Section 533 · Miscellaneous

Section 533 of the Income-tax Act, 2025 — Power to Make Rules (CBDT)

By CA Rajat Agrawal Updated 05 Jul 2026 Chapter XXIII

📜 What the law says — Section 533, Income-tax Act 2025

533. (1) The Board may, subject to the control of the Central Government, by notification, make rules for carrying out the purposes of this Act. (2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters:— (a) the ascertainment and determination of any class of income; (b) the manner in which and the procedure by which the income shall be arrived at in the case of— (i) income derived in part from agriculture and in part from business; (ii) persons residing outside India; (iii) operations carried out in India by a non-resident; (iv) transactions or activities of a non-resident; (v) an individual who is liable to be assessed under section 99(3) and (4); (c) the determination of the value of any perquisite chargeable to tax under this Act in such manner and on such basis as appears to the Board to be proper and reasonable; (d) the percentage on the written down value which may be allowed as de- preciation for buildings, machinery, plant or furniture; (e) the matters specified in section 62; (f) the conditions or limitations subject to which any payment of rent made by an assessee shall be deducted under section 134; (g) the matters specified in Chapter XI; (h) the time within which any person may apply for the allotment of a Permanent Account Number, the form and the manner in which such application may be made and the particulars which such application shall contain and the transactions with respect to which Permanent Account Number shall be quoted on documents relating to such transactions under section 262; (i) the documents, statements, receipts, certificates or audited reports which may not be furnished along with the return but shall be produced before the Assessing Officer on demand under section 263(2)(a); (j) the class or classes of persons who shall be required to furnish the return of income in electronic form; the form and the manner of furnishing the said return in electronic form; documents, statements, receipts, certificates or reports which shall not be furnished with the return in electronic form and the computer resource or electronic record to which such return may be transmitted under section 263(2)(a); (k) the cases, the nature and value of assets, the limits and heads of expendi- ture and the

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In plain language

What Section 533 says in plain English

Section 533 of the Income-tax Act, 2025 is the enabling provision that gives the Central Board of Direct Taxes (CBDT) the power to make rules for carrying out the purposes of the Act. Parliament writes the main law (the Act), but it cannot possibly spell out every form, format, procedure, threshold or method of computation. So the Act delegates that detailed, technical work to the CBDT. Rules made under this section are called subordinate legislation or delegated legislation.

It is the exact successor to Section 295 of the Income-tax Act, 1961, and it is the legal engine behind the brand-new Income-tax Rules, 2026 — notified by the CBDT via Notification No. 22/2026 dated 20 March 2026 and in force from 1 April 2026. Every rule, form (ITR-1 to ITR-7, Form 16, Form 26AS, Form 15G/15H, Form 10E and hundreds more), and prescribed procedure draws its legal validity from Section 533.

Who exercises the power, and who controls it

Rule-maker: the CBDT (the Board), a statutory body under the Central Board of Revenue Act, 1963.
Subject to the control of the Central Government: the Board does not act freely — it operates under the supervision of the Ministry of Finance. This "dual-layer" oversight keeps the executive accountable while allowing quick technical updates.
Method: rules are made only by notification in the Official Gazette, so they are public and citable.

What kinds of matters rules can cover

The section uses deliberately wide language — rules may be made "for carrying out the purposes of this Act" — and then gives an illustrative, non-exhaustive list. Because the list is only illustrative, the Board's power extends beyond the items expressly named. Typical matters include:

Ascertainment and valuation of perquisites, market value of assets, and fair market value.
The manner of computing particular incomes, deductions and reliefs where the Act leaves method to be "prescribed".
Forms, returns, statements, certificates and registers and the manner of their furnishing (including electronic/faceless procedures).
Procedure for registration of trusts/charities, approval of funds, and the like.
Rules for maintenance of books of account and audit report formats.
Rate of exchange for converting foreign income, and rules on TDS/TCS procedure.

The key safeguards and limits

Cannot override the Act: a rule cannot go beyond, contradict or enlarge the parent Act. If a rule conflicts with a section, the section prevails and the rule is ultra vires (void).
Laying before Parliament: rules must be laid before both Houses. Parliament can modify or annul a rule, though this is usually an informational scrutiny rather than a blocking step.
Limited retrospective effect: as under old Section 295, rules generally operate prospectively; retrospective rules that prejudicially affect a taxpayer are restricted.
Publication: without Gazette notification, a rule has no legal force.

How it interacts with related sections

Section 533 is a miscellaneous / machinery provision. It pairs with the CBDT's power to issue instructions and directions and to grant relief in genuine hardship. Wherever an operative section of the Act says a thing shall be done "in the prescribed manner" or "in the prescribed form", the word "prescribed" means prescribed by rules made under Section 533. So this one section quietly powers thousands of "prescribed" references scattered throughout the Act.

Practical implications for a normal taxpayer

The ITR forms, due dates format, and e-filing utilities you use every year exist because of rules made under Section 533.
When the government tweaks a limit or a form mid-year, it usually does so by amending a Rule (fast, via notification) rather than by amending the Act (slow, needs Parliament).
If you ever feel a rule demands more than the Act allows, you can challenge the rule as ultra vires — a right the courts have upheld for decades under the old Section 295.

💡 Example

Worked example 1 — how a "prescribed" limit flows from Section 533. Suppose Section on TDS says tax must be deducted on interest above the "prescribed" threshold, and the CBDT sets that threshold at ₹50,000 in a rule. Ramesh, a bank, pays Priya ₹62,000 interest. Because the ₹50,000 limit lives in a Rule (made under Section 533), the bank deducts TDS on the full ₹62,000. If next year the CBDT raises the limit to ₹1,00,000 by a simple Gazette notification — no new Act needed — the same ₹62,000 payment would attract no TDS. The number changed; the parent section did not.

Worked example 2 — valuation of a perquisite. Anita gets a rent-free company flat. The Act says the perquisite is taxable "as prescribed". The Rules (under Section 533) fix the value at, say, 10% of salary in a metro city. If Anita's salary is ₹12,00,000, the taxable perquisite is ₹1,20,000, added to her income. The exact 10% figure is a rule, so the CBDT can revise it without amending the Act.

A short relatable story. Think of Parliament as an architect who signs off the building's master plan (the Act), and the CBDT as the interior contractor who decides the exact tiles, switch positions and door handles (the Rules). Section 533 is the contract clause that authorises the contractor to do that fit-out work — but only within the approved plan, under the owner's (Central Government's) supervision, and with the plan always overriding any fit-out choice that clashes with it.

Aspect	Section 533 — Income-tax Act, 2025	Section 295 — Income-tax Act, 1961 (old)
Who makes the rules	CBDT (the Board)	CBDT (the Board)
Oversight	Subject to control of Central Government	Subject to control of Central Government
Method	By notification in Official Gazette	By notification in Official Gazette
Scope of matters	"For carrying out the purposes of this Act" + illustrative list	Same wide language + illustrative list
Laid before Parliament	Yes — subject to legislative scrutiny	Yes
Retrospective effect	Restricted where it prejudices taxpayers	Restricted (same principle)
Rules currently in force	Income-tax Rules, 2026 (w.e.f. 1 Apr 2026)	Income-tax Rules, 1962 (now replaced)

Related sections

Section 295 (Act, 1961) — Power to make rules (predecessor) Income-tax Rules, 2026 — the rules notified under Section 533 Section 2 — Definitions, including "prescribed" meaning by rules CBDT Notification No. 22/2026 — notifying the 2026 Rules Section 1 — Short title, extent and commencement of the 2025 Act

Frequently asked questions

What is Section 533 of the Income-tax Act, 2025 about?

It gives the Central Board of Direct Taxes (CBDT) the power to make rules for carrying out the purposes of the Act, subject to the control of the Central Government. It is the legal basis for the Income-tax Rules, 2026.

Is Section 533 the same as old Section 295?

Yes. Section 533 of the 2025 Act is the direct successor to Section 295 of the 1961 Act, carrying forward the same rule-making framework with only structural renumbering.

Can a rule made under Section 533 override the Act itself?

No. A rule is subordinate legislation and cannot contradict or go beyond the parent Act. If a rule conflicts with a section, the section prevails and the rule can be struck down as ultra vires.

Where do the Income-tax Rules, 2026 come from?

They were notified by the CBDT under Section 533 via Notification No. 22/2026 dated 20 March 2026 and took effect from 1 April 2026, replacing the Income-tax Rules, 1962.

Does the word "prescribed" in the Act refer to these rules?

Yes. Wherever the Act says something must be done in the "prescribed" manner or form, it means prescribed by rules made under Section 533 — that is, the Income-tax Rules, 2026.

Are rules under Section 533 checked by Parliament?

Yes. Rules must be laid before both Houses of Parliament, which can modify or annul them, though in practice this is mostly an informational scrutiny.

Can the CBDT change tax forms or limits without a new law?

For matters left to the rules, yes — the CBDT can amend a Rule by Gazette notification, which is far quicker than amending the Act. But it cannot change anything the Act itself fixes.

CA Rajat Agrawal

Chartered Accountant, EaseValue · Reviewed 05 Jul 2026

This explainer is prepared and reviewed by EaseValue's tax team, based on the text of the Income-tax Act, 2025 (as amended by the Finance Act, 2026).

Disclaimer: This page explains the law in general terms for education and is not professional advice. The Income-tax Act, 2025 takes effect from 1 April 2026; provisions, thresholds and interpretations may change. Please confirm your specific position with our team before acting.

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