Income Tax Act 1961

 

Law Library

Income Tax Department of India 

Income-tax Act, 1961-2017

INCOME-TAX ACT, 1961
[43 OF 1961]
[AS AMENDED BY FINANCE ACT, 2018]
An Act to consolidate and amend the law relating to income-tax and super-tax
BE it enacted by Parliament in the Twelfth Year of the Republic of India as follows:
As amended by Finance Act 2018

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CHAPTER I – Preliminary
CHAPTER II – Basis of charge
CHAPTER III – Incomes which do not form part of total income
CHAPTER IV – Computation of total income
CHAPTER V – Income of other persons included in assessee’s total income
CHAPTER VI – Aggregation of income and set off or carry forward of loss
CHAPTER VIA – Deductions to be made in computing total income
CHAPTER VII – Incomes forming part of total income on which no income-tax is payable
CHAPTER VIII – Rebates and reliefs
CHAPTER IX – Double Taxation Relief
CHAPTER X – Special provisions relating to avoidance of tax
CHAPTER XA – GENERAL ANTI-AVOIDANCE RULE
CHAPTER XI – Additional income-tax on undistributed profits
CHAPTER XII – Determination of tax in certain special cases
CHAPTER XIIA – Special provisions relating to certain incomes of non-residents
CHAPTER XIIB – Special provisions relating to certain companies
CHAPTER XIIBA – Special provisions relating to certain limited liability partnerships
CHAPTER XIIBB – Special provisions relating to conversion of Indian branch of a foreign bank into a subsidiary company
CHAPTER XIIBC – SPECIAL PROVISIONS RELATING TO FOREIGN COMPANY SAID TO BE RESIDENT IN INDIA
CHAPTER XIIC – Special provisions relating to retail trade etc.
CHAPTER XIID – Special provisions relating to tax on distributed profits of domestic companies
CHAPTER XIIDA – SPECIAL PROVISIONS RELATING TO TAX ON DISTRIBUTED INCOME OF DOMESTIC COMPANY FOR BUY-BACK OF SHARES
CHAPTER XIIE – Special provisions relating to tax on distributed income
CHAPTER XIIEA – SPECIAL PROVISIONS RELATING TO TAX ON DISTRIBUTED INCOME BY SECURITISATION TRUSTS
CHAPTER XIIEB – SPECIAL PROVISIONS RELATING TO TAX ON ACCRETED INCOMEOF CERTAIN TRUSTS AND INSTITUTIONS
CHAPTER XIIF – Special provisions relating to tax on income received from venture capital companies and venture capital funds
CHAPTER XIIFA – SPECIAL PROVISIONS RELATING TO BUSINESS TRUSTS
CHAPTER XIIFB – SPECIAL PROVISIONS RELATING TO TAX ON INCOME OF INVESTMENT FUNDS AND INCOME RECEIVED FROM SUCH FUNDS
CHAPTER XIIG – Special provisions relating to income of shipping companies
CHAPTER XIIH – Income-tax on fringe benefits
CHAPTER XIII – Income-tax Authorities
CHAPTER XIV – Procedure for assessment
CHAPTER XIVA – Special provision for avoiding repetitive appeals
CHAPTER XIVB – Special procedure for assessment of search cases
CHAPTER XV – Liability in special cases
CHAPTER XVI – Special provisions applicable to firms
CHAPTER XVII – Collection and recovery of tax
CHAPTER XVIII – Relief respecting tax on dividends in certain cases
CHAPTER XIX – Refunds
CHAPTER XIXA – Settlement of cases
CHAPTER XIXB – Advance rulings
CHAPTER XX – Appeals and revision
CHAPTER XXA – Acquisition of immovable properties in certain cases of transfer to counteract evasion of tax
CHAPTER XXB – Requirement as to mode of acceptance payment or repayment in certain cases to counteract evasion of tax
CHAPTER XXC – Purchase by central government of immovable properties in certain cases of transfer
CHAPTER XXI – Penalties imposable
CHAPTER XXII – Offences and prosecutions
CHAPTER XXIIB – Tax credit certificates
CHAPTER XXIII – Miscellaneous

First Schedule
INSURANCE BUSINESS

Second Schedule
PROCEDURE FOR RECOVERY OF TAX

Third Schedule
PROCEDURE FOR DISTRAINT BY [ASSESSING OFFICER] [OR TAXRECOVERY OFFICER

Fourth Schedule
RECOGNISED PROVIDENT FUNDS

Fifth Schedule
LIST OF ARTICLES AND THINGS

Sixth Schedule

Seventh Schedule
MINERALS

Eighth Schedule
LIST OF INDUSTRIALLY BACKWARD STATES AND UNION TERRITORIES

Ninth Schedule
Omitted by the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986, w.e.f. 1-4-1988

Tenth Schedule
Omitted by the Finance Act, 1999, w.e.f. 1-4-2000

Eleventh Schedule
LIST OF ARTICLES OR THINGS

Twelfth Schedule
PROCESSED MINERALS AND ORES

Thirteenth Schedule
LIST OF ARTICLES OR THINGS

Fourteenth Schedule
LIST OF ARTICLES OR THINGS OR OPERATIONS

APPENDIX
TEXT OF REMAINING PROVISIONS OF ALLIED ACTS REFERRED TO INCOME-TAX ACT

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CHAPTER I – Preliminary [ click ]

  • Section – 1 : Short title, extent and commencement.
    Section – 2 : Definitions
    Section – 3 : “Previous year” defined

 CHAPTER II – Basis of charge [Click ]

  • Section – 4 : Charge of income-tax
    Section – 5 : Scope of total income
    Section – 5A : Apportionment of income between spouses governed by Portuguese Civil Code
    Section – 6 : Residence in India
    Section – 7 : Income deemed to be received
    Section – 8 : Dividend income
    Section – 9 : Income deemed to accrue or arise in India
    Section – 9A : Certain activities not to constitute business connection in India

 CHAPTER III – Incomes which do not form part of total income

  • Section – 10 : Incomes not included in total income
  • Section – 10A : Special provision in respect of newly established undertakings in free trade zone, etc.
  • Section – 10AA : Special provisions in respect of newly established Units in Special Economic Zones.
  • Section – 10B : Special provisions in respect of newly established hundred per cent export-oriented undertakings
  • Section – 10BA : Special provisions in respect of export of certain articles or things.
  • Section – 10BB : Meaning of computer programmes in certain cases.
  • Section – 10C : Special provision in respect of certain industrial undertakings in North- Eastern Region.
  • Section – 11 : Income13 from property held for charitable or religious purposes.
  • Section – 12 : Income of trusts or institutions from contributions.
  • Section – 12A : Conditions for applicability of sections 11 and 12.
  • Section – 12AA : Procedure for registration.
  • Section – 13 : Section 11 not to apply in certain cases.
  • Section – 13A : Special provision relating to incomes of political parties.
  • Section – 13B : Special provisions relating to voluntary contributions received by electoral trust.

 

 CHAPTER IV – Computation of total income

Section – 14 : Heads of income
Section – 14A : Expenditure incurred in relation to income not includible in total income
Section – 15 : Salaries
Section – 16 : Deductions from salaries
Section – 17 : “Salary”, “perquisite” and “profits in lieu of salary” defined
Section – 18 : [Omitted by the Finance Act, 1988, w.e.f. 1-4-1989]
Section – 22 : Income from house property
Section – 23 : Annual value how determined
Section – 24 : Deductions from income from house property
Section – 25 : Amounts not deductible from income from house property
Section – 25A : Special provision for arrears of rent and unrealised rent received subsequently
Section – 26 : Property owned by co-owners
Section – 27 : “Owner of house property”, “annual charge”, etc., defined
Section – 28 : Profits and gains of business or profession
Section – 29 : Income from profits and gains of business or profession, how computed
Section – 30 : Rent, rates, taxes, repairs and insurance for buildings
Section – 31 : Repairs and insurance of machinery, plant and furniture
Section – 32 : Depreciation
Section – 32A : Investment allowance
Section – 32AB : Investment deposit account
Section – 32AC : Investment in new plant or machinery
Section – 32AD : Investment in new plant or machinery in notified backward areas in certain States
Section – 33 : Development rebate
Section – 33A : Development allowance
Section – 33AB : Tea development account, coffee development account and rubber development account
Section – 33ABA : Site Restoration Fund.
Section – 33AC : Reserves for shipping business.
Section – 33B : Rehabilitation allowance.
Section – 34 : Conditions for depreciation allowance and development rebate.
Section – 34A : Restriction on unabsorbed depreciation and unabsorbed investment allowance for limited period in case of certain domestic companies.
Section – 35 : Expenditure on scientific research
Section – 35A : Expenditure on acquisition of patent rights or copyrights.
Section – 35AB : Expenditure on know-how.
Section – 35ABA : Expenditure for obtaining right to use spectrum for telecommunication services.
Section – 35ABB : Expenditure for obtaining licence to operate telecommunication services.
Section – 35AC : Expenditure on eligible projects or schemes.
Section – 35AD : Deduction in respect of expenditure on specified business.
Section – 35B : Export markets development allowance.
Section – 35C : Agricultural development allowance.
Section – 35CC : Rural development allowance.
Section – 35CCA : Expenditure by way of payment to associations and institutions for carrying out rural development programmes.
Section – 35CCB : Expenditure by way of payment to associations and institutions for carrying out programmes of conservation of natural resources.
Section – 35CCC : Expenditure on agricultural extension project.
Section – 35CCD : Expenditure on skill development project.
Section – 35D : Amortisation of certain preliminary expenses.
Section – 35DD : Amortisation of expenditure in case of amalgamation or demerger.
Section – 35DDA : Amortisation of expenditure incurred under voluntary retirement scheme.
Section – 35E : Deduction for expenditure on prospecting, etc., for certain minerals.
Section – 36 : Other deductions.
Section – 37 : General.
Section – 38 : Building, etc., partly used for business, etc., or not exclusively so used.
Section – 39 : Managing agency commission.
Section – 40 : Amounts not deductible.
Section – 40A : Expenses or payments not deductible in certain circumstances.
Section – 41 : Profits chargeable to tax
Section – 42 : Special provision for deductions in the case of business for prospecting, etc., for mineral oil
Section – 43 : Definitions of certain terms relevant to income from profits and gains of business or profession
Section – 43A : Special provisions consequential to changes in rate of exchange of currency
Section – 43B : Certain deductions to be only on actual payment
Section – 43C : Special provision for computation of cost of acquisition of certain assets
Section – 43CA : Special provision for full value of consideration for transfer of assets other than capital assets in certain cases
Section – 43D : Special provision in case of income of public financial institutions, public companies, etc
Section – 44 : Insurance business
Section – 44A : Special provision for deduction in the case of trade, professional or similar association
Section – 44AA : Maintenance of accounts by certain persons carrying on profession or business
Section – 44AB : Audit of accounts of certain persons carrying on business or profession
Section – 44AC : Special provision for computing profits and gains from the business of trading in certain goods
Section – 44AD : Special provision for computing profits and gains of business on presumptive basis
Section – 44ADA : Special provision for computing profits and gains of profession on presumptive basis
Section – 44AE : Special provision for computing profits and gains of business of plying, hiring or leasing goods carriages
Section – 44AF : Special provisions for computing profits and gains of retail business
Section – 44B : Special provision for computing profits and gains of shipping business in the case of non-residents
Section – 44BB : Special provision for computing profits and gains in connection with the business of exploration, etc., of mineral oils
Section – 44BBA : Special provision for computing profits and gains of the business of operation of aircraft in the case of non-residents
Section – 44BBB : Special provision for computing profits and gains of foreign companies engaged in the business of civil construction, etc., in certain turnkey power projects.
Section – 44C : Deduction of head office expenditure in the case of non-residents.
Section – 44D : Special provisions for computing income by way of royalties, etc., in the case of foreign companies
Section – 44DA : Special provision for computing income by way of royalties, etc., in case of non-residents
Section – 44DB : Special provision for computing deductions in the case of business reorganization of co-operative banks
Section – 45 : Capital gains
Section – 46 : Capital gains on distribution of assets by companies in liquidation.
Section – 46A : Capital gains on purchase by company of its own shares or other specified securities
Section – 47 : Transactions not regarded as transfer
Section – 47A : Withdrawal of exemption in certain cases
Section – 48 : Mode of computation
Section – 49 : Cost with reference to certain modes of acquisition
Section – 50 : Special provision for computation of capital gains in case of depreciable assets
Section – 50A : Special provision for cost of acquisition in case of depreciable asset.
Section – 50B : Special provision for computation of capital gains in case of slump sale.
Section – 50C : Special provision for full value of consideration in certain cases.
Section – 50CA : Special provision for full value of consideration for transfer of share other than quoted share
Section – 50D : Fair market value deemed to be full value of consideration in certain cases
Section – 51 : Advance money received.
Section – 52 : Consideration for transfer in cases of understatement.
Section – 53 : Exemption of capital gains from a residential house
Section – 54 : Profit on sale of property used for residence
Section – 54A : Relief of tax on capital gains in certain cases.
Section – 54C : Capital gain on transfer of jewellery held for personal use not to be charged in certain cases
Section – 54D : Capital gain on compulsory acquisition of lands and buildings not to be charged in certain cases
Section – 54E : Capital gain on transfer of capital assets not to be charged in certain cases
Section – 54EA : Capital gain on transfer of long-term capital assets not to be charged in the case of investment in 55[specified securities]
Section – 54EB : Capital gain on transfer of long-term capital assets not to be charged in certain cases
Section – 54EC : Capital gain not to be charged on investment in certain bonds
Section – 54ED : Capital gain on transfer of certain listed securities or unit not to be charged in certain cases
Section – 54EE : Capital gain not to be charged on investment in units of a specified fund
Section – 54F : Capital gain on transfer of certain capital assets not to be charged in case of investment in residential house
Section – 54G : Exemption of capital gains on transfer of assets in cases of shifting of industrial undertaking from urban area
Section – 54GB : Capital gain on transfer of residential property not to be charged in certain cases
Section – 54H : Extension of time for acquiring new asset or depositing or investing amount of capital gain
Section – 55 : Meaning of “adjusted”, “cost of improvement” and “cost of acquisition”
Section – 55A : Reference to Valuation Officer
Section – 56 : Income from other sources
Section – 57 : Deductions
Section – 58 : Amounts not deductible
Section – 59 : Profits chargeable to tax

CHAPTER VI – Aggregation of income and set off or carry forward of loss

 

CHAPTER VIA – Deductions to be made in computing total income

 

CHAPTER IX – Double Taxation Relief

CHAPTER XII – Determination of tax in certain special cases

 

CHAPTER XIIC – Special provisions relating to retail trade etc.

CHAPTER XIIG – Special provisions relating to income of shipping companies

 

CHAPTER XIIH – Income-tax on fringe benefits

CHAPTER XV – Liability in special cases

 

CHAPTER XIXA – Settlement of cases

CHAPTER XXI – Penalties imposable

 

CHAPTER XXIII – Miscellaneous

Devider

First Schedule

INSURANCE BUSINESS

Second Schedule

PROCEDURE FOR RECOVERY OF TAX

Third Schedule

PROCEDURE FOR DISTRAINT BY 32[ASSESSING OFFICER] 33[OR TAXRECOVERY OFFICER

Fourth Schedule

RECOGNISED PROVIDENT FUNDS

Fifth Schedule

LIST OF ARTICLES AND THINGS

Sixth Schedule

Sixth Schedule

Seventh Schedule

MINERALS

Eighth Schedule

LIST OF INDUSTRIALLY BACKWARD STATES AND UNION TERRITORIES

Ninth Schedule

Omitted by the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986, w.e.f. 1-4-1988

Tenth Schedule

Omitted by the Finance Act, 1999, w.e.f. 1-4-2000

Eleventh Schedule

LIST OF ARTICLES OR THINGS

Twelfth Schedule

PROCESSED MINERALS AND ORES

Thirteenth Schedule

LIST OF ARTICLES OR THINGS

Fourteenth Schedule

LIST OF ARTICLES OR THINGS OR OPERATIONS

APPENDIX

TEXT OF REMAINING PROVISIONS OF ALLIED ACTS REFERRED TO INCOME-TAX ACT

Devider