I-T dept issues ₹4.62 cr demand notice to Equestrian Federation of India

The Income Tax Department has, for the first time, issued a demand notice of Rs 4.62 crore to the Equestrian Federation of India for the assessment year 2024-25 under Section 156 of the Income-Tax Act, 1961, according to official documents.

The notice, dated February 9, 2026, states that a sum of Rs 4,62,18,102 has been determined as payable by the federation for the assessment year 2024-25.

As per the notice, which is in possession of PTI, the amount is to be paid within 30 days of service to an authorised bank.

According to correspondence from EFI's Chartered Accountant to the federation's office-bearers, certain compliance documents -- including a Non-Utilisation/Accumulation Certificate -- were required to be signed and furnished to enable submission before the Income Tax Department.

A final accumulation certificate has also been prepared in connection with the matter but EFI Secretary General Col Jaiveer Singh told PTI that delays by the EFI Executive Committee in completing documentation and securing necessary approvals contributed to the present situation.

"This accumulation certificate duly signed in ink by all EC members was required to be submitted to the IT department. Non-submission of this document has resulted in issuance of the letter. Recourse available to the Federation as per relevant provisions of IT rules will be undertaken," Col Jaiveer Singh said.

An "accumulation certificate" generally refers to the documentation filed by organisation to set aside income for future use without it being taxed in the current year.

EFI sources also said approval from the Central Board of Direct Taxes under provisions linked to Section 11 of the Act, required in cases involving certain foreign transfers, was also not obtained by the Col. Jagat Singh-led federation.

EFI, as a National Sports Federation affiliated to international equestrian bodies, makes overseas remittances towards affiliation fees, participation expenses and related international commitments.

However, the requisite CBDT approval for such foreign transfers for the relevant financial year was not obtained.

The notice further states that failure to pay within the stipulated period would attract simple interest at one per cent for every month or part thereof under Section 220(2) of the Act.

The department has also warned that non-payment could lead to penalty proceedings under Section 221, which may be up to the amount of tax in arrears, after providing an opportunity of being heard.

Recovery proceedings may also be initiated under relevant provisions of the Act if the dues remain unpaid.

The notice adds that if the assessee intends to appeal against the assessment, it may file an appeal before the National Faceless Appeal Centre within 30 days of receipt of the notice, in accordance with prescribed procedures.

EFI is affiliated to the Ministry of Youth Affairs and Sports, the Indian Olympic Association, and international equestrian bodies.