Section 164 of the 1961 Act → Section 307 of the 2025 Act
Charge of tax where shares of beneficiaries are unknown.
Quick answer
Section 164 of the Income-tax Act, 1961 corresponds to Section 307 of the Income-tax Act, 2025. Relationship: Revised. Correspondence verified against both Acts.
How it works
Where beneficiaries’ shares are not fixed or known, the trustee can be taxed at the maximum marginal rate.
Example
A Category III AIF whose investors’ shares are indeterminate pays tax at the maximum marginal rate.
What you need to do
Category III fund: make investors’ shares determinate in the documents where possible.
What changed?
- Read the complete new provision, including its conditions, exceptions and related provisions, when applying it.
The two texts, side by side
1961 · Section 164164. (1) Subject to the provisions of sub-sections (2) and (3), where any income in respect of which the persons mentioned in clauses (iii) and (iv) of sub-section (1) of section 160 are liable as representative assessees or any part thereof is not specifically receivable on behalf or for the benefit of any one person or where the individual shares of the persons on whose behalf or for whose benefit such income or such part thereof is receivable are indeterminate or unknown (such income, such part of the income and such persons being hereafter in this section referred to as "relevant income", "part of relevant income" and …
2025 · Section 307307. (1) The income or any part thereof, in respect of the person mentioned in sections 303(1)(c) and (d) shall be chargeable to tax at the maximum marginal rate, if— (a) such income or such part thereof is not specifically receivable on behalf or for the benefit of any one person; or (b) the individual shares of the persons on whose behalf or for whose benefit such income or such part thereof is receivable are indeterminate or unknown. (2) The income or any part thereof as referred to in sub-section (1), shall be chargeable to tax at the rate applicable to an association of persons as if it were its total income, if,— (a) none of the …
Excerpts end with … where the provision continues. Last reviewed 24 October 2026.
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CS Prashant Kumar
Company Secretary & Compliance Officer
Global Horizons Capital Advisors (IFSC) Private Limited — an IFSCA-licensed investment banker
Published in The Chartered Accountant (Jun 2025, Jan 2025, Mar 2024) and Chartered Secretary (Aug 2023)
Prashant Kumar is a seasoned Company Secretary and corporate governance strategist with more than 13 years of experience advising large corporates, promoter-led groups and global businesses on compliance, regulatory risk and board governance. In GIFT IFSC, the IFSCA regime is his day job rather than a research topic.