Income Tax Act 2025: Section 529 for Tax Year 2025-26

Power to withdraw approval

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

Where the Central Government or the Board or an income-tax authority, has the power to grant any approval under any provision of this Act to any assessee, the Central Government or the Board or such income-tax authority may, withdraw such approval at any time after recording the reasons therefor, even if such provision does not specifically allow for its withdrawal, after giving such assessee a reasonable opportunity of being heard.

FAQs on Section 529 of the Income Tax Act, 2025

1. What is Section 529 of the Income Tax Act, 2025?
   • Section 529 grants the Central Government, the Board, or an income-tax authority the power to withdraw any approval given to an assessee, even if the provision under which approval was granted does not explicitly allow for withdrawal.
2. When does Section 529 come into effect?
   • It comes into effect on April 1, 2026, for the tax year 2025-26.
3. Why was Section 529 introduced?
   • It ensures that approvals granted under the Income Tax Act can be withdrawn if necessary, subject to recorded reasons and a fair hearing.
4. Who has the authority to withdraw approval under Section 529?
   • The Central Government, the Board, or any income-tax authority with the power to grant the approval also has the power to withdraw it.
5. Can approval be withdrawn even if the original provision does not mention withdrawal?
   • Yes, Section 529 explicitly allows withdrawal of approval even if the provision granting the approval does not mention the possibility of withdrawal.
6. What conditions must be met before withdrawing an approval?
   • The authority must:
     • Record the reasons for withdrawal.
     • Provide the assessee a reasonable opportunity to be heard before making a final decision.
7. Does this section apply to all approvals under the Income Tax Act?
   • Yes, it applies to any approval granted under any provision of the Act.
8. What does “reasonable opportunity of being heard” mean?
   • It means the assessee must be given a chance to present their case before the approval is withdrawn.
9. Can an assessee challenge the withdrawal of approval?
   • Yes, an assessee can appeal the decision through appropriate legal channels.
10. How does this affect tax-exempt institutions or businesses relying on approvals?
    • Institutions or businesses with tax exemptions, deductions, or benefits granted through approvals may lose their benefits if approval is withdrawn under Section 529.
11. What happens if an approval is withdrawn?
    • The assessee may no longer be eligible for tax exemptions or benefits previously granted under that approval.
12. How does this impact students studying taxation?
    • Students need to understand the importance of approvals, compliance, and the possibility of revocation when dealing with tax planning and advisory services.
13. Where can I read more about Section 529?
    • You can refer to the official Income Tax Act, 2025, or visit the Income Tax Department’s website for notifications and clarifications.

Section 529 of the Income Tax Act, 2025 (effective from April 1, 2026) grants the Central Government, the Board, or an income-tax authority the power to withdraw any approval given to an assessee, even if the original provision does not explicitly allow for withdrawal. The withdrawal must be based on recorded reasons and after providing the assessee a reasonable opportunity to be heard.

This provision applies to all approvals under the Act, affecting tax exemptions, deductions, and benefits granted through such approvals. Assessees have the right to challenge the withdrawal through legal channels, making compliance and continuous eligibility crucial for those relying on tax approvals.