Chapter IV — General Provisions

Section 48: Exemption of Bank from income-tax and super-tax

Reviewed by CA Nikhil Gupta · Last reviewed 18 September 2026

Section 48 exempts RBI from liability to income-tax and super-tax on its income, profits or gains.

Operative provisionOfficial sources mappedProvision-specific decode

Finin2min - Section 48 in 2 minutes

Legal effectSection 48 exempts RBI from liability to income-tax and super-tax on its income, profits or gains.

Operative ruleThe exemption belongs to RBI as the statutory central bank and does not pass through to banks, NBFCs, employees, contractors or counterparties merely because they transact with RBI.

Connected lawTax treatment of other persons remains governed by the Income-tax Act and the character of their income.

File evidenceFor a contract with RBI, do not assume the counterparty's receipt is tax-exempt because RBI itself enjoys Section 48 exemption.

Statutory structure and clause / subsection decode

This map separates the operative limbs of this provision so thresholds, powers, conditions and exceptions are not collapsed into a single summary.

Scope

Section 48 exempts RBI from liability to income-tax and super-tax on its income, profits or gains.

Operative limb

The exemption belongs to RBI as the statutory central bank and does not pass through to banks, NBFCs, employees, contractors or counterparties merely because they transact with RBI.

Legal boundary

Tax treatment of other persons remains governed by the Income-tax Act and the character of their income.

Worked practical example

Facts. Interest earned by a commercial bank on an RBI-related transaction remains subject to that bank's tax analysis; Section 48 does not exempt the bank's income.

Compliance points and common mistakes

Do not decide the issue from the heading alone. Map the facts to the operative words of Section 48 and to each relevant subsection, clause, proviso or explanation shown above.
Keep the statutory question separate from the operational overlay. Tax treatment of other persons remains governed by the Income-tax Act and the character of their income.
Do not convert an exception, exemption or discretionary RBI/Government power into an automatic entitlement. Record the authority, conditions and effective date.
Where the provision is historical, omitted or repealed, state that status prominently and do not present it as a current compliance obligation.

Connected provisions and instruments

Section 48 has no universal instrument dependency in this package. Add an RBI circular or direction only when its subject, entity and effective date cover the issue being analysed.

Questions and answers

What is the purpose of Section 48?

Exemption of Bank from income-tax and super-tax: Section 48 exempts RBI from liability to income-tax and super-tax on its income, profits or gains.

Which statutory limb should be checked first?

Scope - Section 48 exempts RBI from liability to income-tax and super-tax on its income, profits or gains.

What is the next legal boundary?

Operative limb - The exemption belongs to RBI as the statutory central bank and does not pass through to banks, NBFCs, employees, contractors or counterparties merely because they transact with RBI.

What record should support the conclusion?

Section 48 file evidence: For a contract with RBI, do not assume the counterparty's receipt is tax-exempt because RBI itself enjoys Section 48 exemption.

Primary sources

Source control for Section 48: use the official consolidated RBI Act for the statutory text and footnotes, then separately reconcile any post-Finance Act 2022 amendment, commencement notification or RBI instrument relevant to the event date.