Income Tax Rules change from April 1, 2026, with the Central Board of Direct Taxes removing provisions related to arrest and detention from the tax recovery process.
Under the amended rules, outstanding tax dues will instead be recovered through measures such as attachment and sale of property and other assets.
The changes were notified under the Income-tax Fourth Amendment Rules, 2026, issued on September 17, 2026. Some amendments took effect from September 17, while changes involving Rule 225 have been given effect from April 1, 2026.
Income Tax Rules Remove Arrest Provision
The CBDT has amended Rule 225 of the Income Tax Rules, 2026, removing the provision concerning the power of arrest during tax recovery. Related wording referring to arrest and detention has also been removed from another provision.
This means arrest and detention are no longer prescribed as part of the recovery process under the amended Rule 225.
The tax dues themselves, however, do not disappear and the department can continue recovery through the methods provided under the rules.
Property Can Be Used for Tax Recovery
Following the amendment, tax recovery can be carried out through attachment and sale of property or other asset-based measures. The change shifts the prescribed recovery mechanism towards the taxpayer’s assets instead of arrest and detention.
The amendment is in line with changes introduced through the Finance Act, 2026.
Taxpayers with outstanding dues should therefore continue to address their liabilities even though the arrest provision has been removed from the recovery rules.
Valuers Get More Time to Register
The CBDT has also extended the registration deadline for valuers and authorised income tax practitioners. Under the revised rules, the deadline under Rules 246 and 256 has been extended from September 30, 2026, to March 31, 2027.
Valuers will also have to provide additional information through Form 169. This includes personal details, the category of property they can value, educational qualifications, previous employment and professional experience.
Details of valuation work completed during the previous three years will also be required as part of the registration process.
11 Property Categories Covered for Valuation
Registered valuers can apply to undertake valuation work across 11 categories of property. These include land, residential property, agricultural land, plantations, forests, mines, shares, bonds, securities, machinery, jewellery and artwork.
A separate application is required for each property category, with a fee of Rs 10,000. However, valuers who were already registered under the Wealth Tax Act, 1957, are exempt from this fee.
Income Tax Practitioners and Notices
The CBDT has also modified Form 171 for income tax practitioners. Applicants are now required to provide details relating to their education and previous registrations and declare that they have practised before income tax authorities for at least one year.
Another change concerns the way certain information can be communicated. The requirement for a digital signature for sending specified information has been removed, allowing such communication to be made electronically through methods including email or online portals.
The amendments are part of the Income-tax Fourth Amendment Rules, 2026. Taxpayers and professionals affected by the changes should check the applicable provisions and requirements for their specific situation.
