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THE INCOME TAX ACT, 2025
Section 1 of Income Tax Act - Shor... Section 2 of Income Tax Act - Defi... Section 3 of Income Tax Act - Def... Section 4 of Income Tax Act - Char... Section 5 of Income Tax Act - Scop... Section 6 of Income Tax Act - Resi... Section 7 of Income Tax Act - Inco... Section 8 of Income Tax Act - Inco... Section 9 of Income Tax Act - Inco... Section 10 of Income Tax Act - App... Section 11 of Income tax Act - Inc... Section 12 of Income Tax Act - Inc... Section 13 of Income Tax Act - Hea... Section 14 of Income Tax Act - Inc... Section 15 of Income Tax Act - Sal... Section 16 of Income Tax Act - Inc... Section 17 of Income Tax Act - Per... Section 18 of Income Tax Act - Pro... Section 19 of Income Tax Act - Ded... Section 20 of Income Tax Act - Inc... Section 21 of Income Tax Act - Det... Section 22 of Income Tax Act - Ded... Section 23 of Income Tax Act - Arr... Section 24 of Income Tax Act - Pro... Section 25 of Income Tax Act - Int... Section 26 of Income Tax Act - Inc... Section 27 of Income Tax Act - Man... Section 28 of Income Tax Act - Ren... Section 29 of Income Tax Act - Ded... Section 30 of Income Tax Act - Ded... Section 31 of Income Tax Act - Ded... Section 32 of Income Tax Act - Oth... Section 33 of Income Tax Act - Ded... Section 34 of Income Tax Act - Gen... Section 35 of Income Tax Act - Amo... Section 36 of Income Tax Act - Exp... Section 37 of Income Tax Act - Cer... Section 38 of Income Tax Act - Cer... Section 39 of Income Tax Act - Com... Section 40 of Income Tax Act - Spe... Section 41 of Income Tax Act - Wri... Section 42 of Income Tax Act - Cap... Section 43 of Income Tax Act - Tax... Section 44 of Income Tax Act - Amo... Section 45 of Income Tax Act - Exp... Section 46 of Income Tax Act - Cap... Section 47 of Income Tax Act - Exp... Section 48 of Income Tax Act - Tea... Section 49 of Income Tax Act - Sit... Section 50 of Income Tax Act - Spe... Section 51 of Income Tax Act - Amo... Section 52 of Income Tax Act - Amo... Section 53 of Income Tax Act - Ful... Section 54 of Income Tax Act - Bus... Section 55 of Income Tax Act - Ins... Section 56 of Income Tax Act - Spe... Section 57 of Income Tax Act - Rev... Section 58 of Income Tax Act - . S... Section 59 of Income Tax Act - Com... Section 60 of Income Tax Act - Ded... Section 61 of Income Tax Act - Spe... Section 62 of Income Tax Act - Mai... Section 63 of Income Tax Act - Tax... Section 64 of Income Tax Act - Spe... Section 65 of Income Tax Act - Int... Section 66 of Income Tax Act - Int... Section 67 of Income Tax Act - Cap... Section 69 of Income Tax Act - Cap...

Section 70 of Income Tax Act - Tra...

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Section 329 - Joint and several li... Section 330 - Firm dissolved or bu... Section 331 - Liability of partner... Section 332 - Application for regi... Section 333 - Switching over of re... Section 334 - Tax on income of reg... Section 335 - Regular income... Section 336 - Taxable regular inco... Section 337 - Specified income... Section 338 - Income not to be inc... Section 339 - Corpus donation... Section 340 - Deemed corpus donati... Section 341 - Application of incom... Section 342 - Accumulated income... Section 343 - Deemed accumulated i... Section 344 - Business undertaking... Section 345 - Restriction on comme... Section 346 - Restriction on comme... Section 347 - Books of account... Section 348 - Audit... Section 349 - Return of income... Section 350 - Permitted modes of i... Section 351 - Specified violation... Section 352 - Tax on accreted inco... Section 353 - Other violations... Section 354 - Application for appr... Section 355 - Interpretation... Section 356 - Appealable orders be... Section 357 - Appealable orders be... Section 358 - Form of appeal and l... Section 359 - Procedure in appeal... Section 360 - Powers of Joint Comm... Section 361 - Appellate Tribunal... Section 362 - Appeals to Appellate... Section 363 - Orders of Appellate ... Section 364 - Procedure of Appella... Section 365 - Appeal to High Court... Section 366 - Case before High Cou... Section 367 - Appeal to Supreme Co... Section 368 - Hearing before Supre... Section 369 - Tax to be paid irres... Section 370 - Execution for costs ... Section 371 - Amendment of assessm... Section 372 - Exclusion of time ta... Section 373 - Filing of appeal by ... ... Section 375 - Procedure when asses... Section 376 - Procedure where an i... Section 377 - Revision of orders p... Section 378 - Revision of other or... Section 379 - Dispute Resolution C... Section 380 - Interpretation... Section 381 - Board for Advance Ru... Section 382 - Vacancies, etc, not ... Section 383 - Application for adva... Section 384 - Procedure on receipt... Section 385 - Appellate authority ... Section 386 - Advance ruling to be... Section 387 - Powers of the Board ... Section 388 - Procedure of Board f... Section 389 - Appeal... Section 390 - Deduction or collect... Section 391 - Direct payment... Section 392 - Salary and accumulat... Section 393 - Tax to be deducted a... Section 394 - Collection of tax at... Section 395 - Certificates... Section 396 - Tax deducted is inco... Section 397 - Compliance and repor... Section 398 - Consequences of fail... Section 399 - Processing... Section 400 - Power of Central Gov... Section 401 - Bar against direct d... Section 402 - Interpretation... Section 403 - Liability for paymen... Section 404 - Conditions of liabil... Section 405 - Computation of advan... Section 406 - Payment of advance t... Section 407 - Payment of advance t... Section 408 - Instalments of advan... Section 409 - When assessee is dee... Section 410 - Credit for advance t... Section 411 - When tax payable and... Section 412 - Penalty payable when... Section 413 - Certificate by Tax R... Section 414 - Tax Recovery Officer... Section 415 - Stay of proceedings ... Section 416 - Other modes of recov... Section 417 - Recovery through Sta... Section 418 - Recovery of tax in p... Section 419 - Recovery of penaltie... Section 420 - Tax clearance certif... Section 421 of Income Tax Act - Re... Section 422 of Income Tax Act - Re... Section 423 of Income Tax Act - In... Section 424 of Income Tax Act - In... Section 425 of Income Tax Act - In... Section 426 of Income Tax Act - In... Section 427 of Income Tax Act - Fe... Section 428 of Income Tax Act - Fe... Section 429 of Income Tax Act - Fe... Section 430 of Income Tax Act - Fe... Section 431 of Income Tax Act - Re... Section 432 of Income Tax Act - Pe... Section 433 of Income Tax Act - Fo... Section 434 of Income Tax Act - Re... Section 435 of Income Tax Act - Re... 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Section 488 of Income Tax Act - Of... Section 489 of Income Tax Act - Pr... Section 490 of Income Tax Act - Pr... Section 491 of Income Tax Act - Pr... Section 492 of Income Tax Act - Ce... Section 493 of Income Tax Act - Pr... Section 494 of Income Tax Act - Di... Section 495 of Income Tax Act - Sp... Section 496 of Income Tax Act - Of... Section 497 of Income Tax Act - Tr... Section 498 of Income Tax Act - Ap... Section 499 of Income Tax Act - Ce... Section 500 of Income Tax Act - Pr... Section 501 of Income Tax Act - Se... Section 502 of Income Tax Act - Au... Section 502 of Income Tax Act - Au... Section 503 of Income Tax Act - Se... Section 504 of Income Tax Act - Se... Section 505 of Income Tax Act - Su... Section 506 of Income Tax Act - Fu... Section 507 of Income Tax Act - Su... Section 508 of Income Tax Act - Ob... Section 509 of Income Tax Act - Ob... Section 510 of Income Tax Act - An... Section 511 of Income Tax Act - Fu... Section 512 of Income Tax Act - Pu... 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SCHEDULE III of Income Tax Act - I... SCHEDULE IV of Income Tax Act - IN... SCHEDULE V of Income Tax Act - INC... SCHEDULE VI of Income Tax Act - IN... SCHEDULE VII of Income Tax Act - P... SCHEDULE VIII of Income Tax Act - ... SCHEDULE IX of Income Tax Act - DE... SCHEDULE X of Income Tax Act - DED... SCHEDULE XI of Income Tax Act... SCHEDULE XII of Income Tax Act... SCHEDULE XIII of Income Tax Act -... SCHEDULE XIV of Income Tax Act - L... SCHEDULE XV of Income Tax Act - DE... SCHEDULE XVI of Income Tax Act - P...

Section 70 of Income Tax Act - Transactions not regarded as transfer

70. Transactions not regarded as transfer.

(1) The provisions of section 67 shall not apply to transfer—

(a) by way of distribution of capital assets on the total or partial partition of a Hindu undivided family;

(b) of a capital asset by an individual or a Hindu undivided family, under a will or a gift or an irrevocable trust;

(c) of a capital asset, not being stock-in-trade, by a company to its subsidiary company, if—

(i) the parent company or its nominees hold the whole of the share capital of the subsidiary company; and

(ii) the subsidiary company is an Indian company;

(d) of a capital asset, not being stock-in-trade, by a subsidiary company to the holding company, if–

(i) the whole of the share capital of the subsidiary company is held by the holding company; and

(ii) the holding company is an Indian company;

(e) in a scheme of amalgamation, of a capital asset by the amalgamating company to the amalgamated company, if the amalgamated company is an Indian company;

(f) by a shareholder, in a scheme of amalgamation, of a capital asset being a share or shares held by him in the amalgamating company, if—

(i) the transfer is made in consideration of allotment to him of any share or shares in the amalgamated company except when the shareholder itself is the amalgamated company; and

(ii) the amalgamated company is an Indian company;

(g) in a scheme of amalgamation, to him of a capital asset being a share or shares held in an Indian company by the amalgamating foreign company to the amalgamated foreign company, if—

(i) at least 25% of the shareholders of the amalgamating foreign company continue to remain shareholders of the amalgamated foreign company; and

(ii) such transfer does not attract tax on capital gains in the country, in which the amalgamating company is incorporated;

(h) in a scheme of amalgamation, of a capital asset, being a share of a foreign company, referred to in section 9(10)(a), which derives directly or indirectly, its value substantially from the share or shares of an Indian company, held by the amalgamating foreign company to the amalgamated foreign company, if—

(i) at least 25% of the shareholders of the amalgamating foreign company continue to remain shareholders of the amalgamated foreign company; and

(ii) such transfer does not attract tax on capital gains in the country in which the amalgamating company is incorporated;

(i) of a capital asset by a banking company to a banking institution under a scheme of amalgamation of a banking company with a banking institution sanctioned and brought into force by the Central Government under section 45(7) of the Banking Regulation Act, 1949;

(j) in a demerger, of a capital asset by the demerged company to the resulting company, if the resulting company is an Indian company;

(k) of shares by the resulting company or issue of shares by such company, in a scheme of demerger to the shareholders of the demerged company, if the transfer or issue is made in consideration of demerger of the undertaking;

(l) of a capital asset in a demerger, being a share or shares held in an Indian company, by the demerged foreign company to the resulting foreign company, if—

(i) the shareholders holding not less than 75% in value of the shares of the demerged foreign company continue to remain shareholders of the resulting foreign company; and

(ii) such transfer does not attract tax on capital gains in the country, in which the demerged foreign company is incorporated, and in such a case the provisions of sections 230 to 232 of the Companies Act, 2013 shall not apply;

(m) of a capital asset in a demerger, being a share of a foreign company, referred to in section 9(10)(a), which derives directly or indirectly, its value substantially from the share or shares of an Indian company, held by the demerged foreign company to the resulting foreign company, if—

(i) the shareholders, holding not less than 75% in value of the shares of the demerged foreign company, continue to remain shareholders of the resulting foreign company; and

(ii) such transfer does not attract tax on capital gains in the country in which the demerged foreign company is incorporated,

and in such a case the provisions of sections 230 to 232 of the Companies Act, 2013 shall not apply;

(n) in a business reorganisation, of a capital asset by the predecessor co-operative bank to the successor co-operative bank or to the converted banking company;

(o) by a shareholder, in a business reorganisation, of capital asset being share or shares held by him in the predecessor co-operative bank, if the transfer is made in consideration of the allotment to him of any share or shares in the successor co-operative bank or the converted banking company;

(p) of a capital asset, being bonds or Global Depository Receipts as referred to in section 209(1), made outside India by a non-resident to another non-resident;

(q) made outside India, of a capital asset, being rupee denominated bond of an Indian company issued outside India, by a non-resident to another non-resident;

(r) of a capital asset made by a non-resident on a recognised stock exchange located in any International Financial Services Centre, where the consideration for such transaction is paid or payable in foreign currency, and such capital asset is—

(i) bond or Global Depository Receipt referred to in section 209(1); or

(ii) rupee denominated bond of an Indian company; or

(iii) derivative; or

(iv) such other securities as may be notified by the Central Government;

(s) of a capital asset, being a Government security carrying a periodic payment of interest, made outside India through an intermediary dealing in settlement of securities, by a non-resident to another non-resident;

(t) in a relocation, of a capital asset by the original fund to the resulting fund;

(u) by a shareholder or unit holder or interest holder, in a relocation, of a capital asset being share or unit or interest held by him in the original fund in consideration for the share or unit or interest in the resultant fund;

(v) of a capital asset by India Infrastructure Finance Company Limited to an institution established for financing the infrastructure and development, set up under an Act of Parliament and notified by the Central Government for the purposes of this clause;

(w) of a capital asset, under a plan approved by the Central Government, by a public sector company, to–

(i) another public sector company notified by the Central Government for the purposes of this clause; or

(ii) the Central Government; or

(iii) a State Government;

(x) of Sovereign Gold Bond issued by the Reserve Bank of India under the Sovereign Gold Bond Scheme, 2015, by way of redemption, by an individual;

(y) of a capital asset, being conversion of gold into Electronic Gold Receipt issued by a Vault Manager, or conversion of Electronic Gold Receipt into gold;

(z) by way of conversion of bonds or debentures, debenture-stock or deposit certificates in any form, of a company into shares or debentures of that company;

(za) by way of conversion of bonds referred to in section 209(1) (Table: Sl. No. 1) into shares or debentures of any company;

(zb) by way of conversion of preference shares of a company into equity shares of that company;

(zc) of a capital asset, being any work of art, archaeological, scientific or art collection, book, manuscript, drawing, painting, photograph or print, to—

(i) the Government; or

(ii) a University; or

(iii) the National Museum, National Art Gallery or National Archives; or

(iv) such other public museum or institution as may be notified by the Central Government to be of national importance or of renown throughout any State;

(zd) of a capital asset or intangible asset by a firm to a company as a result of succession of the firm by a company in the business carried on by the firm, if–

(i) all the assets and liabilities of the firm relating to the business immediately before the succession become the assets and liabilities of the company;

(ii) all the partners of the firm, immediately before the succession, become the shareholders of the company in the same proportion in which their capital accounts stood in the books of the firm on the date of the succession;

(iii) the partners of the firm do not receive any consideration or benefit, directly or indirectly, in any form or manner, other than by way of allotment of shares in the company; and

(iv) the aggregate of the shareholding of the partners in the company is not less than 50% of the total voting power and such shareholding continues to not less than 50% for five years from the date of succession;

(ze) of a capital asset or intangible asset by a private company or unlisted public company (herein referred to as the company) to a limited liability partnership or transfer of a share or shares held in the company by a shareholder as a result of conversion of the company into a limited liability partnership under the provisions of section 56 or 57 of the Limited Liability Partnership Act, 2008, if–

(i) all the assets and liabilities of the company, immediately before the conversion, become the assets and liabilities of the limited liability partnership;

(ii) all the shareholders of the company, immediately before the conversion, become the partners of the limited liability partnership and their capital contribution and profit sharing ratio in the limited liability partnership are in the same proportion as their shareholding in the company on the date of conversion;

(iii) the shareholders of the company do not receive any consideration or benefit, directly or indirectly, other than by way of share in profit and capital contribution in the limited liability partnership;

(iv) the aggregate of the profit sharing ratio of the shareholders of the company in the limited liability partnership shall not be less than 50% at any time during five years from the date of conversion;

(v) the total sales, turnover or gross receipts in the business of the company in any of the three tax years preceding the tax year in which the conversion takes place does not exceed sixty lakh rupees;

(vi) the total value of the assets, as appearing in the books of account of the company in any of the three tax years preceding the tax year in which the conversion takes place does not exceed five crore rupees; and

(vii) no amount is paid, either directly or indirectly, to any partner out of balance of accumulated profit standing in the accounts of the company on the date of conversion for three years from the date of conversion;

(zf) of a capital asset or intangible asset (by way of sale or otherwise) by a sole proprietorship concern to a company in case of succession of the sole proprietorship concern by the company in the business carried on by it, if–

(i) all the assets and liabilities related to the business of the sole proprietary concern, immediately before the succession, become the assets and liabilities of the company;

(ii) the shareholding of the sole proprietor in the company is not less than 50% of the total voting power and such shareholding continues to be not less then 50% for five years from the date of the succession; and

(iii) the sole proprietor does not receive any consideration or benefit, directly or indirectly, except through allotment of shares in the company;

(zg) in a scheme for lending of any securities under an agreement or arrangement, entered into by the assessee with the borrower of such securities and which is subject to the guidelines issued by the Securities and Exchange Board of India or the Reserve Bank of India;

(zh) of a capital asset in a transaction of reverse mortgage under a scheme notified by the Central Government;

(zi) of a capital asset, being share or shares of a special purpose vehicle to a business trust in exchange of units allotted by that trust to the transferor;

(zj) of a capital asset by a unit holder, being a unit or units, held by him in the consolidating scheme of a mutual fund, in consideration of the allotment to the unit holder of a capital asset, being a unit or units, in the consolidated scheme of the mutual fund subject to the condition that the consolidation is of two or more schemes–

(i) of an equity-oriented fund; or

(ii) of a fund other than equity-oriented fund;

(zk) of a capital asset by a unit holder, being a unit or units, held by him in the consolidating plan of a mutual fund scheme, in consideration of the allotment to the unit holder of a capital asset, being a unit or units, in the consolidated plan of that scheme of the mutual fund;

(zl) of a capital asset, being an interest in a joint venture, held by a public sector company, in exchange for shares of a company incorporated outside India by the government of a foreign State, as per the laws of that foreign State.

(2) In sub-section (1), the definitions mentioned in column C of the Table below shall apply to the corresponding clauses of the said sub-section mentioned in column B of the said Table.

Table

Sl. No.

Clause

Definitions

A

B

C

1.

(i)

The expressions,—

(a) “banking company” shall have the same meaning as assigned to it in section 5(c) of the Banking Regulation Act, 1949 (10 of 1949);

(b) “banking institution” shall have the same meaning as assigned to it in section 45(15) of the Banking Regulation Act, 1949 (10 of 1949).

2.

(n) and (o)

“business reorganisation”, “converted banking company”, “predecessor co-operative bank” and “successor co-operative bank” shall have the meanings respectively assigned to them in section 65.

3.

(r)

(a) “derivative” shall have the same meaning as assigned to it in section 2(ac) of the Securities Contracts (Regulation) Act, 1956 (42 of 1956);

(b) “securities” shall have the same meaning as assigned to it in section 2(h) of the Securities Contracts (Regulation) Act, 1956 (42 of 1956).

4.

(s)

“Government Security” shall have the same meaning as assigned to it in section 2(b) of the Securities Contracts (Regulation) Act, 1956 (42 of 1956).

5.

(t) and (u)

(a) “original fund” means—

(A) 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:—

(i) the fund is not a person resident in India;

(ii) the fund is 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 is established or incorporated or registered in a country or a specified territory as may be notified by the Central Government;

(iii) the fund and its activities are subject to applicable investor protection regulations in the country or specified territory where it is established or incorporated or is a resident; and

(iv) fulfils other conditions as may be prescribed;

(B) an investment vehicle, in which Abu Dhabi Investment Authority is the direct or indirect sole shareholder or unit holder or beneficiary or interest holder and such investment vehicle is wholly owned and controlled, directly or indirectly, by the Abu Dhabi Investment Authority or the Government of Abu Dhabi; or

(C) a fund notified by the Central Government subject to conditions as specified;

(b) “relocation” means transfer of assets of the original fund, or of its wholly owned special purpose vehicle, to a resultant fund on or before the 31st March, 2030, where consideration for such transfer is discharged in the form of share or unit or interest in the resulting fund to—

(i) a shareholder or unit holder or interest holder of the original fund, in the same proportion in which the share or unit or interest was held by such shareholder or unit holder or interest holder in such original fund, in lieu of their shares or units or interests in the original fund; or

(ii) the original fund, in the same proportion as referred to in sub-clause (i), in respect of which the share or unit or interest is not issued by resultant fund to its shareholder or unit holder or interest holder;

(c) “resultant fund” means a fund established or incorporated in India in the form of a trust or a company or a limited liability partnership, which is located in an International Financial Services Centre as referred to in section 147 and has been granted—

(i) a certificate of registration as a Category I or Category II or Category III Alternative Investment Fund; or

(ii) a certificate as a retail scheme or an Exchange Traded Fund as per Schedule VI (Note 1) and which fulfils the conditions specified in Schedule VI (Table: Sl. No. 1),

and is regulated under the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012 made under the Securities and Exchange Board of India Act, 1992 (15 of 1992) or regulated under the International Financial Services Centres Authority (Fund Management) Regulations, 2022 made under the International Financial Services Centres Authority Act, 2019 (50 of 2019).

6.

(y)

“Electronic Gold Receipt” and “Vault Manager” shall have the same meanings as respectively assigned to them in regulation 2(1)(h) and (l) of the Securities and Exchange Board of India (Vault Managers) Regulations, 2021 made under the Securities and Exchange Board of India Act, 1992 (15 of 1992).

7.

(zc)

“University” means a University established or incorporated by or under a Central Act or State Act or Provincial Act and includes an institution declared under section 3 of the University Grants Commission Act, 1956 (3 of 1956), to be a University for the purposes of that Act.

8.

(ze)

“private company” and “unlisted public company” shall have the same meanings as respectively assigned to them in the Limited Liability Partnership Act, 2008 (6 of 2009).

9.

(zi)

“special purpose vehicle” shall have the meaning assigned to it in Schedule V (Note 2).

10.

(zj)

(a) “consolidated scheme” means the scheme with which the consolidating scheme merges or which is formed as a result of such merger;

(b) “consolidating scheme” means the scheme of a mutual fund which merges under the process of consolidation of the schemes of mutual fund as per the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 made under the Securities and Exchange Board of India Act, 1992 (15 of 1992);

(c) “equity oriented fund” means a fund—

(i) where the investible funds are invested by way of equity shares in domestic companies to the extent of more than 65% of the total proceeds of such fund, for which the percentage of equity shareholding shall be computed with reference to the annual average of the monthly averages of the opening and closing figures; and

(ii) which has been set up under a scheme of Mutual Fund specified in Schedule VII (Table: Sl. No. 20 or 21);

(d) “mutual fund” means a mutual fund specified in Schedule VII (Table: Sl. No. 20 or 21)

11.

(zk)

(a) “consolidating plan” means the plan within a scheme of a mutual fund which merges under the process of consolidation of the plans within a scheme of mutual fund as per the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 made under the Securities and Exchange Board of India Act, 1992 (15 of 1992);

(b) “consolidated plan” means the plan with which the consolidating plan merges or which is formed as a result of such merger;

(c) “mutual fund” means a mutual fund specified in Schedule VII (Table: Sl. No. 20 or 21).

12.

(zl)

“joint venture” means a business entity, as may be notified by the Central Government.

 

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