**Executive Summary**
The Central Board of Direct Taxes (CBDT) has notified the Income-tax (Second Amendment) Rules, 2026, to amend the definition of a "specified fund" under Rule 157. These rules were published by the Ministry of Finance and come into force on July 21, 2026. The primary purpose is to clarify the registration and regulatory requirements for investment funds to qualify under this category.
**Key Points / Main Content**
**Statutory Authority and Commencement**
* The rules are issued under the powers conferred by section 533, read with section 262, of the Income-tax Act, 2025.
* The amendment is officially titled the Income-tax (Second Amendment) Rules, 2026.
* The provisions take effect immediately upon their publication in the Official Gazette on July 21, 2026.
**Revised Definition of "Specified Fund"**
The amendment replaces clause (c) of sub-rule (5) in Rule 157, defining a "specified fund" as an entity that meets the following criteria:
* **Legal Structure:** The fund must be established or incorporated in India as a trust, company, limited liability partnership (LLP), or body corporate.
* **Registration Status:** It must possess a certificate of registration as a Category I or Category II Alternative Investment Fund (AIF).
* **Regulatory Oversight:** The fund must be regulated under one of the following:
* The Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012.
* The International Financial Services Centres Authority (Fund Management) Regulations, 2022 (for funds located in an International Financial Services Centre).
* **Alternative Qualification:** Any fund specifically referred to in Schedule VI [Note 1(g)] of the Income-tax Act is also included in the definition.
**Impact Analysis**
**Category I and Category II Alternative Investment Funds (AIFs)**
**Impact**
These entities are directly affected by the refined criteria for being recognized as a "specified fund." The rules link their tax status to specific legal forms (trust, company, LLP, or body corporate) and specific regulatory frameworks.
**Action Required**
Funds must ensure they hold a valid certificate of registration for Category I or II and confirm their governing structure aligns with the permitted legal forms.
**Entities in International Financial Services Centres (IFSCs)**
**Impact**
The document explicitly includes funds located in an IFSC, provided they are regulated under the International Financial Services Centres Authority (Fund Management) Regulations, 2022.
**Action Required**
IFSC-based funds must ensure compliance with the 2022 IFSCA regulations to maintain or achieve "specified fund" status under the Income-tax Rules.
**Tax Authorities and Practitioners**
**Impact**
This amendment provides a clear, updated legal framework for identifying "specified funds" during tax assessments and filings.
**Action Required**
Practitioners must apply the revised definition of "specified fund" under Rule 157(5)(c) for all proceedings and filings effective from July 21, 2026.
Key Entities Referenced
Income-tax (Second Amendment) Rules, 2026: The specific policy notification that amends Rule 157 to redefine 'specified fund' for tax purposes.
Income-tax Act, 2025: The primary legislation under which the Central Board of Direct Taxes exercises power to make these rule amendments.
Central Board of Direct Taxes (CBDT): The primary regulatory authority under the Ministry of Finance responsible for issuing and administering these tax rules.
Income-tax Rules, 2026: The underlying regulatory framework that is being modified by this amendment notification.
Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012: Referenced regulations used to define the eligibility of funds categorized as 'specified funds' under the amendment.
रजिस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99
सी.जी.-डी.एल.-अ.-21072026-274685
CG-DxLx-xEG-I2D1H0x7x2x0 26-274685
xxxGIDExxx
असाधारण
EXTRAORDINARY
भाग II—खण् ड 3—उप-खण्ड (i)
PART II—Section 3—Sub-section (i)
प्राजधकार स ेप्रकाजित
PUBLISHED BY AUTHORITY
स.ं 587] नई दिल्ली, मगं लिार, िुलाई 21, 2026/आषाढ 30, 1948
No. 587] NEW DELHI, TUESDAY, JULY 21, 2026/ASHADHA 30, 1948
जित्त मत्रं ालय
(रािस्ट्ि जिभाग)
(केन्द्रीय प्रत्यक्ष कर बोड)ड
अजधसचू ना
नई दिल्ली, 21 िुलाई, 2026
(आय-कर)
सा.का.जन. 646(अ).— केन्द्रीय प्रत्यक्ष कर बोडड, आय-कर अजधजनयम, 2025 (2025 का 30) की धारा 262 के
साथ पठित धारा 533 द्वारा प्रित्त िजियों का प्रयोग करते हुए, आय-कर जनयम, 2026 का और संिोधन करने के जलए
जनम्नजलजखत जनयम बनाता ह,ै अथाडत ् :-
1. (1) इन जनयमों का संजक्षप्त नाम आय-कर (िसू रा संिोधन) जनयम, 2026 ह ै।
(2) य ेरािपत्र में उनके प्रकािन की तारीख से प्रिृत्त होंग े।
2. आयकर जनयम, 2026 के जनयम 157 के उपजनयम (5) म,ें खंड (ग) के स्ट्थान पर जनम्नजलजखत खंड रखा िाएगा, अथाडत्:–
‘(ग) “जिजनर्िडष्ट जनजध” स—े
5541 GI/2026 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]
(i) भारत म ें न्द्यास या कंपनी या सीजमत िाजयत्ि भागीिारी या जनगजमत जनकाय के रूप में स्ट्थाजपत या
जनगजमत कोई जनजध अजभप्रेत ह,ै जिसे प्रिग ड1 या प्रिग ड2 िैकजल्पक जनिेि जनजध के रूप में पंिीकरण
का प्रमाणपत्र अनुित्त दकया गया ह ैऔर जिसे जनम्नजलजखत के अधीन जिजनयजमत दकया िाता है—
(अ) भारतीय प्रजतभूजत और जिजनमय बोडड अजधजनयम, 1992 (1992 का 15) के अधीन बनाए
गए भारतीय प्रजतभूजत और जिजनमय बोड ड(जनजधयों का िैकजल्पक जनिेि) जिजनयम, 2012;
या
(आ) अंतराष्ट्रड ीय जित्तीय सेिा केंर प्राजधकरण अजधजनयम, 2019 (2019 का 50) के अधीन
बनाए गए अंतराष्ट्रड ीय जित्तीय सेिा केंर प्राजधकरण (जनजध प्रबधं न) जिजनयम, 2022 और
िो दकसी अंतराडष्ट्रीय जित्तीय सेिा केंर में अिजस्ट्थत ह ै; या
(ii) कोई जनजध, जिसे अजधजनयम की अनुसूची 6 [ठिप्पण 1 (छ)] में जनर्िष्टड दकया गया ह ै;’।
[स.ं 94/2026/फा. स.ं 370142/24/2026-िीपीएल]
रोजहत ससंह, अिर सजचि
ठिप्पण : आय-कर जनयम, 2026, भारत के रािपत्र, असाधारण, भाग II, खडं 3, उपखंड (i) में अजधसूचना संख्या
का.आ. 198(अ), तारीख 20 माच,ड 2026 द्वारा प्रकाजित दकए गए थ े और अंजतम बार अजधसूचना संख्या
सा.का.जन. 241(अ) तारीख 31 माच,ड 2026 द्वारा संिोजधत दकए गए थ े।
MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 21st July, 2026
(INCOME-TAX)
G.S.R. 646(E).— In exercise of the powers conferred by section 533 read with section 262 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 (Second 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, in rule 157, in sub-rule (5), for clause (c), the following clause shall be substituted,
namely: —
‘(c) “specified fund” means —
(i) any fund established or incorporated in India in the form of a trust or a company or a limited liability
partnership or a body corporate which has been granted a certificate of registration as a Category I
or Category II Alternative Investment Fund and is regulated under —
(A) the Securities and Exchange Board of India (Alternative Investment Funds) Regulations,
2012 made under the Securities and Exchange Board of India Act, 1992 (15 of 1992); or[भाग II—खण् ड 3(i)] भारत का रािपत्र : असाधारण 3
(B) the International Financial Services Centres Authority (Fund Management) Regulations,
2022 made under the International Financial Services Centres Authority Act, 2019
(50 of 2019) and which is located in any International Financial Services Centre; or
(ii) any fund which has been referred to in Schedule VI [Note 1(g)] to the Act;’.
[No. 94/2026/F. No. 370142/24/2026-TPL]
ROHIT SINGH, Uunder Secy.
Note: The Income-tax Rules, 2026 were published in the Gazette of India, Extraordinary, Part II, section 3, sub-section
(i), vide notification number G.S.R. 198(E), dated the 20th March, 2026 and were last amended vide notification
number G.S.R. 241(E), dated the 31st March, 2026.
Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.