| Abstract: |
Purpose: - This paper analyzes the transition from India's Income Tax Act, 1961 (ITA 1961) to the Income Tax Act, 2025 (ITA 2025), effective from April 1, 2026. The 1961 Act, with over 4,000 amendments, became overly complex with 819 sections and 1,200+ provisos. The comparison covers legislative history, structure, terminology, TDS/TCS framework, substantive law, transitional provisions, and stakeholder impact.
Methodology: The study uses doctrinal legal research, including comparative analysis, section mapping, and jurisprudential review. Sources include both Acts, CBDT circulars, Draft Income Tax Rules, 2026, and various secondary analyses.
Key Findings: ITA 2025 is a revenue-neutral reform, simplifying the Act by reducing sections from 819 to 536, removing 1,200+ provisos, and consolidating TDS sections. It introduces a unified “Tax Year” and significant changes like a codified reassessment framework, expanded VDA definitions, digital investigation powers, higher TDS thresholds for senior citizens, and extended HRA benefits for eight cities.
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