Chapter XIV - Tax Administration
Section 259
Section 259: power to call for information by prescribed income-tax authority
Section 259 gives a prescribed income-tax authority a targeted power to verify information it already possesses, by issuing a notice asking any person to furnish further information relevant to an inquiry or proceeding, and to process that information under the faceless collection scheme.
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Need advice on Section 259?
This article is for general information. Refer to the Income-tax Act, 2025 as amended by the Finance Act, 2026 and the Taxation and Other Laws (Amendment) Act, 2026 for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(1) For the purposes of verification of information in the possession of the prescribed income-tax authority, such authority may issue a notice requiring any person to furnish any information as may be useful for, or relevant to, any inquiry or proceeding under this Act in such form and manner and within such time, as specified in such notice.
(2) The prescribed income-tax authority may process and utilise such information and document received by him as per the scheme notified under section 260.
(3) For the purposes of this section, the term “proceeding” shall have the meaning assigned to it in section 253.
Introduction
This notice power begins with information already held by the prescribed authority. The notice can require any person to supply useful or relevant information and must specify its form, manner and response time.
Key takeaways
Verification is the purpose
The prescribed authority may issue a notice to verify information already in its possession.
The notice controls the response
It specifies the required form, manner and time for furnishing information useful or relevant to an enquiry or proceeding.
Processing follows the Section 260 scheme
Information and documents received may be processed and used under the notified faceless collection scheme.
Notice to verify existing information
For verifying information already in its possession, the prescribed income-tax authority may issue a notice requiring any person to furnish information useful or relevant to an inquiry or proceeding under the Act, in the form, manner and within the time specified in the notice.
Processing under the faceless scheme
The prescribed income-tax authority may process and utilise the information and documents it receives, as per the scheme notified under Section 260 (faceless collection of information).
Meaning of 'proceeding'
For this section, the term "proceeding" has the meaning assigned to it in Section 253 (powers of survey).
Step-by-step flow for applying Section 259
- 1
Is the authority the prescribed income-tax authority?
Section 259 applies only to the authority prescribed by the rules; the Act does not name it.
- No: Section 259 does not apply; look at Section 252 or other powers.
- Yes: Go to the next step.
- 2
Is the purpose to verify information already in its possession?
Section 259(1) is tied to verification of information the authority holds.
- 3
Issue or receive the notice
The notice can require any person to furnish information useful for, or relevant to, any inquiry or proceeding under the Act, in the form and manner and within the time stated in the notice.
- 4
What counts as a "proceeding"?
Under Section 259(3), the meaning in Section 253 applies: any proceeding for any year pending on the date the power is used, completed on or before that date, or commenced after it.
- 5
Processing of the reply
The authority may process and use the information and documents under the scheme notified under Section 260 (Section 259(2)).
Practical checklist
Do
- Read the notice for the requested information, prescribed form, response method and due time.
- Keep a copy of the submitted information and acknowledgment.
Avoid
- Ignore a notice simply because no assessment has been completed.
Illustrative example
Worked example: a mismatch in interest income
Hypothetical facts (illustration only, not a real taxpayer): The prescribed income-tax authority holds information that Ms. Bose earned interest of ₹1,80,000 on deposits in a tax year. Her return for that year, which has already been processed, shows interest of ₹1,20,000. The authority issues a notice to her asking for details of her deposits. All amounts are assumed.
Purpose
The notice is to verify information already held by the authority, so Section 259(1) applies.
Mismatch
₹1,80,000 − ₹1,20,000 = ₹60,000 is the amount to be explained.
Proceeding
Even though her return has been processed, the Section 253 meaning of "proceeding" includes completed proceedings and later ones, so the information is relevant (Section 259(3)).
Reply
She must reply in the form, manner and time stated in the notice, for example with deposit statements showing what part of the interest belongs to that year.
Outcome
- The notice is valid; Ms. Bose should reconcile the ₹60,000 difference with records.
- Section 259 is a verification power; any change to her income follows under the assessment provisions.
Frequently asked questions
How is Section 259 different from Section 252's power to call for information?
Section 259 is specifically for verifying information the prescribed income-tax authority already possesses, and processing it under the faceless collection scheme notified under Section 260. Section 252 is a broader power exercised by the Assessing Officer, Joint Commissioner, or Commissioner (Appeals) for enquiries and proceedings generally.
What does 'proceeding' mean for Section 259?
It carries the same meaning assigned to that term in Section 253 (the survey powers section).
Need help applying this provision to your situation?
Get help responding to an income-tax noticeLast updated 9 October 2026