Procedure for block assessment [ Section 158BC ] - Income Tax - Ready Reckoner - Income Tax

Procedure for block assessment [ Section 158BC ] Amended provision w.e.f. 01.09.2024 vide Finance Act, 2025 Where any search has been initiated under section 132 or books of account, other documents or assets are requisitioned under section 132A , in the case of any person, then, Requirement of Furnishing a Return (a) the Assessing Officer shall, in respect of search initiated, or books of account or other documents or any assets requisitioned, on or after the 01.09.2024, issue a notice to such person, requiring him to furnish within such period, not exceeding a period of 60 days , as may be specified in the notice, a return in the form and verified in the manner, as may be prescribed, setting forth his undisclosed income, for the block period: (i) such return shall be considered as if it was a return furnished under the provisions of section 139 and notice under section 143(2) shall thereafter be issued: (ii) any return of income, required to be furnished by an assessee under this section and furnished beyond the period allowed in the notice shall not be deemed to be a return under section 139 : (iii) no notice under section 148 is required to be issued for the purpose of proceeding under this Chapter: (iv) a person who has furnished a return under this clause shall not be entitled to furnish a revised return; Extension of time limit of the Filling ITR under the Block Assessment [ Fifth proviso of section 158BC(1)(a) ] The time allowed for furnishing a return under this clause may be extended by a further period of thirty days, where (i) in respect of a previous year immediately preceding the previous year in which the search is initiated or requisition is made, the due date for furnishing the return has not expired prior to the date of initiation of such search or requisition; (ii) the assessee was liable for audit under section 44AB for such previous year; (iii) the accounts (maintained in normal course) of such previous year have not been audited on the date of issuance of such notice; and (iv) the assessee requests in writing for extension of time for furnishing such return to get such accounts audited; Manner of Determination of Total undisclosed Income (b) the Assessing Officer shall proceed to determine the total undisclosed income of the block period in the manner laid down in section 158BB and the provisions of section 142 , section 143(2) (3) , section 144 , section 145 , section 145A and section 145B shall, so far as may be, apply; Issue of Order (c) the Assessing Officer, on determination of the total undisclosed income of the block period in accordance with this Chapter, shall pass an order of assessment or reassessment and determine the tax payable by him on the basis of such assessment or reassessment: The provisions of section 144C (i.e. Reference to Dispute Resolution Panel ) shall not apply in respect of such order: Procedures for Dealing with Seized and Requisitioned Assets (d) the assets seized under section 132 or requisitioned under section 132A shall be dealt with in accordance with the provisions of section 132B. [ Section 158BC(1) ] Non applicability of the provisions [ Section 158BC(2) ] The provisions of section 143(1) shall not apply to the return furnished under this section. Required prior approval for Issuance of Notice Under Section 158BC(1)(a) [ Section 158BC(3) ] The Assessing Officer, before issuance of notice under section 158BC(1)(a), shall take prior approval of the Additional Commissioner or the Additional Director or the Joint Commissioner or the Joint Director, as the case may be. Original provision Inserted w.e.f. 01.09.2024 Inserted vide Finance Act, 2024 Where any search has been initiated under section 132 or books of account, other documents or assets are requisitioned under section 132A , in the case of any person, then, Requirement of Furnishing a Return - (a) the Assessing Officer shall, in respect of search initiated, or books of account or other documents or any assets requisitioned, on or after the 1st day of September, 2024, issue a notice to such person, requiring him to furnish within such period, not exceeding a period of sixty days, as may be specified in the notice, a return in the form and verified in the manner, as may be prescribed, setting forth his total income, including the undisclosed income, for the block period. [ Section 158BC(1)(a) ] Such return shall be considered as if it was a return furnished under the provisions of section 139 and notice under section 143(2) shall thereafter be issued. [ First Proviso Section 158BC(1)(a) ] Any return of income, required to be furnished by an assessee under this section and furnished beyond the period allowed in the notice shall not be deemed to be a return under section 139 . [ Second Proviso Section 158BC(1)(a) ] No notice under section 148 is required to be issued for the purpose of proceeding under this Chapter. [ Third proviso Section 158BC(1)(a) ] A person who has furnished a return under this clause shall not be entitled to furnish a revised return. [ Fourth Proviso Section 158BC(1)(a) ] The provisions section 143(1) shall not apply to the return furnished under section 158BC. [ Section 158BC(2) ] Manner of determination of total Income - (b) the Assessing Officer shall proceed to determine the total income including the undisclosed income of the block period in the manner laid down in section 158BB and the provisions of section 142 , section 143(2) (3) , section 144 , section 145 , section 145A and section 145B shall, so far as may be, apply; Determination of Tax Liability - (c) the Assessing Officer, on determination of the total income of the block period in accordance with this Chapter, shall pass an order of assessment or reassessment and determine the tax payable by him on the basis of such assessment or reassessment: The provisions of section 144C (i.e. Reference to Dispute Resolution Panel ) shall not apply in respect of such order under section 158BC(1)(c). [ First proviso of section 158BC(1)(c) ] where the order of assessment or reassessment is made in pursuance of section 158BD, the block period for such assessment or reassessment shall be the same as that determined in respect of the person in whose case search was made under section 132 , or whose books of account or other documents or any assets were requisitioned under section 132A , and proceedings under section 158BD were initiated due to such search or requisition, as the case may be; [ Second proviso of section 158BC(1)(c) ] Procedures for Dealing with Seized and Requisitioned Assets - (d) the assets seized under section 132 or requisitioned under section 132A shall be dealt with in accordance with the provisions of section 132B . Required prior approval for Issuance of Notice Under Section 158BC(1)(a) [ Section 158BC(3) ] The Assessing Officer, before issuance of notice under section 158BC(1)(a), shall take prior approval of the Additional Commissioner or the Additional Director or the Joint Commissioner or the Joint Director, as the case may be.