Section 190 - Determination of tax where total income includes income on which no tax is payable
This is a tax-calculation adjustment, not a deduction from income. First compute total tax and the average rate; then isolate the statutorily no-tax component.
Reviewed by CA Nikhil Gupta · Updated 9 October 2026
Current law and effective date
Section 190 is controlled against the consolidated Income-tax Act, 2025 as amended by the Finance Act, 2026. The Act and Income-tax Rules, 2026 operate from 1 April 2026; earlier years and saved proceedings require the repeal-and-savings framework rather than automatic migration.
Primary statute: Income Tax Department consolidated Act | Rules: Notified Income-tax Rules, 2026
2-minute decode
This is a tax-calculation adjustment, not a deduction from income. First compute total tax and the average rate; then isolate the statutorily no-tax component.
Who should use this section
Assessees whose total income includes a component on which the Act itself makes no income-tax payable and who therefore need the average-rate deduction mechanism.
Old-law bridge
section 110
The old-law bridge is navigational, not automatic precedent transfer. Match the 1961 Act wording, saved proceedings, current 2025 Act text and effective date before importing an older interpretation.
Finance Act 2026 / current-law note
No section-specific Finance Act, 2026 textual substitution is separately flagged for section 190; the consolidated post-Finance-Act-2026 text remains the controlling version and must be used instead of pre-1 April 2026 extracts.
Professional alert
Identify income that is included in total income but carries a no-tax rule. Do not confuse exempt income excluded from total income with section 190 income. Reconcile average-rate computation to the return utility.
Connected Income-tax Rules, 2026 and Forms
| Rule | Current control | Form |
|---|---|---|
| No provision-specific Rule/Form is directly prescribed for this section in the mapping used here. Apply the statute directly and check the current Rules where another provision cross-refers to them. | ||
Worked application
Total income is ₹12 lakh, including ₹1 lakh on which the Act provides no tax. The relief is the average tax rate multiplied by ₹1 lakh, subject to the precise charging provisions.
Evidence / compliance checklist
- Identify income that is included in total income but carries a no-tax rule (section 190 evidence control 1).
- Do not confuse exempt income excluded from total income with section 190 income (section 190 evidence control 2).
- Reconcile average-rate computation to the return utility (section 190 evidence control 3).
Common mistake
A common section 190 error is to apply the old-law label or headline rate without rebuilding the current statutory conditions. For “Determination of tax where total income includes income on which no tax is payable”, the safer control is to test the exact taxpayer/transaction facts, the operative tax year, every linked Rule/Form and the Finance Act 2026 consolidated wording. Identify income that is included in total income but carries a no-tax rule. Do not confuse exempt income excluded from total income with section 190 income. Reconcile average-rate computation to the return utility.
Recommended approach
For section 190, start with the legal trigger in “Determination of tax where total income includes income on which no tax is payable”, document the evidence for that trigger, then run the computation or procedural step against the current text. As a cross-check, verify this provision-specific checkpoint: This is a tax-calculation adjustment, not a deduction from income. First compute total tax and the average rate; then isolate the statutorily no-tax component.
Thresholds, periods and timing checkpoints
- Section 190 contains no standalone numeric checkpoint extracted for the register; apply its operative conditions from the current statutory text.
Related provisions and interaction map
Section 190 operates inside Chapter XIII special-rate computation; reconcile its particular tax bucket with the relevant capital-gains, unexplained-income or corporate-regime rules, plus surcharge, cess, return and loss-set-off provisions.
Provision summary - verify verbatim text in the official Act
Text-status note: This guide does not reproduce the complete verbatim provision for section 190. Use the linked official consolidated Act before quoting sub-section language or preparing a filing, opinion or litigation document.
Primary-source trail
Statute: Income-tax Act, 2025 as amended by Finance Act, 2026
Rules: Income-tax Rules, 2026
Law navigation: Income Tax Department 2025 Act / Rules hub
Quoting note: Use the official consolidated Act for verbatim legislative language.
FAQs
Does an old Income-tax Act, 1961 case automatically decide section 190?
No. The old-law bridge helps research, but transferability depends on materially matching language, transition rules and any Finance Act 2026 change.
Which text should be quoted in advice or litigation?
Quote the consolidated official statute for the relevant tax year. If this page presents a provision summary rather than complete statutory text, use the official consolidated Act for verbatim legislative language.