What is the Income-tax Act, 2025 and when did it come into effect?

The Income-tax Act, 2025 replaced the Income Tax Act 1961 from April 1, 2026. It simplifies the entire direct tax framework, renumbers sections, removes redundancies, and modernizes taxation for India.

Is the Income Tax Act 1961 still valid after April 2026?

The Income Tax Act 1961 was repealed under Section 536 of the new Act from April 1, 2026. However, all assessments, appeals, and proceedings for periods before April 1, 2026 continue under the old ITA 1961 rules.

What is the new section number for Section 80C in Income Tax Act 2025?

Section 80C of the ITA 1961 maps to Section 123 of the Income-tax Act, 2025. Deductions for LIC premiums, PPF, ELSS, EPF, and home loan principal repayment continue under the new act.

What is the new section for TDS on professional fees (194J)?

Section 194J (TDS on professional and technical services) of the old Income Tax Act 1961 has been renumbered in the Income-tax Act, 2025. Use our free converter at ita1961to2025.in to find the exact new section number instantly.

How do I convert old income tax section numbers to new 2025 numbers?

Visit ita1961to2025.in and use the free section search tool. Type any old ITA 1961 section number (e.g., 80C, 194J, 139) and instantly see the new Income-tax Act, 2025 equivalent, its status, and key changes.

Is the ITA 1961 to 2025 mapping tool free for CAs and tax professionals?

Yes, completely free. The section mapper, comparison cheat sheet, PDF download, and Tax Academy blog are all free for Chartered Accountants, tax lawyers, law students, and taxpayers.

Which sections were completely deleted in the new Income Tax Act 2025?

Several redundant and overlapping sections from ITA 1961 were not carried into the Income-tax Act, 2025. Use our free converter — each section is marked as Retained, Modified, or Deleted so you can quickly check any section's status.

Can I download the ITA 1961 to Income-tax Act 2025 comparison as a PDF?

Yes! Visit the Comparison page at ita1961to2025.in/comparison to download a free cheat sheet PDF showing side-by-side mapping of key ITA 1961 sections to their Income-tax Act, 2025 equivalents.

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ITA 1961 → ITA 2025GAAR

Section 96 → Section 195

Impermissible avoidance arrangement

RetainedHigh - Sets the legal boundary for aggressive tax planning.

Quick Answer

Section 96 of the Income Tax Act, 1961 (Impermissible avoidance arrangement) corresponds to Section 195 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.

What changed for Section 96

Under the Income Tax Act, 1961, Section 96 governs impermissible avoidance arrangement. Defines an impermissible arrangement as one whose main purpose is to obtain a tax benefit AND it creates abnormal rights, misuses the law, lacks commercial substance, or is not bona fide.

From 1st April 2026, the same subject sits at Section 195 of the Income-tax Act, 2025 — retained and renumbered as Section 195 of the Income-tax Act, 2025. Retained verbatim. The 'Main Purpose' test is central to invoking GAAR.

For Section 96, the practical impact is rated High. Sets the legal boundary for aggressive tax planning.

Old Law (ITA 1961)Ch: X-A

Sec 96

Provision Summary

Defines an impermissible arrangement as one whose main purpose is to obtain a tax benefit AND it creates abnormal rights, misuses the law, lacks commercial substance, or is not bona fide.

New Law (ITA 2025)Ch: XIII

Sec 195

Provision Summary

Retained verbatim. The 'Main Purpose' test is central to invoking GAAR.

Key Changes & Highlights

AI algorithms analyze complex M&A and demerger documents to flag potential GAAR violations for the review panel.

Related Sections

Section 97

Frequently Asked Questions

What is Section 96 of the Income Tax Act, 1961 about?

Section 96 of the Income Tax Act, 1961 covers impermissible avoidance arrangement. Defines an impermissible arrangement as one whose main purpose is to obtain a tax benefit AND it creates abnormal rights, misuses the law, lacks commercial substance, or is not bona fide.

Which section replaces Section 96 in the Income-tax Act, 2025?

Section 96 of the Income Tax Act, 1961 maps to Section 195 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained verbatim. The 'Main Purpose' test is central to invoking GAAR.

What is the impact of the change to Section 96 under the new tax code?

The transition impact for Section 96 is rated High. Sets the legal boundary for aggressive tax planning.

What should I watch out for when Section 96 moves to the 2025 code?

AI algorithms analyze complex M&A and demerger documents to flag potential GAAR violations for the review panel. These points are specific to Section 96 (Impermissible avoidance arrangement).

Disclaimer: This mapping of Section 96 (Impermissible avoidance arrangement) to Section 195 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 96 is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.

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