Income-tax Act, 1961
आयकर अधिनियम, 1961
The primary direct-tax law for individuals, businesses and companies in India
The Income-tax Act, 1961 governs how income is taxed in India — including salary, business, capital gains, house property and other sources. It also covers filing of returns, TDS, deductions, assessments, appeals, and penalties.
Key provisions
Section 4 & 5 — Charge and scope of income
Total income of the previous year is charged to tax; scope depends on residential status.
Section 15-17 — Salaries
Salary, allowances, perquisites and profits in lieu of salary.
Section 80C-80U — Deductions
80C (PPF, ELSS, LIC — ₹1.5L), 80D (health insurance), 80E (education loan), 80TTA, 80G (donations).
Section 115BAC — New tax regime
Concessional slab rates without most deductions; default regime from AY 2024-25.
Section 139 — ITR filing
Due dates: 31 July for individuals; 31 Oct for audit cases; 30 Nov for transfer pricing.
Sections 143, 148 & 148A — Assessments and notices
Intimation (143(1)), scrutiny (143(3)), reassessment (147/148) with pre-notice hearing under 148A (Ashish Agarwal SC judgment).
New vs old tax regime (FY 2024-25)
New regime (default) — 0% up to ₹3L, 5% ₹3-7L, 10% ₹7-10L, 15% ₹10-12L, 20% ₹12-15L, 30% above ₹15L; standard deduction ₹75,000 for salaried. Old regime allows 80C, 80D, HRA, LTA and other deductions but has higher slabs. Choose based on your deduction claims.
How to respond to an income-tax notice
Log in to incometax.gov.in → 'e-Proceedings' → view the notice. Common notices: 143(1) intimation (auto-adjustment), 143(2) scrutiny (respond within 30 days), 148 reassessment (challenge if beyond limitation). Never ignore — a non-response can lead to best-judgment assessment under Section 144.
Who typically needs this
- Salaried employees and freelancers filing ITR
- Small businesses and professionals under presumptive taxation
- Anyone who received an income-tax notice
- Tax practitioners, CAs and advocates handling appeals
Frequently asked questions
Is filing ITR mandatory if my income is below the exemption limit?
Not always, but there are exceptions under the 7th proviso to Section 139(1): if you deposited over ₹1 crore in a current account, spent over ₹2 lakh on foreign travel, paid over ₹1 lakh in electricity bills, or your TDS/TCS exceeds ₹25,000 (₹50,000 for seniors) — filing is mandatory.
What is the last date to file a revised return?
A revised return under Section 139(5) can be filed up to 31 December of the assessment year, or before completion of assessment, whichever is earlier. An updated return (ITR-U) under Section 139(8A) can be filed within 2 years with additional tax.
Can the tax department reopen an old assessment?
Yes, under Section 147 read with Section 148, up to 3 years from the end of the relevant AY (or 10 years for escaped income above ₹50 lakh). A pre-notice enquiry under Section 148A is mandatory (Union of India v. Ashish Agarwal, 2022).
Related laws
Have a specific question about Income Tax?
Kanoon-AI gives free, plain-English legal information grounded in Indian statutes and case law. Not a substitute for a lawyer.
Ask the AI assistant