Rules 266 to 268 of the Draft Income-tax Rules, 2026 outline procedural provisions and investigative powers for disciplinary inquiries against authorised income-tax practitioners conducted under Section 515 of the Income-tax Act.
Rule 266 provides that when the prescribed authority conducts an inquiry itself without appointing a separate Inquiry Officer, the same procedural rules applicable to inquiries by an Inquiry Officer will apply, as far as practicable.
Rule 267 addresses situations where an Inquiry Officer must be replaced during an ongoing inquiry. In such cases, the prescribed authority may appoint another officer not below the rank of Assistant Commissioner of Income-tax, and the proceedings will continue from the stage where the previous officer left them, ensuring continuity and avoiding duplication of proceedings.
Rule 268 strengthens the inquiry framework by granting the prescribed authority and the Inquiry Officer powers equivalent to those of a civil court under the Code of Civil Procedure 1908 while conducting proceedings. These powers include ordering discovery and inspection of documents, enforcing the attendance of individuals including bank officers and examining them under oath, compelling the production of books of account and other relevant records, and issuing commissions for evidence. Collectively, these provisions provide procedural clarity, ensure continuity in disciplinary inquiries, and equip authorities with adequate legal powers to effectively investigate and adjudicate cases of professional misconduct by income-tax practitioners.
Extract of Rule No. 266, 267,268 of Draft Income-tax Rules, 2026
Rule 266
Procedure if no Inquiry Officer appointed.
The procedure prescribed in the aforesaid rules shall also apply, to the extent possible, to the prescribed authority when it conducts the inquiry without appointing an Inquiry Officer.
Rule 267
Change of Inquiry Officer.
If it becomes necessary to change the Inquiry Officer during an inquiry, the prescribed authority may appoint another Inquiry Officer who is at least the rank of an Assistant Commissioner of Income-tax. The proceedings shall continue with the new Inquiry Officer from the point where they were left by his predecessor.
Rule 268
Powers of prescribed authority and Inquiry Officer.
For the purposes of any proceedings under rules 261 to 267, the prescribed authority and the Inquiry Officer shall have the same powers as are vested in a Court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the following matters: –
a. discovery and inspection;
b. enforcing the attendance of any person including any officer of a banking company and examining him on oath;
c. compelling the production of books of account and other documents; and
d. issuing commissions.
