Chapter XXIII - Miscellaneous
Section 517
Section 517: receipt to be given
Section 517 requires a receipt to be given for any money paid or recovered under the Income-tax Act, 2025.
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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
A receipt shall be given for any money paid or recovered under this Act.
Introduction
The statutory wording covers both money paid and money recovered under the Act. It does not specify a particular format for the receipt.
Key takeaways
Payment
A receipt must be given for money paid under the Act.
Recovery
The same requirement applies to money recovered under the Act.
Receipt requirement
A receipt shall be given for any money paid or recovered under the Income-tax Act, 2025.
Scope and business relevance
The receipt requirement covers two different situations: a person pays money under the Act, or money is recovered under the Act. A recovery is therefore not outside the rule merely because it was not a voluntary payment.
For a business, the receipt is part of the trail connecting the outflow to the tax proceeding. Keep the bank evidence and the receipt together so that the amount credited can be reconciled with the relevant demand or payment reference.
Limits and related provisions
Section 517 does not itself prescribe a receipt format, a fixed issue deadline or a separate charge for obtaining a receipt. Do not infer any of those details from its short wording.
A receipt evidences money received. It does not, by itself, determine the correctness of the assessment, extinguish a remaining balance or decide an appeal. Those questions require the relevant assessment and account records.
Step-by-step review
1. Identify whether the amount was paid or recovered under the Act and locate the transaction or recovery reference.
2. Obtain and retain the receipt, then compare the amount with the bank debit or recovery record.
3. Match the receipt to the relevant person, proceeding and tax year where those details are recorded; flag any mismatch for reconciliation.
4. Keep a record of any request for a missing or corrected receipt and the response received.
Hypothetical practical example
Hypothetical illustration: a company pays ₹40,000 against a demand and a further ₹10,000 is recovered. The receipt requirement covers both amounts. The accounts team should reconcile the evidence for each amount; a receipt for the voluntary payment alone does not explain the separate recovery. These figures illustrate record matching, not a tax calculation.
Documents and record checklist
Payment reference or recovery communication and corresponding bank evidence.
Receipt for each payment or recovery and its recorded amount.
Demand or assessment reference and reconciliation of any remaining balance.
Official Act source
Step-by-step flow for applying Section 517
- 1
Is the money paid or recovered under this Act?
- No: Section 517 does not apply.
- Yes: Go to the next step.
- 2
Is it a voluntary payment or a recovery?
Section 517 covers both: money paid and money recovered.
- 3
A receipt must be given
The duty is stated without exceptions. Section 517 does not set out the form of the receipt or who issues it.
- 4
Keep and reconcile the receipt
Match the receipt against your own payment or bank records. A receipt shows the money was paid or recovered; it does not decide whether the underlying demand was correct.
Practical checklist
Do
- Request and retain a receipt for money paid or recovered under the Act.
- Match the receipt to the payment or recovery amount and its date.
- Payment reference or recovery communication and corresponding bank evidence.
- Receipt for each payment or recovery and its recorded amount.
- Demand or assessment reference and reconciliation of any remaining balance.
Avoid
- Do not rely only on an oral confirmation of payment or recovery.
Illustrative example
Worked example: a payment and a recovery
Hypothetical facts (illustration only, not a real taxpayer): Mr. Khan pays ₹45,000 of tax. Later, ₹12,000 is recovered under the Act from his bank account towards another demand. All amounts are assumed.
Payment
The ₹45,000 is money paid under the Act, so a receipt must be given.
Recovery
The ₹12,000 is money recovered under the Act, so a receipt must be given for it too.
Total
Receipts together cover ₹45,000 + ₹12,000 = ₹57,000.
Check
Mr. Khan matches both receipts with his bank statement.
Outcome
- Mr. Khan is entitled to receipts for both amounts.
- Whether the ₹12,000 demand was correct is a separate question.
Glossary
- Receipt
- Evidence acknowledging money paid or recovered under the Act.
- Reconciliation
- Comparing the receipt, financial record and relevant tax account to identify differences.
Frequently asked questions
Does Section 517 cover recovered money as well as payments?
Yes. It expressly covers money paid or recovered under the Act.
Does this section prescribe the form of the receipt?
No receipt format is specified in Section 517.
Does a receipt prove that the assessment itself is correct?
No. It records payment or recovery; the assessment and any challenge to it must be considered separately.
What should I check if the receipt amount differs from the bank record?
Compare the transaction and recovery references and seek reconciliation of the difference. Section 517 itself does not supply a correction form or time limit.
Need help applying this provision to your situation?
Talk to our tax team about this sectionLast updated 10 October 2026