TaxTMI 
TaxTMI 
Continuity and Change in the Judicial Status of Tax Proceedings : Clause 257 of the Income Tax Bill, 2025 Vs. Section 136 of the Income-tax Act, 1961
X X X X Extracts X X X X
X X X X Extracts X X X X
....s, particularly in the context of the law of evidence, contempt of court, perjury, and the execution of certain legal processes. The Income Tax Bill, 2025, through Clause 257, proposes to continue and update this legal tradition in light of recent legislative reforms, notably the replacement of older criminal and procedural codes with the Bharatiya Nyaya Sanhita, 2023 and the Bharatiya Nagarik Suraksha Sanhita, 2023. This commentary undertakes a comprehensive analysis of Clause 257, examines its objectives and implications, and provides a detailed comparative analysis with the existing Section 136 of the Income-tax Act, 1961. The analysis also explores the broader policy context, potential interpretational issues, and practical ramification....
X X X X Extracts X X X X
X X X X Extracts X X X X
....). (2) Every income-tax authority shall be deemed to be a Civil Court for the purposes of section 215 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (46 of 2023). Sub-clause (1): Judicial Proceedings under the Bharatiya Nyaya Sanhita, 2023 Sub-clause (1) provides that any proceeding before an income-tax authority under the Act shall be deemed to be a "judicial proceeding" for the purposes of sections 229 and 267, and for the purposes of section 233 of the Bharatiya Nyaya Sanhita, 2023. This is a significant update, as the Bharatiya Nyaya Sanhita, 2023 has replaced the Indian Penal Code, 1860. * Section 229 (BNS, 2023): This section is analogous to Section 193 of the IPC, which deals with punishment for giving or fabricating false evid....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., 1973, which restricts the cognizance of certain offences (such as perjury or fabrication of evidence) except upon a complaint by the court in which the offence was committed. By deeming income-tax authorities to be Civil Courts for this purpose, Clause 257 ensures that prosecution for offences such as perjury committed before income-tax authorities can only be initiated on a complaint by such authority, thus providing a safeguard against frivolous prosecutions and maintaining judicial discipline. Key Features and Legislative Updates * Alignment with New Criminal Codes: Clause 257 updates references from the now-repealed IPC and CrPC to the Bharatiya Nyaya Sanhita, 2023 and Bharatiya Nagarik Suraksha Sanhita, 2023 respectively, ensurin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....codes may arise. Practical Implications The practical effects of Clause 257 are substantial for various stakeholders: * For Taxpayers and Witnesses: Individuals appearing before income-tax authorities are obliged to provide truthful evidence, with the risk of prosecution for perjury or contempt if they fail to do so. * For Income-tax Authorities: The authorities are empowered to maintain procedural discipline and can initiate prosecution for offences committed in the course of proceedings, but only through the procedural safeguards provided by the BNSS, 2023. * For Prosecuting Agencies: Prosecutions for offences such as perjury or fabrication of evidence in tax proceedings can only be initiated on a complaint by the income-tax autho....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... thereby providing a procedural filter. Points of Divergence * Reference to Updated Statutes: * Section 136 refers to the Indian Penal Code, 1860 and the Code of Criminal Procedure, 1973, specifically sections 193 (false evidence), 228 (insult to public servant), 196 (using evidence known to be false), and 195 (prosecution for offences against public justice). * Clause 257 refers to the Bharatiya Nyaya Sanhita, 2023 and Bharatiya Nagarik Suraksha Sanhita, 2023, specifically sections 229, 267, 233, and 215, which are the updated counterparts of the above sections. * Exclusion Clause: * Section 136 expressly excludes the application of Chapter XXVI of the CrPC, 1973 (relating to prosecutions for offences affecting the administratio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nuity in the core purpose and structure of the provision ensures that the basic procedural protections and obligations remain intact, while the modernization ensures continued legal efficacy. Comparative Perspective: Other Jurisdictions Many jurisdictions treat proceedings before tax or revenue authorities with a degree of procedural solemnity akin to judicial proceedings. For example: * United Kingdom: Proceedings before tax tribunals are governed by strict procedural rules, and giving false evidence is subject to prosecution for perjury. * United States: The Internal Revenue Service (IRS) has the power to issue subpoenas, and false testimony before IRS officials can attract criminal liability. However, the Indian approach is distin....