The section is a single sentence with two conditions. Where income arises to any person by virtue of a transfer, and there has been no transfer of the assets from which that income arises, the income is chargeable as the income of the transferor and included in his total income. Clause (a) makes it immaterial whether the transfer is revocable or irrevocable, and immaterial whether it was effected before or after the commencement of the Act.
Why it is there
It defeats the arrangement of assigning away an income stream while keeping the asset that produces it. Because the section covers irrevocable transfers and transfers pre-dating the Act, the transferor cannot escape by making the arrangement permanent or by having made it long ago.
Who it applies to
A transferor who has transferred income without transferring the asset from which it arises
Any person to whom income arises by virtue of such a transfer
What this means in practice
If you have assigned the right to receive income — rent, interest, royalties — while continuing to hold the underlying asset, the income remains yours for tax and goes into your total income however the money is actually received. Making the assignment irrevocable does not change that. The only way out of the section is a genuine transfer of the assets themselves, since the section applies only "where there is no transfer of assets from which such income arises".
An example
Illustrative only, and invented for this page. The figures are chosen to show the rule biting, not taken from any real matter.
An individual owns a shop yielding Rs. 6,00,000 of rent a year and executes an irrevocable deed assigning that rent to his brother while keeping the shop itself. Because there is no transfer of the asset from which the income arises, the whole Rs. 6,00,000 stays chargeable as the transferor's income and goes into his total income, however the money actually reaches his brother; the irrevocability meant to make the arrangement safe is expressly made irrelevant by clause (a). Nor does the age of the arrangement help, the section applying to a transfer effected before or after the commencement of the Act — the only escape is a genuine transfer of the shop.
Where you meet this section
In the transferor's return and in the assessment that includes the assigned income in his total income; the section names no form and no authority. The person who actually receives the money does not meet the section at all — the charge is placed on the transferor.
The words themselves
shall be chargeable to income-tax as the income of the transferor and shall be included in his total income
Section 96, Income-tax Act, 2025.
What people get wrong
Assuming that an irrevocable assignment escapes clubbing. Clause (a) applies the section "whether revocable or not".
Assuming that an arrangement predating the 2025 Act is grandfathered. The section applies to a transfer "effected before or after the commencement of this Act".
Reading it as taxing the recipient. The income is charged as the income of the transferor and included in the transferor's total income, whoever it accrues to.
What this replaced
The correspondence is the Income Tax Department’s own, from its comparison utility for the 1961 and 2025 Acts. A renumbering is the easy half; whether the words changed is the half that decides cases.
60 - Transfer of income where there is no transfer of assets
A circular binds the department, not you and not a court. Every one below was written under the 1961 Act; it reaches this section because the department’s own concordance carries the provision it names to this one.
Circular No. 13/2019 — Government of India Ministry of Finance Department of Revenue Central Board of Direct Taxes CIRCULAR No. 13/2019 North Block, New 2019-06-24
A notification is made under a power the Act gives and, within that power, is law. These too were made under the 1961 Act and are placed here by the department’s concordance.
Notification No. 28 — Income-tax (Sixth Amendment) Rules, 2009 - Insertion of rule 37BA and 37-I 2009-03-16
Read this before you rely on it. Every decision below was decided under the Income-tax Act, 1961. It appears here because it is tagged to a 1961 provision that the department’s own mapping carries to section 96. That is an inference we have drawn, not a holding on the new section: where the words changed in the move, the reasoning may not survive. Treat this as the place to start looking, not as authority on the 2025 Act.
Radhasoami Satsang v CITSupreme CourtHelps taxpayertagged s.60 The department accepted your position for years and has now reversed it. Can it?
What this page does not tell you. It does not reproduce the section. Everything above was written from the section’s own text as the Income Tax Department publishes it — the text is here, and nothing here is advice on your facts. Where a figure matters, read the sub-section it comes from.