The Central Board of Direct Taxes (CBDT) has amended the established process for recovering tax arrears by excluding provisions related to arrest and detention. Furthermore, the CBDT has granted valuers and authorized income tax professionals an additional six-month period to complete registration under the new Income Tax Act 2025.
In a notification issued on September 17, CBDT modified Rule 225 of the Income Tax Rules 2026, which governs the recovery of tax arrears. This amendment removes a clause referencing arrest powers and deletes the phrase 'except for arrest and detention' from another provision. Several other sub-rules of Rule 225 were also deleted. These changes in Rules 2–4, including Rule 225, are effective retrospectively from April 1, 2026.
Richa Souney, Partner at Grant Thornton Bharat, noted that 'the exclusion of arrest and detention provisions from the established tax recovery rules with retrospective effect from April 1, 2026, is a significant change. In fact, tax recovery will continue through attachment and sale of assets and other recovery mechanisms, but personal arrest will no longer be part of the established recovery process under these Rules.'
She added that 'this amendment aligns Rule 225 with the changes introduced by the Finance Act 2026 and reflects a shift towards asset-based recovery measures.'
Separately, CBDT extended the registration deadline for valuers and authorized income tax professionals by six months in accordance with Rules 246 and 256. The deadline, previously set for September 30, 2026, has been extended to March 31, 2027.
The notification also replaced Form 169, the application form for valuer registration under Section 514 of the Income Tax Act 2025. The updated form requires applicants to provide personal details, the asset class for which registration is sought, educational qualifications, previous employment history, and professional experience. Valuers must also provide information on assessed assets or work performed over the preceding three years.
The form provides for registration across 11 asset classes, including immovable property, agricultural land, plantations, forests, mines and quarries, securities, machinery and equipment, jewellery, and works of art. A separate application is required for each asset class. A fee of 10,000 rupees is charged for submitting the application, although valuers already registered under the Wealth Tax Act 1957 are exempt from this fee.
CBDT also replaced Form 171, the application form for registration of an authorized income tax professional. The revised form requests details such as educational qualifications and existing registration under the Income Tax Act 1961. Applicants must confirm that they have practiced before tax authorities for at least one year.
Additionally, the notification amended Rule 176, replacing the requirement to send certain communications 'via digital signature' with sending 'through electronic communication.' These changes were announced under the Income Tax Rules (Fourth Amendment) 2026.