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CBDT NotificationGeneral for ecommerce sellers

Revised Form 161: application for waiver of penalty under Section 440(2)

Reviewed by CA Apurav GargSummary reviewed

Document
Notification No. 134/2026 [G.S.R. 871(E)]
Issued
8 Oct 2026
Effective
8 Oct 2026
Issued by
Central Board of Direct Taxes (CBDT)
Official PDF(opens in a new tab)

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What it means for ecommerce sellers

Notification 134/2026 amends the Income-tax Rules, 2026. Rule 231 now covers waiver as well as imposition, and Form 161 is replaced with the application for waiver of penalty under Section 440(2) of the Income-tax Act, 2025. To use it, a taxpayer pays the tax and interest on assessed income plus additional income-tax (100% or 120% of the tax on under-reported income) by the demand due date, and undertakes not to appeal. It is a general procedural change, relevant only after an assessment order with under-reported income.

Who it affects

  • Taxpayers with an assessment or reassessment order showing under-reported income

Before and after

  • Rule 231

    Before
    Referred to imposition only
    After
    Covers imposition or waiver

  • Form 161

    Before
    Earlier form
    After
    Substituted: application for waiver of penalty under Section 440(2)

What to do

  1. If you receive an assessment order with under-reported income, note the demand due date: the waiver needs the full amount paid by then.

Provisions referred to: Section 440 Income-tax Act, 2025; Section 439(11) and (12); Rule 231 Income-tax Rules, 2026; Form 161

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Official text

As issued by Central Board of Direct Taxes (CBDT). Where the text starts with “Extract”, only the parts that concern ecommerce sellers are reproduced; the official PDF (opens in a new tab) is the authoritative version.

Type a word, number or section to highlight it below.

4 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)] MINISTRY OF FINANCE (Department of Revenue) (CENTRAL BOARD OF DIRECT TAXES) NOTIFICATION New Delhi, the 8th October, 2026 INCOME-TAX G.S.R. 871(E).— In exercise of the powers conferred by section 533 read with section 440 of the Income-tax Act, 2025 (30 of 2025), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 2026, namely: –– 1. (1) These rules may be called the Income-tax (Sixth Amendment) Rules, 2026. (2) They shall come into force on the date of their publication in the Official Gazette. 2. In the Income-tax Rules, 2026, – (a) in rule 231, after the word “imposition”, the words “or waiver” shall be inserted; (b) for FORM NO. 161, the following Form shall be substituted, namely: – “FORM NO. 161 [See rule 231] Application for seeking waiver of penalty under section 440(2) of the Income-tax Act, 2025 Part A: Personal Information 1. Name (Refer Note 1) 2. Permanent Account Number 3. Address (Refer Note 2) 4. Contact details (i) Mobile Number Country Code Number (ii) Email ID Part B: Details of assessment or reassessment order and payments 5. Tax Year 6. Section under which the order is passed 7. Document Identification Number (DIN) of the order 8. Date of the order dd/mm/yyyy 9. Date of service of the order dd/mm/yyyy 10. Due date for payment as per notice of demand dd/mm/yyyy 11. Income assessed 12. Under-reported income A. In consequence of misreporting as per (i) Section 439(11)(a) to (f) (ii) Section 439(11)(g) B. Not in consequence of misreporting 13. Tax and interest payable on assessed income (Refer computation sheet along with notice of demand) 14. Tax payable on under-reported income (Refer section 439(12) of the Act) (i) On amount referred to in Sl.No 12(A)(i) (ii) On amount referred to in Sl.No 12(A)(ii) 15. Additional income-tax payable (in lieu of penalty) (i) 100% of 14(i) (ii) 120% of 14(ii) (iii) Total additional income-tax [(i)+(ii)] 16. Total amount payable for waiver of penalty [13+ 15(iii)] (Refer section 440(1) of the Act) (Refer Note 3) 17. Details of amounts paid (A) (i) BSR Code (ii) Date of Deposit dd/mm/yyyy (iii) Serial Number of Challan (iv) Amount (B) (Repeat, if required) Verification I, __________________, PAN_____________, do hereby declare that what is stated above is true to the best of my information and belief. I further declare that no appeal has been filed in respect of the order mentioned in Part-B above. I also undertake that no appeal shall be filed in respect of the said order before the expiry of the period specified in section 440(5). I further declare that I am making this application in my capacity as _________________ and I am also competent to file this application and verify it. Verified today the ______________ day of ___________20____. Place…….. Signature Date………… Name Designation (if applicable) Notes: 1. In case of individual, the first, middle and last name shall be provided in full without any abbreviations. In any other case also, the name shall be provided in full. 2. The address shall contain (i) Country/Region, (ii) Flat/Door/Building, (iii) Road/Street/Block/Sector, (iv) PIN/ZIP Code, (v) Post Office, (vi) Area/locality, (vii) District, (viii) State. The address may also contain DIGIPIN. 3. Total amount payable for waiver of penalty within due date for payment as per notice of demand as per Sl.No 10. 4. Some of the Information in the form would be pre-filled to the extent possible. 5. All the amounts are to be provided in ₹, unless otherwise specified.”. [Notification No. 134/2026/F. No. 370142/33/2026-TPL] PRERNA, Under Secy. Note: The Income-tax Rules, 2026 were published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (i) vide number G.S.R. 198(E), dated the 20th March, 2026 and was last amended vide notification number G.S.R. 830(E), dated the 22nd September, 2026.

Questions sellers ask

What is Form 161 under the Income-tax Rules 2026?

As substituted by Notification 134/2026, it is the application for seeking waiver of penalty under section 440(2) of the Income-tax Act, 2025.

What must be paid to apply for the waiver?

Tax and interest payable on the assessed income plus additional income-tax in lieu of penalty: 100% of the tax on under-reported income not from misreporting under 439(11)(a) to (f), and 120% for 439(11)(g), by the due date in the notice of demand.

Can I appeal after applying?

The verification in Form 161 declares that no appeal has been filed and undertakes that none will be filed before the period in section 440(5) expires.

When did the change take effect?

On publication in the Official Gazette, 8 October 2026.

Want help working out what this means for your business?

We handle GST and TDS compliance, returns and notice replies for D2C and marketplace sellers, and can walk you through how a change applies to your books.

Contact usWhatsApp us

General information only, not professional advice. The summary is ecomca’s reading of the document; the official PDF is the authoritative version, and later amendments may change it. Check the official source before you act.