The Income Tax Department has issued a demand notice of Rs 4.62 crore to the Equestrian Federation of India (EFI) for the assessment year 2024-25 under Section 156 of the Income-Tax Act, 1961, marking the first such notice to the federation, official documents show.

The notice, dated February 9, 2026, says a sum of Rs 4,62,18,102 has been determined as payable by EFI for the assessment year 2024-25 and must be deposited within 30 days of service to an authorised bank, according to the document in PTI’s possession.

Correspondence from EFI’s Chartered Accountant to the federation’s office-bearers indicates that certain compliance-related documents, including a Non-Utilisation/Accumulation Certificate, were required to be signed and furnished for submission to the Income Tax Department.

A final accumulation certificate was also prepared in 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 led to the current 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 documentation filed by an organisation to set aside income for future use without being taxed in the current year.

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

As a National Sports Federation affiliated with international equestrian bodies, EFI makes overseas remittances towards affiliation fees, participation expenses and other international commitments. However, the mandatory CBDT approval for such foreign transfers for the relevant financial year was not secured.

The notice further warns that failure to pay the amount 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. It also cautions that non-payment could trigger penalty proceedings under Section 221, which may extend up to the amount of tax in arrears, after providing an opportunity of being heard.

The department has added that recovery proceedings may be initiated under relevant provisions of the Act if the dues remain unpaid. It also said that if the assessee intends to challenge the assessment, an appeal may be filed before the National Faceless Appeal Centre within 30 days of receipt of the notice, in line with prescribed procedures.

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