Income Tax Act 2025: Section 183 for Tax Year 2026-27

Application of this Chapter

[Section-183 as per the Income Tax Act, 2025 (this Act) w.e.f. 1st April, 2026.]

The provisions of this Chapter––

• (a) in addition to, or in lieu of, any other basis for determination of tax liability;
• (b) as per such guidelines and subject to such conditions, as prescribed.

📘 Section 183 Summary: Section 183 clarifies how the provisions of its Chapter apply. They can either supplement or replace other methods for determining tax liability, and their application is governed by prescribed guidelines and conditions.

FAQs on Section 183 of Income Tax Act 2025

1. ❓ What does Section 183 of the Income Tax Act, 2025 state?
   🔹 It provides that the provisions of the relevant Chapter may apply either in addition to or in lieu of any other basis for determining tax liability, and are subject to prescribed guidelines and conditions.
2. ❓ What is meant by “in addition to, or in lieu of, any other basis for determination of tax liability”?
   🔹 This means the provisions of this Chapter can either supplement existing tax computation methods or entirely replace them, depending on the situation and specific prescriptions.
3. ❓ Does Section 183 apply automatically to all taxpayers?
   🔹 No. Its applicability depends on the nature of the Chapter it introduces and the specific guidelines or conditions prescribed under the Income Tax Rules.
4. ❓ Who will issue the “guidelines and conditions” referred to in Section 183?
   🔹 The Central Board of Direct Taxes (CBDT) will issue these through notifications, rules, or circulars under powers granted by the Act.
5. ❓ What happens if the taxpayer does not comply with the prescribed conditions?
   🔹 Non-compliance may render the provisions of this Chapter inapplicable to the taxpayer, meaning the regular method of computing tax liability would apply.
6. ❓ Can a taxpayer choose whether to apply this Chapter’s provisions?
   🔹 That depends on whether the provisions are mandatory or optional, as detailed in the rules and guidelines issued by CBDT for the specific Chapter.
7. ❓ Is Section 183 linked to any particular type of income or taxpayer?
   🔹 The scope of Section 183 is contextual—it depends on which Chapter it’s a part of. Section 183 is a procedural section and applies to that Chapter’s framework.
8. ❓ From when does Section 183 come into effect?
   🔹 It is effective from 1st April, 2026.