As part of the ongoing transition to the Income-tax Act, 2025, several important procedural provisions have been restructured, renumbered, and clarified. While the core principles remain similar, the new Act aims to improve clarity, streamline processes, and align provisions with modern compliance requirements.
In this article, we highlight some of the key procedural amendments relevant for professionals and taxpayers.
1. Failure to Furnish Return
(Section 276CC → Section 479)
Under the Income-tax Act, 1961, relief from prosecution was available if the return was filed before the end of the relevant assessment year.
The Income-tax Act, 2025 introduces a more structured approach by linking prosecution relief directly to updated return filing provisions:
- Belated Return – Section 263(4)
- Updated Return – Section 263(6)
- Relief available where tax payable does not exceed ₹10,000 (for non-corporate taxpayers)
👉Key Impact:
This amendment aligns prosecution provisions with revised return filing timelines, bringing greater consistency and clarity.
2. Failure to Furnish Return in Search Cases
(Section 276CCC → Section 480)
The new Act strengthens provisions relating to search cases with clearer procedural safeguards and stricter consequences.
Key Changes
- Prior sanction is mandatory before initiating prosecution
- The offence is expressly classified as non-cognizable
- Repeat offences attract:
- Imprisonment: 6 months to 7 years
- Along with fine
👉 Key Impact: Enhances legal clarity and strengthens the prosecution framework in search-related cases.
3. Service of Notice
(Section 282 → Section 501)
The 2025 Act modernizes communication provisions by incorporating digital terminology directly into the statute.
Key Update
- Definitions of:
- “Electronic Mail”
- “Electronic Mail Message”
are now included within the Act itself.
👉 Key Impact: Ensures legal continuity and validity of electronic communication, especially after the omission of Section 66A of the IT Act.
4. Appearance by Registered Valuer
(Section 287A → Sections 513 & 514)
Earlier, the definition of a Registered Valuer was derived by reference to the Wealth-tax Act.
What’s Changed
- The Income-tax Act, 2025 now defines “Registered Valuer” within the Act itself
👉Key Impact:
Makes the law self-contained, reducing dependency on other statutes and improving interpretational clarity.
5. Faceless Approval / Registration
(Section 293D → Section 532)
The concept of faceless proceedings continues to evolve under the new Act.
Key Change
- A single consolidated provision empowers the Central Government to frame:
- Faceless approval schemes
- Faceless registration systems
👉 Key Impact: Improves efficiency, transparency, and uniformity in administration.
6. Repeal and Transitional Provisions
(Section 297 → Section 536)
The Income-tax Act, 2025 formally repeals the Income-tax Act, 1961, while ensuring a smooth transition.
Key Safeguards
- Pending proceedings for pre-2026 years will continue under the old Act
- Existing:
- Appeals
- Penalties
- Search proceedings
remain valid
- Carry forward of losses and tax credits are preserved
- Existing faceless schemes will continue
👉 Key Impact: Ensures continuity and avoids disruption during the transition phase.
