Indian income-tax law | Updated 28 October 2026
Section 293C of the Income-tax Act, 1961: Power to Withdraw Approval
Section 293C empowered the Central Government, the Central Board of Direct Taxes (CBDT) or an authorised income-tax authority to withdraw an approval granted under the Income-tax Act, 1961, even where the particular approval provision did not expressly provide for withdrawal. Section 529 of the Income-tax Act, 2025 now addresses the corresponding power.
What is the power to withdraw approval?
An approval under income-tax law may permit an assessee to claim a statutory benefit or to operate under a particular tax-related authorisation. The power to grant an approval is distinct from the power to withdraw it. These provisions make clear that the competent approval-granting authority can withdraw approval even where the underlying provision is silent on withdrawal, subject to procedural safeguards.
Section 293C: Statutory provision under the 1961 Act
Where the Central Government or the Board or an income-tax authority, who has been conferred upon the power under any provision of this Act to grant any approval to any assessee, the Central Government or the Board or such authority may, notwithstanding that a provision to withdraw such approval has not been specifically provided for in such provision, withdraw such approval at any time:
Provided that the Central Government or Board or income-tax authority shall, after giving a reasonable opportunity of showing cause against the proposed withdrawal to the assessee concerned, at any time, withdraw the approval after recording the reasons for doing so.
Legislative history: Inserted by the Finance (No. 2) Act, 2009 (Act 33 of 2009), section 79, with effect from 1 October 2009.
Section 529: Corresponding provision under the Income-tax Act, 2025
Where the Central Government or the Board or an income-tax authority, has the power to grant any approval under any provision of this Act to any assessee, the Central Government or the Board or such income-tax authority may, withdraw such approval at any time after recording the reasons therefor, even if such provision does not specifically allow for its withdrawal, after giving such assessee a reasonable opportunity of being heard.
The 2025 provision presents the same central rule in simplified language: withdrawal may occur even without a separate express withdrawal clause, but reasons must be recorded and the assessee must have a reasonable opportunity to be heard.
Key legal terms explained
- Central Government: The Union Government acting through the authority competent under the applicable income-tax provision.
- Board: The Central Board of Direct Taxes (CBDT), the statutory board administering direct-tax law.
- Income-tax authority: An authority empowered under the relevant enactment to grant the particular approval.
- Assessee: A person falling within the statutory meaning of assessee under the applicable income-tax enactment.
- Approval: A permission or authorisation granted under a provision of the Act; its nature and conditions depend on that provision.
- Reasonable opportunity of being heard: A meaningful chance to respond to the grounds proposed for withdrawal before an adverse decision is made.
- Recording reasons: Documenting the grounds for the decision so that the exercise of statutory power can be understood and, where appropriate, challenged.
Conditions and safeguards before withdrawal
- Competent authority: The decision must be made by the Central Government, CBDT or income-tax authority possessing the relevant statutory power.
- Opportunity to respond: The assessee must receive a reasonable opportunity to contest the proposed withdrawal.
- Reasons on record: The authority must record the reasons supporting its decision.
- Compliance with specific provisions: Any additional applicable procedural requirements under the relevant approval regime must also be considered.
The general power does not mean that every approval may be withdrawn arbitrarily. The facts, statutory conditions, procedural fairness and relevant judicial decisions remain important.
Section 293C and Section 529: Quick comparison
| Subject | 1961 Act: Section 293C | 2025 Act: Section 529 |
|---|---|---|
| Heading | Power to withdraw approval | Power to withdraw approval |
| Competent authority | Central Government, Board or empowered income-tax authority | Central Government, Board or empowered income-tax authority |
| Express withdrawal clause necessary? | No | No |
| Procedural protection | Reasonable opportunity to show cause | Reasonable opportunity of being heard |
| Reasons | Must be recorded | Must be recorded |
Practical considerations for taxpayers
An assessee receiving a proposed withdrawal notice should identify the approval concerned, the authority issuing the notice, the stated grounds, the conditions attached to the approval and the time allowed for responding. A factual response supported by documents can address compliance, any alleged breach and the consequences of withdrawal. The appropriate remedy against a final order depends on the particular statutory regime and the circumstances of the case.
Frequently asked questions
Can an approval be withdrawn if the section granting it says nothing about withdrawal?
Yes. Both Section 293C and corresponding Section 529 expressly contemplate withdrawal despite the absence of a specific withdrawal provision, subject to the applicable safeguards.
Is a hearing required before withdrawal?
Yes. The assessee must be given a reasonable opportunity of being heard or showing cause, as the applicable provision requires.
Must the authority give reasons?
Yes. Recording reasons is a statutory requirement under both provisions.
Does Section 529 automatically invalidate approvals granted before April 2026?
No such automatic invalidation follows from Section 529 alone. The status of an existing approval depends on its governing provisions and the applicable repeal, savings and transition rules.
Official statutory sources
- Income Tax Department: Income-tax Act, 1961, as amended (see Section 293C).
- Income Tax Department: Income-tax Act, 2025 (see Section 529 and applicable repeal and savings provisions).
- Income Tax Department: Section correspondence navigator (Section 293C to Section 529).
This article provides general legal information. Verify the current statutory text, applicable notifications and the facts of a particular approval before taking action.