Comparison of section 305 "Right of representative assessee to recover tax paid." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

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.... affects representative assessees, principals, and tax authorities involved in assessment and recovery; no explicit effective date is stated in the text. Background & Scope Clause 305, Income Tax Bill, 2025 (Old Version). Context: general provisions governing "Representative assesses" within the Bill. Coverage: rights of a representative assessee who pays sums under the Act to recover such sums from the person on whose behalf payment was made, and the correlative right to retain monies in his possession. The clause contains four sub-sections establishing (1) general right of recovery or retention; (2) power to retain estimated liability; (3) procedure to obtain a certificate from the Assessing Officer in case of disagreement; and (4) a ca....

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....son shall not exceed the amount specified in such certificate, except to the extent to which the representative assessee or person may at such time have in his hands additional assets of the principal. Interpretation The text establishes a statutory entitlement in favour of a representative assessee both in contract-like terms (right to recover sums paid) and in possessory terms (right to retain monies in his representative capacity). The presence of an entitlement to retain "estimated liability" (sub-section (2)) and the mechanism of a certificate from the Assessing Officer (sub-section (3)) indicate a legislative intent to provide a practical and enforceable method for representative assessees to secure themselves against liability and ....

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.... (2). If the principal disputes the amount to be retained, the person obtains a certificate under sub-section (3) from the Assessing Officer specifying INR 1.8 lakh; sub-section (4) then limits recoverability to INR 1.8 lakh unless the representative holds further assets of the principal. * Example 3: Not stated in the document: procedural timelines for securing the certificate or consequences for failure to obtain one. Interplay The clause refers to "this Chapter" for the concept of estimated liability, implying interaction with other provisions of the Bill governing assessment and tax liability; those cross-references or rules are Not stated in the document. The role of the Assessing Officer is central, but procedural rules, forms, or....

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....rows the statutory cap so that the certificate amount limits recoverability only at final settlement; however, the carve-out for "additional assets of the principal" remains. This may affect timing disputes-under the enacted text, the certificate amount is a definitive cap at settlement, potentially allowing a representative who later acquires further assets of the principal to recover beyond the certificate amount; conversely, it may prevent recovery beyond the certificate amount at settlement even if interim circumstances change. The Bill's earlier wording lacked the temporal qualifier, which could have been interpreted to cap recovery permanently by reference to the certificate. The enacted change therefore clarifies temporal applica....