{"act":{"id":"finance-act-2026","short_title":"The Finance Act, 2026","long_title":"An Act to give effect to the financial proposals of the Central Government for the financial year 2026-2027.","act_number":"4","act_year":2026,"enact_date":null,"enforcement_date":null,"ministry":"Ministry of Finance","department":"Department of Revenue","jurisdiction":"CENTRAL","unit":"section","section_count":167,"in_force":true,"spent":false,"spent_note":null,"duplicate_of":null,"text_source":"published","scan_url":null,"url":"https://indiacode.ecourtsindia.com/finance-act-2026/"},"unit":"section","section":{"number":"59","heading":"Amendment of section 206","text":"Amendment of section 206. 59. In section 206 of the Income-tax Act,— (a) | in sub-section (1),— (i) | in clause (b), in sub-clause (ii), for the figures and symbol \"15%\", the figures and symbol \"14%\" shall be substituted; (ii) | in clause (i), for sub-clause (ii), the following sub-clause shall be substituted, namely:— \"(ii) | the assessee has not utilised the credit of tax paid under section 115JAA of the Income-tax Act, 1961 (43 of 1961), in any subsequent tax year ending on or before the 31st March, 2026,\"; (iii) | in clause (l), in sub-clause (iii), the brackets, words, letters and figures \"(Table: Sl. Nos. 1, 3, 4 and 5)\" shall be omitted; (iv) | clauses (m), (n), (o) and (p) shall be omitted; (v) | in clause (q), in the opening portion, for the word \"section\", the word \"sub-section\" shall be substituted; (vi) | clause (r) shall be omitted; (vii) | in clause (5), for the words \"which this section\", the words \"which this sub-section\" shall be substituted; (b) | for sub-section (3), the following sub-sections shall be substituted, namely:— \"(3) (a) The provisions of this sub-section shall be applicable only to an assessee, being a domestic company, that has exercised the option under section 200(5) or section 201(2) for a tax year, beginning on or after the 1st April, 2026. (b) Where any amount of credit, in respect of tax paid, was allowed to be carried forward to the assessee under the provisions of section 115JAA of the Income-tax Act, 1961 (43 of 1961), as on 31st March, 2026,— (i) | such credit brought forward shall be allowed to be set off in any tax year to the extent of 25% of the tax payable on the total income computed as per the other provisions of this Act for that tax year; (ii) | the remaining credit shall be carried forward to the subsequent tax year; and (iii) | such carry forward or set off of tax credit shall not be allowed beyond the fifteenth tax year immediately succeeding the tax year in which the tax credit first became allowable under section 115JAA of the Income-tax Act, 1961 (43 of 1961). (c) Where, as a result of any order passed under this Act, tax payable under this Act is decreased or increased, as the case may be, tax credit allowed to be set off under clause (b) shall also be decreased or increased, accordingly. (d) In case of conversion of a private company or unlisted public company into a limited liability partnership under the Limited Liability Partnership Act, 2008 (6 of 2009), the provisions of clauses (a) and (b) shall not apply to the successor limited liability partnership. (4) (a) The provisions of this sub-section shall be applicable only to an assessee, being a foreign company. (b) Where, any amount of credit in respect of tax paid was allowed to be carried forward to the assessee under the provisions of section 115JAA of the Income-tax Act, 1961 (43 of 1961), as on 31st March, 2026,— (i) | such tax credit shall be carried forward and set off in a tax year, when tax payable on the total income computed as per the provisions of this Act exceeds the minimum alternate tax computed as per provisions of sub-section (1); (ii) | such set off in respect of brought forward tax credit shall be allowed for any tax year to the extent of the difference between the tax liability on the total income computed as per the other provisions of this Act and the minimum alternate tax for that tax year; and (iii) | such carry forward or set off of tax credit shall not be allowed beyond the fifteenth tax year immediately succeeding the tax year in which the tax credit first became allowable under section 115JAA of the Income-tax Act, 1961 (43 of 1961). (c) Where, as a result of any order passed under this Act, tax payable under this Act is decreased or increased, as the case may be, tax credit allowed to be set off under clause (b) shall also be decreased or increased, accordingly. (d) In case of conversion of a private company or unlisted public company into a limited liability partnership under the Limited Liability Partnership Act, 2008, the provisions of clauses (a) and (b) shall not apply to the successor limited liability partnership. (5) Save as otherwise provided in this section, all other provisions of this Act shall apply to every assessee mentioned in this section.\".","html":"

Amendment of section 206.

59. In section 206 of the Income-tax Act,—

(a)in sub-section (1),—
(i)in clause (b), in sub-clause (ii), for the figures and symbol \"15%\", the figures and symbol \"14%\" shall be substituted;
(ii)in clause (i), for sub-clause (ii), the following sub-clause shall be substituted, namely:—
\"(ii)the assessee has not utilised the credit of tax paid under section 115JAA of the Income-tax Act, 1961 (43 of 1961), in any subsequent tax year ending on or before the 31st March, 2026,\";
(iii)in clause (l), in sub-clause (iii), the brackets, words, letters and figures \"(Table: Sl. Nos. 1, 3, 4 and 5)\" shall be omitted;
(iv)clauses (m), (n), (o) and (p) shall be omitted;
(v)in clause (q), in the opening portion, for the word \"section\", the word \"sub-section\" shall be substituted;
(vi)clause (r) shall be omitted;
(vii)in clause (5), for the words \"which this section\", the words \"which this sub-section\" shall be substituted;
(b)for sub-section (3), the following sub-sections shall be substituted, namely:—
\"(3) (a) The provisions of this sub-section shall be applicable only to an assessee, being a domestic company, that has exercised the option under section 200(5) or section 201(2) for a tax year, beginning on or after the 1st April, 2026.
(b) Where any amount of credit, in respect of tax paid, was allowed to be carried forward to the assessee under the provisions of section 115JAA of the Income-tax Act, 1961 (43 of 1961), as on 31st March, 2026,—
(i)such credit brought forward shall be allowed to be set off in any tax year to the extent of 25% of the tax payable on the total income computed as per the other provisions of this Act for that tax year;
(ii)the remaining credit shall be carried forward to the subsequent tax year; and
(iii)such carry forward or set off of tax credit shall not be allowed beyond the fifteenth tax year immediately succeeding the tax year in which the tax credit first became allowable under section 115JAA of the Income-tax Act, 1961 (43 of 1961).
(c) Where, as a result of any order passed under this Act, tax payable under this Act is decreased or increased, as the case may be, tax credit allowed to be set off under clause (b) shall also be decreased or increased, accordingly.
(d) In case of conversion of a private company or unlisted public company into a limited liability partnership under the Limited Liability Partnership Act, 2008 (6 of 2009), the provisions of clauses (a) and (b) shall not apply to the successor limited liability partnership.

(4) (a) The provisions of this sub-section shall be applicable only to an assessee, being a foreign company.

(b) Where, any amount of credit in respect of tax paid was allowed to be carried forward to the assessee under the provisions of section 115JAA of the Income-tax Act, 1961 (43 of 1961), as on 31st March, 2026,—

(i)such tax credit shall be carried forward and set off in a tax year, when tax payable on the total income computed as per the provisions of this Act exceeds the minimum alternate tax computed as per provisions of sub-section (1);
(ii)such set off in respect of brought forward tax credit shall be allowed for any tax year to the extent of the difference between the tax liability on the total income computed as per the other provisions of this Act and the minimum alternate tax for that tax year; and
(iii)such carry forward or set off of tax credit shall not be allowed beyond the fifteenth tax year immediately succeeding the tax year in which the tax credit first became allowable under section 115JAA of the Income-tax Act, 1961 (43 of 1961).

(c) Where, as a result of any order passed under this Act, tax payable under this Act is decreased or increased, as the case may be, tax credit allowed to be set off under clause (b) shall also be decreased or increased, accordingly.

(d) In case of conversion of a private company or unlisted public company into a limited liability partnership under the Limited Liability Partnership Act, 2008, the provisions of clauses (a) and (b) shall not apply to the successor limited liability partnership.

(5) Save as otherwise provided in this section, all other provisions of this Act shall apply to every assessee mentioned in this section.\".

","words":755,"text_source":"published"},"classification":[],"instruments":[],"judgments":[],"corresponds_to":[],"url":"https://indiacode.ecourtsindia.com/finance-act-2026/section/59/","note":null,"source_note":"Harvested from the Income Tax Department's own portal at incometaxindia.gov.in, which publishes the Finance Acts section by section. India Code carries none of them: its Central community holds the Acts that stand as general law, and a Finance Act is an amending and rate-fixing instrument.","judgments_note":"Judgment holdings are the ratio decidendi as extracted from the order by eCourts India, reproduced unaltered. Reported judgments only.","licence":"Published with commentary and other original matter under s.52(1)(q)(ii), Copyright Act 1957."}