Who can be designated as a Special Court?

One or more courts of Judicial Magistrates of the first class for the specified areas or cases.

Can a Special Court try other criminal offences?

Yes, but only where the BNSS permits the other offence to be charged at the same trial.

Does Section 495 prescribe a punishment?

No. It governs the designation of Special Courts, not the punishment for an offence.

Home / Income Tax Act 2025 / Section 495

Section 495 Income Tax Act 2025: How Are Special Courts Designated for Tax Prosecution?

Q: Does Section 495 automatically create a Special Court in every city?

No. Designation requires a Central Government notification following consultation with the Chief Justice of the relevant High Court.

Which criminal court can hear a prosecution for an offence under the Income-tax Act, 2025? Section 495 provides for the designation of Special Courts and explains their authority to try connected offences in the same criminal trial.

Quick answer: Under Section 495(1), the Central Government may, after consultation with the Chief Justice of the relevant High Court, designate one or more existing courts of Judicial Magistrates of the first class as Special Courts by notification. The notified area and class of cases determine the designation. Section 496 sets out the related rules on offences triable by Special Courts.

What does Section 495 of the Income-tax Act, 2025 provide?

Section 495, titled Special Courts, appears in Chapter XXII on offences and prosecution. It creates a statutory mechanism for designating magistrate courts to hear income-tax criminal cases. The provision is procedural: it does not itself create a new tax offence, prescribe a punishment, or automatically establish a Special Court in every district.

A designation must be made by the Central Government through a notification, following consultation with the Chief Justice of the High Court. Whether a particular court is designated must therefore be checked against the applicable notification and its territorial or subject-matter coverage.

Section 495(1), 495(2) and 495(3) explained

Section 495(1): Designation by notification

The Central Government, in consultation with the Chief Justice of the High Court, may designate one or more courts of Judicial Magistrates of the first class as Special Courts for the trial of offences punishable under Chapter XXII. A notification may specify the geographical area, particular cases, or a class or group of cases to be heard by the designated court.

Section 495(2): Meaning of High Court

For this section, the expression High Court refers to the High Court of the State in which the Judicial Magistrate of the first class was functioning immediately before the court's designation as a Special Court. This identifies the High Court whose Chief Justice must be consulted under subsection (1).

Section 495(3): Trial of connected offences

When trying an offence under the Income-tax Act, a designated Special Court may also try another offence that can lawfully be charged against the same accused at the same trial under the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS). This power depends on the BNSS rules permitting a joint trial; it is not an unrestricted power to combine unrelated charges.

Relevant statutory definitions and expressions

Special Court: A court of Judicial Magistrate of the first class specifically designated by Central Government notification under Section 495(1) for the notified cases or areas.
Judicial Magistrate of the first class: A judicial magistrate's court under the criminal procedure framework. Section 495 designates such a court rather than creating a new independent judicial institution.
Notification: The formal governmental instrument specifying the court and the area or categories of cases covered by the designation.
High Court: For Section 495, the High Court identified by subsection (2), based on the State in which the magistrate was functioning before designation.
Connected offence: For subsection (3), another offence capable of being charged and tried together under the applicable BNSS provisions.

How do you identify the competent Special Court?

Identify the alleged offence. Determine which provision in Chapter XXII is invoked, such as Section 478 or Section 482.
Check the Central Government notification. Confirm that a court has been designated for the relevant area or class of cases under Section 495.
Read Section 496. It governs trial by the designated Special Court and relevant transitional arrangements; designation and trial jurisdiction must be considered together.
Check the prosecution requirements. Section 491 contains requirements relating to prosecution authorisation and compounding.
Consider any connected charges. Under Section 495(3), additional offences may be heard together only when the BNSS permits the joint trial.

Important distinction: The Central Government's power to designate a Special Court does not mean that every magistrate court is automatically a Special Court. The operative notification and the rules in Section 496 matter in each case.

Practical illustrations

Example 1: Notified court for an area

Suppose the Central Government designates a particular Judicial Magistrate First Class court as the Special Court for income-tax offences arising in a specified district. Subject to the notification and Section 496, prosecutions falling within that district and the notified class of cases would be tried by that court.

Example 2: No designation established

If a party cannot identify a relevant designation notification, it should not assume that an ordinary magistrate court is a Special Court. The applicable trial forum must be determined under the statute and the notifications in force.

Example 3: Connected criminal charges

An income-tax prosecution may involve another alleged offence arising from the same transaction. The Special Court can try that additional charge only if the BNSS allows it to be charged at the same trial, as contemplated by Section 495(3).

How does Section 495 compare with the Income-tax Act, 1961?

Section 495 broadly corresponds to Section 280A of the Income-tax Act, 1961, which also dealt with designation of Special Courts. For current prosecutions, practitioners should consult the 2025 Act, applicable commencement and saving provisions, relevant notifications, and the BNSS rather than assume every procedural detail of an older case remains unchanged.

Read alongside Section 496 (offences triable by Special Court), Section 497 (trial as summons case) and Section 498 (application of BNSS). These related links are subject to publication of the corresponding pages.

Frequently asked questions

Does Section 495 automatically create a Special Court in every city?

No. A designation requires a Central Government notification after consultation with the Chief Justice of the relevant High Court.

Who may be designated as a Special Court under Section 495?

One or more courts of Judicial Magistrates of the first class may be designated for specified areas or cases.

Can a Special Court try a non-income-tax offence?

Yes, where the accused may lawfully be charged with that other offence at the same trial under the BNSS, as provided in Section 495(3).

Does Section 495 prescribe imprisonment or a fine?

No. It deals with the designation and trial powers of Special Courts. Punishments, where applicable, are specified in the relevant offence provisions.

What is the difference between Sections 495 and 496?

Section 495 governs the designation of Special Courts and connected offences. Section 496 sets out which offences are triable by the designated Special Court and related procedural rules.

Official statutory source

See the Income-tax Act, 2025 as amended by the Finance Act, 2026, Chapter XXII, Sections 495 and 496. For an actual prosecution, verify the current Central Government designation notification and the applicable provisions of the BNSS, 2023.

This article explains the statutory framework as at November 2026. The correct court for a particular case depends on the notification, location, charges and procedural history.