Income Tax Act, 2025  ·  Chapter IV — Computation of Total Income  ·  Section 66

Section 66
Interpretation

IT Act 2025 Chapter IV Effective 1 April 2026 Old: 125 28 to 44DA
New Provision
Section 66, IT Act 2025
Replaces (IT Act 1961)
125 28 to 44DA
Chapter
Chapter IV — Computation of Total Income
Effective From
1 April 2026
Statutory Text — Section 66

r the purposes of Part D of this Chapter,— (1) “agreement”, for the purposes of section 26(2)(h), includes any arrangement or understanding or action in concert,— (A) whether or not such arrangement, understanding or action is formal or in writing; or (B) whether or not such arrangement, understanding or action is intended to be enforceable by legal proceedings; (2) “banking company” means a company to which the Banking Regulation Act, 1949 applies and includes any bank or banking institution referred to in section 51 of that Act; (3) “commission or brokerage” shall have the meaning assigned to it in section 402(7); (4) “commodities transaction tax” shall have the same meaning as assigned to it under Chapter VII of the Finance Act, 2013; (5) “fees for technical services” shall have the meaning assigned to it in section 9(7)(b); (6) “housing finance company” means a public company formed or registered in India with the main object of carrying on the business of providing long-term finance for construction or purchase of houses in India Direct Taxes Committee 12 5

for residential purposes; (7) “Indian Institute of Technology” shall have the same meaning as that of “Institute” defined in section 3(g) of the Institutes of Technology Act, 1961; (8) “Keyman insurance policy” shall have the meaning assigned to it in Schedule II (Note 1); (9) “limited liability partnership” shall have the same meaning as assigned to it in section 2(1)(n) of the Limited Liability Partnership Act, 2008; (10) “long-term finance”, for the purposes of section 32(e), means any loan or advance where the terms under which moneys are loaned or advanced provide for repayment along with interest thereof during a period of not less than five years; (11) “micro enterprise” shall be an enterprise classified as such under the notification in this behalf by the Central Government under the Micro, Small and Medium Enterprises Development Act, 2006; (12) “mineral oil” includes petroleum and natural gas; (13) “moneys payable” in respect of any tangible asset [as referred to in section 33(12)(a)(i)] includes— (a) any insurance, salvage or compensation moneys payable in respect thereof; (b) where the asset is sold, the price for which it is sold; (14) “non-scheduled bank” means a banking company as defined in section 5(c) of the Banking Regulation Act, 1949, which is not a scheduled bank; (15) “paid” means, except for section 37, actually paid or incurred according to the method of accounting upon the basis of which the profits or gains are computed under the head “Profits and gains of business or profession”; (16) “permanent establishment” shall have the meaning assigned to it in section 173(c); (17) “plant” includes ships, vehicles, books, scientific apparatus and surgical equipment used for the business or profession but does not include tea bushes or livestock or buildings or furniture and fittings; (18) “predecessor entity” means–– (a) the amalgamating Indian company in the case of amalgamation; (b) the demerged Indian company, in the case of demerger;

Shahi & Co. — Our Understanding
This section falls under Chapter IV which governs the computation of total income under all five heads: Salaries, House Property, Business & Profession, Capital Gains, and Other Sources.
Practical Note: All income earned by a taxpayer in a tax year must be computed under one of these heads. Proper classification determines the applicable deductions, set-off rules, and tax rates.
Shahi & Co., Chartered Accountants
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Disclaimer: This is a reproduction of Section 66 of the Income Tax Act, 2025 (No. 30 of 2025) as published in the Official Gazette of India (CG-DL-E-22082025-265620) for informational and reference purposes only. Shahi & Co., Chartered Accountants makes no warranty as to completeness or accuracy. For the official authenticated text refer to egazette.gov.in or incometaxindia.gov.in. This does not constitute legal or tax advice.