# Notification No. 120/2026 [F. No. 370142/30/2026-TPL] / G.S.R. 822(E) : Income tax (Fourth Amendment) Rules, 2026 Author: C.K. Gupta Published: 2026-09-20 Categories: Manage Business, Taxation Tags: CBDT Notification 2026, Direct Tax Updates, Finance Ministry Notification, G.S.R. 822(E), Income Tax Act 2025, Income Tax Amendment, Income Tax Circulars, Income Tax Department, Income Tax Fourth Amendment Rules 2026, Income Tax Latest News, Income Tax Notification 120/2026, Income Tax Notification September 2026, Income Tax Rules 2026, New Income Tax Rules, Notification No. 120/2026, tax compliance 2026, Tax Updates India, Taxgst.in Source: https://taxgst.in/notification-no-120-2026-f-no-370142-30-2026-tpl/ CBDT Notification No. 120/2026, G.S.R. 822(E), dated **17 September 2026**, introduces the Income-tax (Fourth Amendment) Rules, 2026. It amends the **Income-tax Rules, 2026** under the Income-tax Act, 2025—not the Income-tax Rules, 1962. The notification corrects cross-references, changes one digital-signature wording to electronic communication, removes residual arrest-and-detention machinery from Rule 225 with retrospective effect from 1 April 2026, extends certain registration deadlines to 31 March 2027, and substitutes Forms 169 and 171. **Also Read-[Form 121 of Income Tax: New Single TDS Declaration for All Eligible Taxpayers 2026](https://taxgst.in/form-121-of-income-tax/)** ## Quick Summary **Important:** This notification is primarily a rules-alignment and procedural amendment. It is not a notification substituting ITR-1, ITR-2, ITR-3, ITR-4, ITR-6, ITR-V or ITR-Ack for AY 2026-27. Taxpayers should not assume that an ITR form has changed merely because Notification No. 120/2026 has been issued. - **Notification:** No. 120/2026 / G.S.R. 822(E) - **Title:** Income-tax (Fourth Amendment) Rules, 2026 - **Issuing authority:** Central Board of Direct Taxes (CBDT), Ministry of Finance - **Date:** 17 September 2026 - **Parent framework:** Income-tax Act, 2025 and Income-tax Rules, 2026 - **Retrospective commencement:** Rules 2–4 are deemed effective from 1 April 2026 - **Publication-based commencement:** Rules 5–8 take effect from publication in the Official Gazette - **Main impact:** Rule 225 recovery machinery, registration deadlines, and Forms 169 and 171 ## What Does Notification No. 120/2026 Amend? Notification No. 120/2026 further amends the Income-tax Rules, 2026. It is made under section 533 read with sections 262, 273, 413, 514 and 515 of the Income-tax Act, 2025. The notification contains eight operative rules. Its changes are spread across Rule 160, Rule 176, Rule 225, Rule 246, Rule 256, Form No. 169 and Form No. 171. The date must be stated accurately. The notification is dated **17 September 2026**, although an article may be published or updated on 18, 19 or 20 September. Rules 2 to 4 are deemed to have come into force on 1 April 2026, while rules 5 to 8 come into force on the date of publication in the Official Gazette. ## What Are the Main Changes Under the Notification? | Rule / provision | Change | Practical significance | | --- | --- | --- | | Rule 160 | Cross-reference changes from “(i)” to “(a)” in sub-rules (3) and (4) | Drafting and numbering correction | | Rule 176(3)(a)(ii) | “By affixing digital signature” replaced with “by way of an electronic communication” | Relevant to the manner of compliance under the rule; read the complete rule before changing internal procedures | | Rule 225 | Several arrest-and-detention references and related sub-rules omitted or modified | Removes residual recovery-rule machinery connected with arrest and detention; other recovery powers remain subject to the Act | | Rule 246(4) | Deadline changed from 30 September 2026 to 31 March 2027 | Applies to the relevant valuer-registration process | | Rule 256(4) | Deadline changed from 30 September 2026 to 31 March 2027 | Applies to the relevant authorised income-tax practitioner registration process | | Form 169 | Form substituted for valuer registration under section 514 | Applicants must use the substituted form and check fee, asset class and qualification requirements | | Form 171 | Form substituted for authorised income-tax practitioner registration under section 515 | Applicants must use the revised application and provide eligibility and disqualification details | ## How Does the Rule 225 Amendment Affect Tax Recovery? Rule 225 contains procedural provisions relating to recovery of tax arrears under the Income-tax Rules, 2026. Notification No. 120/2026 omits sub-rule (4)(c), changes wording in sub-rule (19), corrects a cross-reference in sub-rule (56), omits sub-rules (75) to (83) and (91), and removes the words “except arrest and detention” from sub-rule (87). The practical effect is the removal of residual rule-level machinery concerning arrest and detention. The change should not be described as abolition of all tax-recovery powers or as cancellation of outstanding tax demands. Recovery mechanisms such as attachment, sale of property, appointment of a receiver, and other statutory measures remain governed by the applicable provisions of the Act and rules. Rules 2 to 4 are deemed effective from 1 April 2026. This retrospective commencement is important because the parent statutory framework had already been changed from that date. However, the notification itself does not provide a case-by-case answer for every warrant, notice or proceeding that may have arisen during the intervening period. A person involved in an actual recovery proceeding should examine the case file and obtain professional legal advice rather than relying only on a general article. ### What Does This Mean for a Taxpayer With Outstanding Arrears? - The outstanding demand does not automatically disappear. - Interest and other consequences continue according to the applicable law. - Attachment, garnishee action, property recovery and other lawful mechanisms may remain available where authorised. - Moving or concealing assets to defeat recovery can create additional legal exposure. - If the demand is disputed, the taxpayer should examine rectification, appeal, stay or other available remedies promptly. **Practical explanation:** The September amendment removes specified arrest-and-detention machinery from the rules. It should not be interpreted as a general amnesty, a stay of demand, or a restriction on every other recovery method. ## How Do the Registration Deadlines Change? Rules 5 and 6 extend the deadline in Rule 246(4) and Rule 256(4) from **30 September 2026 to 31 March 2027**. These provisions relate to registration processes for valuers and authorised income-tax practitioners. The extension is separate from the Rule 225 recovery changes. | Applicant category | Earlier date | Revised date | Action | | --- | --- | --- | --- | | Valuer registration | 30 September 2026 | 31 March 2027 | Check eligibility, asset class, documents and fee | | Authorised income-tax practitioner registration | 30 September 2026 | 31 March 2027 | Review qualifications, existing registration and disqualification declarations | ## What Is Changed in Form No. 169? Form No. 169 is the application for registration as a valuer under section 514 of the Income-tax Act, 2025. The substituted form asks for personal details, PAN, address, contact information, the class of asset for which registration is requested, qualifications, employment and practice details, experience during the preceding three years, Wealth-tax Act registration details and disqualification declarations. The form lists separate asset classes, including immovable property, agricultural land, plantations, forests, mines and quarries, securities and business assets, machinery and plant, jewellery, works of art, life interests and other assets. A separate form is required for different classes of assets. The form also states that a fee of **₹10,000** is payable, except for valuers already registered under the Wealth-tax Act, 1957, subject to the terms stated in the notification. ## What Is Changed in Form No. 171? Form No. 171 is the application for registration as an authorised income-tax practitioner under section 515 of the Income-tax Act, 2025. It contains personal and residential details, PAN, contact information, principal place of profession, partnership-firm details where applicable, educational qualifications, proof of qualifications, existing registration under the Income-tax Act, 1961 and declarations concerning disqualification under section 515. Applicants should not treat the substituted form as an automatic grant of registration. Eligibility, supporting documents, statutory declarations and the decision of the competent authority continue to matter. The extended deadline gives additional time, but applicants should not wait until the final date if documents or professional eligibility checks are incomplete. ## Does Notification No. 120/2026 Change ITR Forms for AY 2026-27? The notification text described here does not substitute ITR-1, ITR-2, ITR-3, ITR-4, ITR-6, ITR-V or ITR-Ack. Therefore, the earlier claim that Notification No. 120/2026 “completes an ITR form overhaul” by substituting ITR-3 should be removed. ITR form applicability must be checked against the specific notification and instructions applicable to the relevant assessment year. Similarly, taxpayers should not use this notification alone to conclude that eligibility for two house properties, presumptive taxation, verification windows or individual ITR schedules has changed. Those matters require reference to the separate form notifications, statutory provisions, portal utilities and current departmental instructions. ## What Should Taxpayers, Practitioners and Employers Do Next? - Download and read the complete notification rather than relying only on a headline. - If you handle recovery matters, review whether any internal template still refers to the omitted arrest-and-detention provisions. - Do not assume that the notification cancels a demand or prevents other recovery action. - If applying as a valuer, review Form 169, asset-class requirements, qualification evidence and the ₹10,000 fee rule. - If applying as an authorised income-tax practitioner, review Form 171 and all eligibility and disqualification declarations. - Update compliance calendars to reflect 31 March 2027 for the relevant registration deadlines. - Keep the notification, applicable Act provisions and subsequent departmental instructions together in the compliance file. ## Frequently Asked Questions ### What is Notification No. 120/2026? It is the Income-tax (Fourth Amendment) Rules, 2026, notified by CBDT on 17 September 2026 as G.S.R. 822(E). It amends the Income-tax Rules, 2026 in relation to cross-references, electronic communication, recovery-rule provisions, registration deadlines and Forms 169 and 171. ### Does the notification abolish all income-tax recovery powers? No. It removes specified arrest-and-detention machinery from Rule 225. Other recovery mechanisms remain subject to the applicable statutory provisions and rules. ### From which date are the Rule 225 changes effective? Rules 2 to 4, which include the Rule 225 changes, are deemed to have come into force from 1 April 2026. The effect of a particular past proceeding should be examined on its own facts. ### What is the new deadline for valuer registration? The relevant deadline in Rule 246(4) is extended from 30 September 2026 to 31 March 2027. ### What is the new deadline for authorised income-tax practitioner registration? The relevant deadline in Rule 256(4) is extended from 30 September 2026 to 31 March 2027. ### Does Notification No. 120/2026 replace ITR-3? The notification text covered in this article does not replace ITR-3. ITR form changes must be verified from the separate notification or instruction specifically governing the relevant assessment year. ### Where can I verify the notification? Use the official Income Tax Department/CBDT websites and the Official Gazette. Check the notification number, G.S.R. number, date and complete text before making a legal or compliance decision. ## Sources and Official Resources - [Income Tax e-Filing Portal](https://www.incometax.gov.in/iec/foportal) - [Income Tax Department / CBDT website](https://incometaxindia.gov.in) - [e-Gazette of India](https://egazette.nic.in) **Disclaimer:** This article is for general information and compliance awareness. It is not a substitute for reading the notification, the applicable statute, subordinate legislation, departmental instructions or professional legal advice. Recovery proceedings and registration applications should be reviewed on the basis of the complete record. ### Share this: - [Share on Facebook Opens in new window Facebook](https://taxgst.in/notification-no-120-2026-f-no-370142-30-2026-tpl/?share=facebook) - [Share on X Opens in new window X](https://taxgst.in/notification-no-120-2026-f-no-370142-30-2026-tpl/?share=x) - ### Like this: Like Loading… ### *Related*