CBDT Amends Rule 225: Removes Arrest Provisions for Income Tax Recovery

Home / Top Stories CBDT Amends Rule 225: No More Arrest For Tax Recovery; Focus Shifts To Property Attachment X CBDT removes arrest provisions from tax recovery rules. CBDT amends Rule 225 of Income-tax Rules, 2026, removing arrest and detention for tax arrears while extending valuer and tax practitioner registration deadline. The Central Board of Direct Taxes (CBDT) has removed provisions allowing arrest and detention of tax defaulters from the prescribed process for recovery of income-tax arrears under the Income-tax Rules, 2026. The changes were notified on September 17 through the Income-tax (Fourth Amendment) Rules , 2026. The amendments relating to Rule 225 have been given retrospective effect from April 1, 2026. The amendment comes as the new Income-tax Act , 2025 and the Income-tax Rules , 2026 came into effect from April 1 this year. What is Rule 225 of the Income-tax Rules, 2026? Rule 225 lays down the procedure for recovering tax arrears under the Income-tax Act, 2025. It covers the steps that tax recovery authorities can take against a person who has outstanding tax dues. The CBDT has now deleted several provisions of the rule that dealt with arrest, detention and civil imprisonment of tax defaulters. These include sub-rules 75 to 83 and sub-rule 91. The amendment also removes the reference to arrest in sub-rule 4 and deletes the words relating to arrest and detention from another provision of the rule. The deleted provisions had prescribed procedures for issuing an arrest warrant, bringing a defaulter before the Tax Recovery Officer, conducting an inquiry into whether the person should be detained and ordering detention in a civil prison. Can the Income Tax Department arrest you for unpaid tax? Under the amended Rule 225, arrest and detention are no longer prescribed methods for recovering tax arrears. The recovery process will continue to include measures such as attachment and sale of movable or immovable property and appointment of a receiver. The amendment, however, is specifically to the prescribed recovery mechanism under Rule 225. It does not, by itself, remove any separate power of arrest that may exist elsewhere under the Income-tax Act, according to tax-law analysis of the amendment. The change follows the government's broader move towards decriminalising certain technical tax defaults under the Finance Act , 2026. The Budget had proposed that certain minor tax-related offences should attract monetary penalties rather than prosecution. Separately, the CBDT has extended the deadline for existing valuers and authorised income-tax practitioners to complete their registration under the new income-tax framework. The deadline, which was earlier September 30, 2026, has now been extended by six months to March 31, 2027. The notification also substitutes Form 169 for registration of valuers under Section 514 of the Income-tax Act, 2025. The revised form requires details relating to qualifications, professional certifications, valuation experience and the classes of assets for which registration is sought. For authorised income-tax practitioners, Form 171 requires applicants to provide details concerning their qualifications and professional experience, along with information relevant to their eligibility. The CBDT said these changes form part of the transition to the new income-tax framework introduced from April 1, 2026.