and Kashmir and Ladakh;

(iii) for the Union territory of Ladakh, the High Court of Jammu and Kashmir and Ladakh;

(iv) for the Union territory of the Andaman and Nicobar Islands, the High Court at Calcutta;

(v) for the Union territory of Lakshadweep, the High Court of Kerala;

(vi) for the Union territory of Chandigarh, the High Court of Punjab and Haryana;

(vii) for the Union territories of Dadra and Nagar Haveli and Daman and Diu, the High Court at Bombay;

(viii) for the Union territory of Puducherry, the High Court at Madras; and (ix) for the National Capital Territory of Delhi, the High Court of Delhi.

S.371 Amendment of assessment on appeal 

If as a result of an appeal under section 356 or 357 or 362, any change is made in the assessment of a body of individuals or an association of persons, or a new assessment is directed in such cases, the Joint Commissioner (Appeals) or the Commissioner (Appeals) or the Appellate Tribunal, shall pass an order authorising the Assessing Officer either to amend the assessment made on any member of the body or association or to make a fresh assessment on such member.

S.372 Exclusion of time taken for copy 

In computing the period of limitation prescribed for an appeal or an application under this Act, the day on which the order complained of was served and, if the assessee was not provided with a copy of the order when the notice of the order was served, the time required to obtain a copy of such order, shall be excluded.

S.369 Tax to be paid irrespective of appeal, etc 

5. General  Irrespective of the fact that an appeal has been preferred to the High Court or the Supreme Court, tax shall be payable as per the assessment made in the case.

S.367 Appeal to Supreme Court

4. Appeals to Supreme Court  An appeal shall lie to the Supreme Court from any judgment of the High Court delivered on an appeal made to High Court in respect of an order passed under section 363 in any case which the High Court certifies to be fit for appeal to the Supreme Court.

S.384 Procedure on receipt of application 

(1) On receipt of an application, the Board for Advance Rulings shall forward a copy thereof to the Principal Commissioner or Commissioner and, call upon him to furnish the relevant records, which shall be returned at the earliest opportunity.

(2) The Board for Advance Rulings may, after examining the application and the records called for either allow or reject the application by an order.

(3) For the purposes of sub-section (2), an application shall be rejected if the question raised therein--

(a) is already pending before any income-tax authority or Appellate Tribunal except in the case of a resident applicant falling under section 380(b)(iii) or any court;

(b) involves determination of fair market value of any property;

(c) relates to a transaction or issue which is designed prima facie for the avoidance of income-tax except in the case of a resident applicant falling in section 380(b)(iii) or in the case of an applicant falling under section

S.386 Advance ruling to be void in certain circumstances

(1) Where on a representation made by the Principal Commissioner or Commissioner or otherwise, the Board for Advance Rulings finds, that an advance ruling pronounced under section 384(6) has been obtained by the applicant by fraud or misrepresentation, then it may by order, declare such ruling to be void ab initio and thereupon, all the provisions of this Act shall apply (after excluding the period beginning with the date of such advance ruling and ending with the date of order under this sub-section) to the applicant as if such advance ruling had never been made.

(2) A copy of the order made under sub-section (1) shall be sent to the applicant and the Principal Commissioner or Commissioner.

S.387 Powers of the Board for Advance Rulings 

(1) The Board for Advance Rulings shall, for the purpose of exercising its powers, have all the powers of a civil court under the Code of Civil Procedure, 1908 (5 of 1908) as are referred to in section 246 of this Act.

(2) The Board for Advance Rulings shall be deemed to be a civil court for the purposes of section 215 but not for the purposes of Chapter XXVIII of the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023) and every proceeding before the Board for Advance Rulings shall be deemed to be a judicial proceeding under sections 229 and 267 and for the purposes of section 233 of the Bharatiya Nyaya Sanhita, 2023 (45 of 2023).

S.383 Application for advance ruling

(1) An applicant desirous of obtaining an advance ruling under this Chapter, may make an application in such form and manner, as may be prescribed, stating the question on which the advance ruling is sought.

(2) The application shall be accompanied by a fee, as may be prescribed.

(3) An applicant may withdraw an application within thirty days from the date of the application.

S.385 Appellate authority not to proceed in certain cases 

No income-tax authority or the Appellate Tribunal shall proceed to decide any issue for which an application has been made by an applicant, being a resident, under section 383(1).

S.382 Vacancies, etc., not to invalidate proceedings 

No proceeding before, or pronouncement of advance ruling by, the Board for Advance Rulings, shall be questioned or shall be invalid on the ground merely of the existence of any vacancy or defect in the constitution of the Board for Advance Rulings.

S.388 Procedure of Board for Advance Rulings 

The Board for Advance Rulings shall, subject to the provisions of this Chapter, have power to regulate its own procedure in all matters arising out of the exercise of its powers under this Act.

S.397 Compliance and reporting 

(1) (a) Every person deducting or collecting tax shall apply for allotment of a tax deduction and collection account number to the Assessing Officer within such time as may be prescribed, if that person has not already been allotted such number;

(b) where a tax deduction and collection account number has been allotted to a person, such person shall quote such number in all challans, statements, certificates referred to in this Chapter, and in all documents pertaining to such transactions as may be prescribed in the interests of revenue;

1 [(c) the provisions of clause (a) shall not apply to--

(i) a person in respect of a transaction where he is required to deduct tax under section 393(1) [Table: Sl. No. 2(i), 3(i) or 6(ii)]; or

(ii) a person referred to in section 393(4) [Table: Sl. No. 12.C(a)] in respect of a transaction where he is required to deduct tax on consideration for transfer of a virtual digital asset under section 393(1) [Table: Sl. No. 8(vi

S.395 Certificates

(1) Where tax is required to be deducted on any income or sum under this Chapter, then subject to the rules made under this Act,--

(a) the payee may make an application before the Assessing Officer for deduction of income-tax at a lower rate or no deduction of income-tax, as the case may be; and (b) the Assessing Officer on being satisfied that the total income of the payee justifies deduction of income-tax at a lower rate or no deduction of income-tax, as the case may be, shall issue to him a certificate as appropriate; and 1 [(c) when a certificate is issued under clause (b) or sub-section (6), as the case may be, the person responsible for paying the income or sum shall deduct the tax at the rate specified in such certificate, or deduct no income-tax, as the case may be, till its validity.]

(2) (a) The person responsible for paying to a non-resident any sum as mentioned in section 393(2) (Table: Sl. No. 17), may make an application to the Assessing Officer in such

S.398 Consequences of failure to deduct or pay or, collect or pay 

(1) If a person, including the principal officer of a company,--

(a) who is required to deduct or collect any amount under this Act; or

(b) referred to in section 392(2)(a), being an employer, does not deduct or pay, or does not collect or pay, or after so deducting or collecting fails to pay, the whole or any part of the tax, as required by or under this Act, then such person shall be deemed to be an assessee in default in respect of such tax in addition to any other consequences which that person may incur under this Act.

(2) Irrespective of anything contained in sub-section (1), any person,--

(a) including the principal officer of a company, who fails to deduct; or

(b) responsible for collecting tax as per section 394(1) (Table: Sl. Nos. 1 to 5 and 9), who fails to collect, the whole or any part of the tax, as required under this Chapter, on the amount paid or credited to the account of payee or, on the amount collected or debited to the accoun

S.400 Power of Central Government to relax provisions of this Chapter 

(1) The Central Government may, by notification provide that deduction or collection of tax shall not be made or is to be made at such lower rate, from such payment or receipt and in respect of such person or class of persons.

1 [(2) The Board may, with the previous approval of the Central Government, issue guidelines to remove any difficulty arising in giving effect to the provisions of this Chapter and such guidelines shall be--

(a) binding on the income-tax authorities and on the person liable to deduct or, as the case may be, collect income-tax; and (b) laid before each House of Parliament.]

(3) The Board may notify, a class of person, or cases, where the person responsible for paying to a non-resident, not being a company, or to a foreign company, any sum, whether or not chargeable under the provisions of this Act, to make an application in such form and manner as may be prescribed, to the Assessing Officer, to determine the appropriate proportion of sum c

S.399 Processing

(1) All statements of tax deducted at source or tax collected at source including a correction statement shall be processed in the following manner:--

(a) the amounts deductible or collectible under this Chapter shall be computed after making the following adjustments:--

(i) any arithmetical error in the statement; or

(ii) an incorrect claim apparent from any information in the statement;

(b) the interest, if any, shall be computed on the basis of the amounts deductible or collectible as reflected in the statement;

(c) the fee, if any, shall be computed as per the provisions of section 1[427(1) and (2)];

(d) (i) the amount payable by; or

(ii) the amount of refund due to, the deductor or collector shall be determined after adjustment of the amount computed under clauses (b) and (c) against any amount paid under section 397(3) or 398 or 1[427(1) and (2)] and any amount paid otherwise by way of tax or interest or fee;

(e) an inti

S.420 Tax clearance certificate

(1) Subject to such exceptions as the Central Government may, by notification, specify in this behalf, no person,--

(a) who is not domiciled in India;

(b) who has come to India in connection with business, profession or employment; and (c) who has income derived from any source in India, shall leave the territory of India by land, sea or air unless he furnishes to such authority as may be prescribed--

(i) an undertaking in the prescribed form from his employer; or

(ii) through whom such person is in receipt of the income, to the effect that tax payable by such person who is not domiciled in India shall be paid by the employer referred to in clause (i) or the person referred to in clause (ii), and the prescribed authority shall, on receipt of the undertaking, immediately give to such person a no objection certificate, for leaving India.

(2) Nothing contained in sub-section (1) shall apply to a person who is not domiciled in India but visits India a

S.421 Recovery by suit or under other law not affected 

Section 421 - 

The several modes of recovery specified in this Part shall not affect in any way:--

(a) any other law for the time being in force relating to the recovery of debts due to Government; or

(b) the right of the Government to institute a suit for the recovery of the arrears due from the assessee, and it shall be lawful for the Assessing Officer or the Government, as the case may be, to have recourse to any such law or suit, irrespective of the fact that the tax due is being recovered from the assessee by any mode specified in this Part of the Chapter.

S.422 Recovery of tax arrear in respect of non-resident from his assets

Irrespective of anything contained in section 304(1) or (5), where the person entitled to the income referred to in section 9(2) is a non-resident, the tax chargeable thereon, whether in his name or in the name of his agent who is liable as a representative assessee--

(a) may be recovered by deduction under the provisions of Chapter XIX-B; and (b) any arrears of tax may also be recovered as per the provisions of this Act from any assets of the non-resident which are, or may at any time come, within India.

S.425 Interest for deferment of advance tax

Section 425 - Interest for deferment of advance tax (1) Where in any tax year, an assessee, liable to pay advance tax under section 404, other than the assessee mentioned in sub-section (3), has failed to pay such tax, or the advance tax paid by the assessee on its current income on or before the date specified in column B of the Table below, is less than advance tax due on returned income, as specified in column C, then the assessee shall be liable to pay interest on the amount of Shortfall of advance tax as specified in column D, at the rate of interest specified in column E:--

Table Sl. No. Due date of Instalment Advance tax due on returned income Amount of Shortfall of advance tax being advance tax due as per column C, as reduced by advance tax already paid on or before the date specified in column B Interest payable on Shortfall as specified in column D A B C D E

1. 15 th day of June.

15% of the tax due on returned income.

Shortfall till 15th day o

S.424 Interest for defaults in payment of advance tax

Section 424 - 

(1) Subject to the other provisions of this section, where, in any tax year, an assessee who is liable to pay advance tax under section 404,--

(a) has failed to pay such tax; or

(b) the advance tax paid by such assessee under the provisions of section 406 or 407 is less than 90% of the assessed tax, the assessee shall be liable to pay simple interest at the rate of 1% for every month or part of a month, for the period, beginning from the 1st April following such tax year--

(i) upto the date of determination of total income under section 270(1); and (ii) upto the date of completion of regular assessment, where a regular assessment is made, on an amount equal to the assessed tax in case where clause (a) is applicable or, on the amount by which the advance tax paid as aforesaid falls short of the assessed tax in case where clause (b) is applicable.

(2) In sub-section (1), "assessed tax" means the tax on the total income determined unde

S.423 Interest for defaults in furnishing return of income 

(1) Where the return of income for any tax year is furnished after the due date or is not furnished, the assessee shall be liable to pay simple interest as per the following formula:--

I = 1% x A x T where,--

I = the interest payable;

A = the amount of tax on which interest is payable, as specified in sub-section (2);

T = number of months comprised in the period commencing on the date immediately following the starting date and ending on the end date, both specified in sub-section (2).

(2) For sub-section (1), in respect of the circumstances specified in column B of the Table below, the starting date shall be the date specified in column C, the ending date shall be the date as specified in column D and the amount of tax on which interest is payable is specified in column E.

Table Sl. No. Circumstances Starting date Ending date The amount of tax on which interest is payable A B C D E

1. Where the return is furnished under section 263

S.428 Fee for default in furnishing return of income, audited accounts and reports

1 [428. Fee for default in furnishing return of income, audited accounts and reports Without prejudice to the provisions of this Act, where any person--

(a) required to furnish a return of income under section 263, fails to do so within the due date, as specified under sub-section (1) of the said section, he shall be liable to pay by way of fee,--

(i) a sum of ₹ 1000, if the total income of such person does not exceed ₹ 500000; and (ii) a sum of ₹ 5000, in any other case;

(b) furnishes a return of income under section 263(5) beyond nine months from the end of relevant tax year, he shall be liable to pay by way of fee,--

(i) a sum of ₹ 1000, if the total income of such person does not exceed ₹ 500000; and (ii) a sum of ₹ 5000, in any other case;

(c) fails to get his accounts audited for any tax year or years and furnish the report of such audit as required under section 63, he shall be liable to pay by way of fee,--

(i) a sum of ₹ 75000 for

S.427 Fee for default in furnishing statements

1 [(1) Without prejudice to the provisions of this Act, where any person fails to deliver or cause to be delivered a statement as per section 397(3)(b) within the time prescribed therein, he shall be liable to pay by way of fee, a sum of ₹ 200 for every day for which such failure continues.

(2) The amount of fee referred to in sub-section (1) shall--

(a) not exceed the amount of tax deductible or collectible; and (b) be paid before delivering or causing to be delivered the statement, as per sub-section (1).

(3) Without prejudice to the provisions of this Act, where any person who is required to furnish a statement of financial transaction or reportable account under section 508(1), fails to furnish such statement within the time prescribed under section 508(2), he shall be liable to pay by way of fee, a sum of ₹ 200 for every day for which such failure continues and such fee shall not exceed a sum of ₹ 100000]

----------------------------------

1.

S.116 Treatment of accumulated losses and unabsorbed depreciation in amalgamation or demerger, etc 

(1) Where there has been an amalgamation of,--

(a) a company owning an industrial undertaking or a ship or a hotel with another company; or

(b) a banking company referred to in section 5(c) of the Banking Regulation Act, 1949 (10 of 1949) with a specified bank; or

(c) one or more public sector company with one or more other public sector company; or

(d) an erstwhile public sector company with one or more company or companies, if the share purchase agreement entered into under strategic disinvestment restricted immediate amalgamation of the said public sector company and the amalgamation is carried out within five years from the end of the tax year in which the restriction on amalgamation in the share purchase agreement ends, then, irrespective of anything contained in any other provision of this Act, the accumulated loss and unabsorbed depreciation of the amalgamating company shall be deemed to be the loss or, allowance for unabsorbed depreciation of the

S.113 Set off and carry forward of losses computed in respect of speculation business

(1) Any loss, computed in respect of a speculation business carried on by the assessee shall be set off only against profits and gains of another speculation business.

(2) Where for any tax year, loss computed in respect of a speculation business cannot be wholly set off under sub-section (1), so much of the loss not so set off or the whole loss, as the case may be, shall be carried forward to the following tax year and--

(i) be set off against the profits and gains, if any, of any speculation business carried on by him for such tax year; and (ii) if the loss cannot be wholly so set off, the amount of loss not so set off shall be carried forward to the following tax year and so on.

(3) No loss shall be carried forward under this section for more than four tax years immediately succeeding the tax year for which the loss was first computed.

(4) Where any allowance of part thereof under section 33(11) or 45(7) related to the speculation business is to be ca

S.115 Set off and carry forward of losses from specified activity

(1) Any loss incurred by the assessee in specified activity in any tax year shall be set off only against income from specified activity.

(2) Where for any tax year, loss computed in respect of a specified activity cannot be wholly set off under sub-section (1), so much of the loss not so set off or the whole loss, as the case may be, shall be carried forward to the following tax year and--

(i) be set off against the income, if any, of the specified activity carried on by him for such tax year; and (ii) if the loss cannot be wholly so set off, the amount of loss not so set off shall be carried forward to the following tax year and so on.

(3) No loss shall be carried forward under this section for more than four tax years immediately succeeding the tax year for which the loss was first computed.

(4) For the purposes of this section--

(a) "horse race" means a horse race upon which wagering or betting may be lawfully made;

(b) "income by way o

S.114 Set off and carry forward of losses computed in respect of specified business

(1) Any loss, computed in respect of a specified business, referred to in section 46, shall be set off only against profits and gains of another specified business.

(2) Where for any tax year, loss computed in respect of a specified business cannot be wholly set off under sub-section (1), so much of the loss not so set off or the whole loss, as the case may be, shall be carried forward to the following tax year and--

(i) be set off against the profits and gains, if any, of any specified business carried on by him for such tax year; and (ii) if the loss cannot be wholly so set off, the amount of loss not so set off shall be carried forward to the following tax year and so on.

S.119 Carry forward and set off of losses not permissible in certain cases 

(1) In case of change in constitution of a firm during a tax year, nothing in this Chapter shall entitle the firm to have carried forward and set off so much of the loss proportionate to the share of a retired or deceased partner as exceeds his share of profits, if any, in the firm in respect of the tax year.

(2) If any person carrying on any business or profession has been succeeded in such capacity by another person, otherwise than by inheritance, nothing in this Chapter shall entitle any person other than the person incurring the loss to have it carried forward and set off against his income.

(3) Irrespective of anything contained in this Chapter, in case of a change in shareholding during the tax year of a company (not being a company in which the public are substantially interested),--

(a) no loss incurred in any year prior to the tax year shall be carried forward and set off against the income of the tax year unless on the last day of the tax year, the sh

S.118 Carry forward and set off of losses and unabsorbed depreciation in business re-organisation of co-operative banks

(1) The assessee, being a successor co-operative bank, shall, in a case where the amalgamation has taken place during the tax year, be allowed to set off the accumulated loss and the unabsorbed depreciation, if any, of the predecessor co-operative bank as if the amalgamation had not taken place, and all the other provisions of this Act relating to set off and carry forward of loss and allowance for depreciation shall apply accordingly.

(2) In case of a co-operative bank where demerger takes place during the tax year, and where the accumulated loss or unabsorbed depreciation of the demerged co-operative bank--

(a) is directly relatable to the undertaking transferred, the whole of such accumulated loss or unabsorbed depreciation shall be allowed to be carried forward and set off against the income of the resulting co-operative bank; and (b) is not directly relatable to the undertaking transferred, then such accumulated loss or unabsorbed depreciation shall first be appo

S.120 No set off of losses against undisclosed income consequent to search, requisition and survey

(1) Irrespective of anything contained in any other provision of this Act, any loss, whether brought forward or otherwise or unabsorbed depreciation, shall not be allowed to be set off against any undisclosed income which is included in the total income of any tax year, consequent to a search conducted under section 247 or a requisition under section 248 or a survey conducted under section 253, not being a survey under section 253(4).

(2) For the purposes of this section, the expression "undisclosed income" for any tax year shall have the meaning as referred to in section 301.

S.239 Instructions to subordinate authorities

(1) The Board may issue such orders, instructions and directions to other income-tax authorities as it considers fit for the proper administration of this Act, and such authorities and all other persons employed in the execution of this Act shall observe and follow such orders, instructions and directions.

(2) No orders, instructions or directions under sub-section (1) shall be issued so as to--

(a) require any income-tax authority to make a particular assessment or to dispose of a particular case in a particular manner; or

(b) interfere with the discretion of the Joint Commissioner (Appeals) or Commissioner (Appeals) in the exercise of his appellate functions.

(3) Without prejudice to the generality of the foregoing power, the Board may,--

(a) if it considers it necessary or expedient so to do for the proper and efficient management of the work of assessment and collection of revenue, issue, from time to time (whether by way of relaxation of any

S.234 Avoidance of tax and exclusion from tonnage tax scheme

Section 234 -  

(1) Subject to the provisions of this Part, the tonnage tax scheme shall not apply where a tonnage tax company is a party to any transaction or arrangement which amounts to an abuse of the tonnage tax scheme.

(2) For the purposes of sub-section (1), a transaction or arrangement shall be considered an abuse, if the entering into or the application of such transaction or arrangement results, or would but for this section have resulted, in a tax advantage being obtained for--

(a) a person other than a tonnage tax company; or

(b) a tonnage tax company in respect of its non-tonnage tax activities.

(3) For the purposes of this section, "tax advantage" includes--

(a) the determination of--

(i) the allowance for any expense or interest; or

(ii) any cost or expense allocated or apportioned, which has the effect of reducing the income or increasing the loss, from activities other than tonnage tax activities chargeable to

S.237 Appointment of income-tax authorities

(1) The Central Government may appoint such persons as it thinks fit to be income-tax authorities.

(2) The Central Government may, subject to the rules and its orders regulating the conditions of service of persons in public services and posts, authorise the Board, or a Principal Director General or Director General, or a Principal Chief Commissioner or Chief Commissioner, or a Principal Director or Director, or a Principal Commissioner or Commissioner, to appoint income-tax authorities below the rank of a Deputy Commissioner or Assistant Commissioner.

(3) Subject to the rules and orders of the Central Government regulating the conditions of service of persons in public services and posts, an income-tax authority authorised in this behalf by the Board, may appoint such executive or ministerial staff as may be necessary to assist it in the execution of its functions.

S.236 Income-tax authorities

For the purposes of this Act, there shall be the following classes of income-tax authorities:--

(a) the Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963 (54 of 1963);

(b) Principal Directors General of Income-tax or Principal Chief Commissioners of Income-tax;

(c) Directors General of Income-tax or Chief Commissioners of Income-tax;

(d) Principal Directors of Income-tax or Principal Commissioners of Income-tax;

(e) Directors of Income-tax or Commissioners of Income-tax or Commissioners of Income-tax (Appeals);

(f) Additional Directors of Income-tax or Additional Commissioners of Income-tax or Additional Commissioners of Income-tax (Appeals);

(g) Joint Directors of Income-tax or Joint Commissioners of Income-tax or Joint Commissioners of Income-tax (Appeals);

(h) Deputy Directors of Income-tax or Deputy Commissioners of Income-tax;

(i) Assistant Directors of Income-tax or Assistant

S.238 Control of income-tax authorities

The Board may, by notification, direct that any income-tax authority or authorities specified in the notification shall be subordinate to such other income-tax authority or authorities as specified in such notification.

S.240 Taxpayer's Charter

The Board shall adopt and declare a Taxpayer's Charter and issue such orders, instructions, directions or guidelines to other income-tax authorities as it considers fit for the administration of such Charter.

S.241 Jurisdiction of income-tax authorities 

(1) The income-tax authorities shall exercise all or any of the powers and perform all or any of the functions conferred on, or assigned to, such authorities under this Act, as per such directions as the Board may issue for the exercise of the powers and performance of the functions by all or any of those authorities.

(2) Any income-tax authority, being an authority higher in rank, may, if so directed by the Board, exercise the powers and perform the functions of an income-tax authority lower in rank and any such direction issued by the Board shall be deemed to be a direction issued under sub-section (1).

(3) The directions of the Board under sub-section (1) may authorise any other income-tax authority to issue orders in writing for the exercise of the powers and performance of the functions by all or any of the other income-tax authorities who are subordinate to it.

(4) In issuing the directions or orders referred to in sub-sections (1), (2) and (3), the Board

S.242 Jurisdiction of Assessing Officers

(1) Where an Assessing Officer has been vested with jurisdiction over any area by virtue of any direction or order issued under section 241(1) or (2) or (3), he shall have jurisdiction within the limits of such area,--

(a) in respect of any person carrying on a business or profession, if the place at which he carries on his business or profession is situated within the area, or where his business or profession is carried on in more places than one, if the principal place of his business or profession is situated within the area; and (b) in respect of any other person residing within the area.

(2) Where a question arises under this section as to whether an Assessing Officer has jurisdiction to assess any person, the question shall be determined by the specified income-tax authority.

(3) Where under this section, a question arises relating to areas within the jurisdiction of different specified income-tax authorities, the question shall be determined--

(a)

S.243 Power to transfer cases

(1) The specified income-tax authority may transfer any case from one or more Assessing Officers subordinate to him (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) also subordinate to him.

(2) If the Assessing Officer or Assessing Officers, from whom the case is to be transferred and the Assessing Officer or Assessing Officers, to whom the case is to be transferred are not subordinate to the same specified income-tax authority, and the concerned specified income-tax authorities--

(a) are in agreement, then the specified income-tax authority from whose jurisdiction the case is to be transferred may pass the order;

(b) are not in agreement, the order transferring the case may be passed by the Board or any such specified income-tax authority as the Board may, by notification, specify in this behalf.

(3) The order of transfer under sub-section (1) or (2)

S.245 Faceless jurisdiction of income-tax authorities

(1) The Central Government may, by notification, make a scheme for the purposes of--

(a) exercise of all or any of the powers and performance of all or any of the functions conferred on, or assigned to, income-tax authorities under this Act referred to in section 241;

(b) vesting the jurisdiction with the Assessing Officer under section 242; or

(c) exercise of power to transfer cases under section 243; or

(d) exercise of jurisdiction in case of change of incumbency under section 244.

(2) The scheme referred to in sub-section (1) shall be made to impart greater efficiency, transparency and accountability by--

(a) eliminating the interface between the income-tax authority and the assessee or any other person, to the extent technologically feasible;

(b) optimising utilisation of the resources through economies of scale and functional specialisation;

(c) introducing a team-based exercise of powers and performance of functions by t

S.244 Change of incumbent of an office

(1) Whenever, in respect of any proceeding under this Act, an income-tax authority ceases to exercise jurisdiction and is succeeded by another who has and exercises jurisdiction, the income-tax authority so succeeding may continue the proceeding from the stage at which the proceeding was left by his predecessor.

(2) Before the proceeding referred to in sub-section (1) is so continued, the assessee concerned may demand that--

(a) the previous proceeding or any part thereof be reopened; or

(b) he be reheard before any order of assessment is passed against him.

S.247 Search and seizure 

(1) Where the competent authority, in consequence of information in his possession, has reason to believe that--

(a) any person to whom a summons under section 131(1) or a notice under section 142(1) of the Income-tax Act, 1961 (43 of 1961) or summons under section 246(1) or a notice under section 268(1) of this Act,--

(I) was issued to produce, or cause to be produced, any books of account or other documents, or any information in electronic form or on a computer system, has omitted or failed to produce, or cause to be produced, such books of account or other documents or such information as required by such summons or notice; or

(II) has been issued or might be issued, will not, or would not, produce or cause to be produced, any books of account or other documents, or any information in electronic form or on a computer system which will be useful for, or relevant to, any proceedings under the Income-tax Act, 1961 (43 of 1961) or this Act; or

(b) any pe

S.248 Powers to requisition

(1) Where the approving authority, in consequence of information in his possession, has reason to believe that--

(a) any person to whom a summons under section 131(1) or a notice under section 142(1) of the Income-tax Act, 1961 (43 of 1961) or summons under section 246(1), or notice under section 268(1) of this Act was issued to produce, or cause to be produced, any books of account or other documents, or any information in electronic form or on a computer system has omitted or failed to produce, or cause to be produced, such books of account or other documents, or such information as required by such summons or notice and the said books of account or other documents, or any computer system containing the said information have been taken into custody by any officer or authority under any other law for the time being in force; or

(b) any books of account or other documents, or any information in electronic form or on a computer system will be useful for, or relevant to

S.246 Power regarding discovery, production of evidence, etc 

(1) The Assessing Officer, Joint Commissioner, Joint Commissioner (Appeals), Commissioner (Appeals), Commissioner or Principal Commissioner, or Chief Commissioner or Principal Chief Commissioner and the Dispute Resolution Panel referred to in section 275(17)(a), shall, for the purposes of this Act, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the following matters:--

(a) discovery and inspection;

(b) enforcing the attendance of any person, including any officer of a banking company and examining him on oath;

(c) compelling the production of books of account and other documents; and (d) issuing commissions.

(2) The powers conferred under sub-section (1) may also be exercised in respect of any person or class of persons by the following income-tax authorities (even when there are no proceedings pending with respect to such person or class of persons before them or any ot

S.249 Reasons not to be disclosed

The reason to believe or reason to suspect, as referred to in section 247 or 248, recorded by the income-tax authority shall not be disclosed to any person or authority or the Appellate Tribunal.

S.250 Application of seized or requisitioned assets

(1) The amount of the following liabilities may be recovered out of the assets seized under section 247 or requisitioned under section 248 in the following manner, namely:--

(a) the amount of any existing liability (other than advance tax payable the provisions of Part C of Chapter XIX) this Act, the Income-tax Act, 1961 (43 of 1961), the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (22 of 2015) and in respect of which such person is in default or is deemed to be in default;

(b) the amount of the liability determined on completion of the assessment or reassessment or recomputation and the assessment of the year relevant to the tax year in which search is initiated or requisition is made, or the amount of liability determined on completion of the assessment under Part B of Chapter XVI for the block period, as the case may be (including any penalty levied or interest payable in connection with such assessment), and in respect of wh

S.251 Copying, extraction, retention and release of books of account and documents seized or requisitioned 

(1) Where the authorised officer referred to in section 247(1) has no jurisdiction over the person referred to in section 247(1)(a) or (b), assets and material seized or requisitioned under section 247(1) to 247(4) shall be handed over to the Assessing Officer having jurisdiction over such person within a period of one hundred and eighty days from the date on which a search is initiated under section 247 or requisition is made under section 248 and such Assessing Officer thereupon shall exercise the powers under sub-sections (2) and (3).

(2) The authorised officer shall, on an application made by the person from whose custody any material seized or requisitioned, are seized under section 247(1) to (4), allow such person, in the presence of such officer or any other person empowered by such officer in this behalf, to make copies thereof or take extracts therefrom, at such place and time as appointed by such officer.

(3) The authorised officer may--

(a) retain th

S.252 Power to call for information 

(1) The Assessing Officer, the Joint Commissioner or the Joint Commissioner (Appeals) or the Commissioner (Appeals) may, for the purposes of this Act, require any--

(a) person, including a banking company or any officer thereof, to furnish, within such time, requisite information or to furnish statements of account and affairs verified in such manner specified by such authority, giving such information in relation to such matters as, in the opinion of such authority, will be useful for, or relevant to, any enquiry or proceedings under this Act;

(b) firm to furnish him with a return of the names and addresses of the partners of the firm and their respective shares;

(c) Hindu undivided family to furnish him with a return of the names and addresses of the manager and the members of the family;

(d) person whom he has reason to believe to be a trustee, guardian or agent, to furnish him with a return of the names of the persons for or of whom he is trustee, gu

S.258 Disclosure of information relating to assessees 

(1) The Board or any other income-tax authority specified by it by an order in this behalf, may furnish or cause to be furnished to--

(a) any officer, authority or body performing any functions under any law relating to the imposition of any tax, duty or cess, or dealings in foreign exchange as defined in section 2(n) of the Foreign Exchange Management Act, 1999 (42 of 1999); or

(b) such officer, authority or body performing functions under any other law, if in the opinion of the Central Government it is necessary so to do in the public interest, as it may specify by notification in this behalf, any such information received or obtained by any income-tax authority in the performance of its functions under this Act, as may, in the opinion of the Board or other income-tax authority, be necessary for the purpose of enabling the officer, authority or body, to perform his or its functions under that law.

(2) The Principal Chief Commissioner or Chief Commissioner or

S.254 Power to collect certain information 

(1) Irrespective of anything contained in any other provision of this Act, an income-tax authority may, for the purposes of collecting any information which may be useful for, or relevant to, the purposes of this Act, enter--

(a) any building or place within the limits of the area assigned to such authority; or

(b) any building or place occupied by any person in respect of whom such authority exercises jurisdiction, at which a business or profession is carried on, regardless of the fact that such place be the principal place or not of such business or profession and require any proprietor or employee or any other person, who may at that time and place, be attending in any manner to, or helping in, or carrying on of such business or profession, to furnish such information as may be prescribed.

(2) The income-tax authority may enter any place of business or profession referred to in sub-section (1) only during the hours at which such place is open for the conduct

S.259 Power to call for information by prescribed income-tax authority

(1) For the purposes of verification of information in the possession of the prescribed income-tax authority, such authority may issue a notice requiring any person to furnish any information as may be useful for, or relevant to, any inquiry or proceeding under this Act in such form and manner and within such time, as specified in such notice.

(2) The prescribed income-tax authority may process and utilise such information and document received by him as per the scheme notified under section 260.

(3) For the purposes of this section, the term "proceeding" shall have the meaning assigned to it in section 253.

S.257 Proceedings before income-tax authorities to be judicial proceedings

(1) Any proceeding under this Act before an income-tax authority shall be deemed to be a judicial proceeding within the meaning of sections 229 and 267 and for the purposes of section 233 of the Bharatiya Nyaya Sanhita, 2023 (45 of 2023).

(2) Every income-tax authority shall be deemed to be a Civil Court for the purposes of section 215 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023), but not for the purposes of Chapter XXVIII of the Bharatiya Nagarik Suraksha Sanhita 2023 (46 of 2023).

S.255 Power to inspect registers of companies 

The Assessing Officer, assessment unit, verification unit, the Joint Commissioner or the Joint Commissioner (Appeals) or the Commissioner (Appeals), or any person subordinate thereof and authorised in writing in this behalf by such officer or authority, may inspect, and if necessary, take copies, or cause copies to be taken, of any register of the members, debenture holders or mortgagees of any company or of any entry in such register.

S.536 Repeal and savings

(1) The Income-tax Act, 1961 (43 of 1961) is hereby repealed.

(2) Irrespective of the repeal of the Income-tax Act, 1961 (43 of 1961) (herein referred to as the repealed Income-tax Act), and subject to 1[sub-section (4)]--

(a) nothing shall affect the previous operation of the repealed Income-tax Act and orders or anything duly done or suffered thereunder; or

(b) nothing shall affect any right, privilege, obligation or liability acquired, accrued or incurred under the repealed Income-tax Act or orders under such repealed Act;

(c) the provisions of the repealed Income-tax Act shall continue to apply to any proceeding pending on the date of commencement of this Act and to any proceedings initiated on after the 1st April, 2026 (including notices, assessment, re-assessment, recomputation, rectification, penalty, reference, revision and appeals) in respect of any tax year beginning before the 1st April, 2026 and such proceedings shall be carried out as

Sch.II

SCHEDULE II

Income not to be included in total income

 In computing the total income of a person for a tax year, the income mentioned in column B of the Table below shall not be included, subject to fulfilment of the conditions mentioned in column C of the said Table, and the expressions used in columns B and C of the said Table, shall have the meaning respectively assigned to them in the Notes below the said Table.

Table