Comparison of Section 166 "Reference to Transfer Pricing Officer." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

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....gs, the Income-tax Department (Assessing Officers and TPOs), and compliance workflows around transfer pricing. Effective date or enactment timing: Not stated in the document. Background & Scope Statutory hooks: Clause 166 (Income Tax Bill, 2025 - Old Version); cross-references to sections 165, 171, 172, 286, 287, 288, 246, 252, 253 and Chapter XVI-B are included. The provision governs referral, notice and determination procedures for arm's length pricing, the temporal application of such determinations to subsequent tax years via an opt-in mechanism, powers of the Transfer Pricing Officer, correction of apparent mistakes and administrative guidelines. Definitions: "Transfer Pricing Officer" is defined in the Clause (last sub-section) ....

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....ent tax years. The procedural steps (notice, hearing, consideration of documents, and written order) indicate an administrative due-process architecture. The reference to prescribed form, manner and period for exercising the opt-in indicates delegated rule-making scope; similar language governs conditions attached to validating options. Exceptions/Provisos - No reference under sub-section (1) shall be made if the TPO has declared an option exercised by the assessee under sub-section (9) to be valid for that tax year (sub-section (2)). - If a reference is made for a tax year for which an option has been or will be declared valid, sub-section (1) shall have effect as if no reference were made (sub-section (3)). - Sub-section (9) provides ....

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....lid. The TPO then examines and determines arm's length price for those two years and sends orders; the Assessing Officer recomputes income for those years as per section 288. (This scenario presumes the option and declaration steps set out in sub-sections (9) and (12).) Interplay Clause 166 cross-references section 165(4) for the substantive method of arm's length determination, section 171(2) for documents/information referenced at hearing, section 172 (reporting obligations) and sections 286/287/288 concerning limitation, amendment/rectification and recomputation procedures. It disapplies the opt-in in relation to Chapter XVI-B proceedings. The TPO is empowered to exercise specified powers u/ss 246(1)(a)-(d), 252(1)(a) or 253 fo....

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.... Parliamentary laying and numbering Bill: Parliamentary laying provision is sub-section (17); definition of TPO is sub-section (18). Act: Parliamentary laying provision appears as sub-section (16) and definition of TPO as sub-section (17). Recomputation reference for two years Bill sub-section (12) directs the Assessing Officer to recompute income "as per the provisions of section 288." Act sub-section (12) references recomputation "as per the provisions of section 288(2)." (more specific). Practical impact of those differences: the Act's clearer timing language reduces ambiguity about the deadline for TPO orders; the change from references to subsections of section 286 (i)/(h) could affect which circumstances trigger limit....