Taxpayer Rights under Income-tax Act, 2025 Explained
The Income-tax Act empowers tax authorities with wide investigative and assessment powers. At the same time, it equally safeguards the rights of taxpayers. Under the Income-tax Act, 2025, these rights continue with stronger emphasis on fairness, transparency, and accountability.
Awareness of taxpayer rights is not optional. It is essential for protecting oneself against arbitrary or excessive action.
Right to Fair and Reasonable Treatment
Every taxpayer has the right to be treated with dignity, courtesy, and fairness by tax authorities.
Actions must be:
Lawful
Proportionate
Free from harassment or coercion
Tax administration is governed by the principle that power must be exercised responsibly.
Right to Proper Notice and Information
No adverse action can be taken without:
Issuance of valid notice
Clear communication of reasons
Adequate time to respond
Notices must specify:
Relevant section of law
Nature of information required
Time limits for compliance
Vague or mechanical notices are legally challengeable.
Right to Be Heard
Before any addition, penalty, or adverse order, the taxpayer has the right to:
Submit explanations
Furnish documents
Seek adjournments for genuine reasons
This principle of natural justice remains fundamental under the new law.
Orders passed without granting reasonable opportunity are unsustainable.
Right Against Arbitrary Assessment
Assessments must be:
Based on evidence
Supported by reasons
Confined to issues raised during proceedings
Estimated or ad-hoc additions without material backing violate taxpayer rights.
The Assessing Officer is required to pass a reasoned and speaking order.
Rights During Search and Survey
Even during search or survey, taxpayers retain important rights, including:
Right to see authorisation
Right against illegal seizure
Protection of personal dignity
No coercion for confessions
Reliance on documentary evidence over oral statements
Extraordinary powers do not override constitutional protections.
Right to Appeal and Remedy
Every taxpayer has the statutory right to:
File appeal against assessment orders
Seek rectification of mistakes
Approach appellate authorities and courts
The appellate framework ensures checks and balances in tax administration.
Right to Confidentiality and Data Protection
Information furnished by taxpayers is protected and cannot be misused.
With increased digitisation, data security and lawful use of information have become integral components of taxpayer rights.
Conclusion
Under the Income-tax Act, 2025, taxpayer rights are not symbolic. They are enforceable legal protections.
Knowing these rights empowers taxpayers to:
Respond confidently
Prevent misuse of authority
Ensure lawful assessments
A strong tax system is built not only on collection of revenue, but on trust, fairness, and rule of law.
Written by:
Abhishek Gupta
Chartered Accountant
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