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Section 246 Income Tax Act 2025: Can Income Tax Officers Summon You and Demand Evidence?

Section 246 gives specified income-tax authorities civil-court-like powers to require discovery, summon persons, examine witnesses on oath, demand books and documents, and issue commissions. The provision also regulates investigative use of these powers and retention of documents.

Applicable law: Income-tax Act, 2025, Chapter XIV, Part B (Powers), effective from 1 April 2026. Section 246 corresponds broadly to section 131 of the Income-tax Act, 1961. It is distinct from section 246 of the 1961 Act, which concerns appeals.

1. What powers does Section 246(1) give income-tax authorities?

For the purposes of the Act, the Assessing Officer, Joint Commissioner, Joint Commissioner (Appeals), Commissioner (Appeals), Commissioner or Principal Commissioner, Chief Commissioner or Principal Chief Commissioner, and the Dispute Resolution Panel referred to in section 275(17)(a) have the same powers as a civil court trying a suit, but only for the specified matters:

Discovery and inspection: requiring relevant information or examination of documents.
Attendance and examination on oath: compelling a person, including an officer of a banking company, to attend and answer questions under oath.
Production of records: requiring books of account and other documents to be produced.
Issuing commissions: authorising the taking of evidence through a commission where legally appropriate.

These are enumerated procedural powers. Section 246 does not give every income-tax officer every power available to a civil court for every purpose.

2. Can a summons be issued when no assessment proceeding is pending?

Yes, in the specific situations covered by section 246(2). The subsection extends the powers in section 246(1) to designated authorities even without proceedings pending against the person or class of persons:

Section 246(2)(a): a Board-notified income-tax authority not below Assistant Commissioner rank may conduct an inquiry or investigation concerning an agreement referred to in section 159.
Section 246(2)(b): specified investigation-wing authorities, including Directors and Assistant Directors, may inquire into suspected concealment of income within their jurisdiction where they have reason to suspect concealment or likely concealment.
Section 246(2)(c): an authorised officer under section 247(1) may exercise these powers before or during the specified search-related action, subject to the statutory reason-to-suspect requirement.

Whether a particular summons is lawful depends on the issuing officer's statutory authority, jurisdiction, purpose and the facts of the inquiry.

3. Can books of account and documents be impounded?

Section 246(3): Power to impound

An authority exercising powers under subsections (1) or (2) may, subject to applicable rules, impound and retain books of account or other documents produced before it in a proceeding under the Act.

Section 246(4): Recorded reasons and retention period

Where the Assessing Officer or Assistant Director impounds records under subsection (3), that officer must record the reasons. Such records may be retained for up to 15 days, excluding holidays; retention beyond that period requires the prior sanction of the approving authority.

Important distinction: A requirement to produce documents, an order impounding produced records and a search or seizure under section 247 are different legal actions. The specific statutory conditions for each must be examined separately.

4. Relevant statutory concepts and definitions

Assessing Officer: An income-tax authority exercising assessment functions as assigned under the Act and applicable jurisdictional orders. The precise statutory meaning and authority should be read with the Act's definition and jurisdiction provisions.

Discovery and inspection: Procedural mechanisms to identify and examine relevant evidence; section 246(1)(a) confers the specified civil-court-type power.

Examination on oath: Recording answers under an oath administered by an authorised authority pursuant to section 246(1)(b).

Books of account: Accounting records relevant to financial transactions, including records in electronic form where covered by the Act's applicable definitions and requirements.

Impounding: Taking custody of books or documents produced before an authority, subject to section 246(3), applicable rules and, for the officers specified in subsection (4), the reasons and retention safeguards.

Approving authority: The authority whose prior sanction is required for extended retention under section 246(4); its identity must be determined under the applicable statutory definition and authorisation framework.

5. What should a taxpayer do after receiving a summons?

Verify the section invoked, issuing authority, notice details, date, place or electronic mode of compliance.
Identify the requested records and preserve originals and electronic evidence.
Respond accurately and within the prescribed time; request clarification or reasonable additional time when necessary.
Keep copies of documents submitted and obtain acknowledgement of any originals retained.
Where records are impounded, seek the recorded reasons and examine the applicable approval requirements for continued retention.

Example: During an investigation into suspected concealed income, an authorised investigation officer may summon a bank officer to explain transactions and produce relevant records, provided the applicable jurisdictional and statutory conditions are satisfied.

6. Frequently asked questions

Can an income-tax officer summon a person who is not the assessee?

Yes. Section 246(1)(b) refers to attendance of any person, including a banking-company officer, where the summons falls within the officer's lawful powers.

Does every summons require an assessment case to be pending?

No. Section 246(2) expressly provides specified investigation and inquiry powers even where no proceeding is pending, subject to its conditions.

Can the officer keep original documents indefinitely?

No unrestricted power is given. Impounding is subject to rules; under section 246(4), an Assessing Officer or Assistant Director must record reasons and obtain prior sanction for retention beyond 15 days excluding holidays.

Is section 246 of the 2025 Act an appeals provision?

No. Section 246 of the Income-tax Act, 2025 concerns discovery and production of evidence. The identically numbered section in the Income-tax Act, 1961 addresses a different subject.

7. Official statutory references

Official Section 246 text Income-tax Act 2025 (amended text)Official section mapping

Last reviewed: 11 November 2026. This article provides general legal information; examine the statutory text, rules and applicable notifications for a particular proceeding.