Assessment of total income as a result of search [ Section 158BA ] - Income Tax - Ready Reckoner - Income Tax

Assessment of total income as a result of search [ Section 158BA ] [ W.e.f. 01.09.2024 Substituted vide Finance (No. 2) Act, 2024 ] Assessment or Reassessment for the Block period Notwithstanding anything in any other provisions of this Act, In case of any person if a search is conducted under section 132 or if books of account, documents, or assets are requisitioned under section 132A on or after September 1, 2024, the Assessing Officer shall assess or reassess the total income for the relevant block period in accordance with the provisions of this Chapter. [ Section 158BA(1) ] Block period means the period comprising previous years relevant to six assessment years preceding the previous year in which the search was initiated u/s 132 or any requisition was made u/s 132A and also includes the period starting from the 1st day of April of the previous year in which search was initiated or requisition was made and ending on the date of the execution of the last of the authorisations for such search or such requisition; [ Section 158B(a) ] End of Pending of Assessment or Reassessments When Search or Requisition Begins The assessment or reassessment or recomputation under the provisions of this Act (other than this Chapter), if any, pertaining to any assessment year falling in the block period, pending on the date of initiation of the search u/s 132, or making of requisition u/s 132A, as the case may be, shall abate and shall be deemed to have abated on the date of initiation of search or making of requisition. In other words Any pending assessment, reassessment, or recomputation under this Act (excluding this Chapter) for an assessment year within the block period will be considered null and void as of the date the search u/s 132 or the requisition u/s 132A is initiated. [ Section 158BA(2) ] Where during the course of any pending proceeding for the assessment or reassessment or recomputation under the provisions of this Act (other than this Chapter), a reference to Transfer Pricing Officer u/s 92CA(1) has been made, or an order u/s 92CA(3) has been passed , such assessment or reassessment or recomputation, along with such reference made or order passed, as the case may be, shall also abate and shall be deemed to have abated on the date of initiation of search or making of requisition. [ Section 158BA(3) ] Where any assessment under the provisions of this Chapter is pending in the case of an assessee in whose case a subsequent search is initiated, or a requisition is made, such assessment shall be duly completed, and thereafter, the assessment in respect of such subsequent search or requisition shall be made under the provisions of this Chapter. In a case where the period of completing the assessment in respect of subsequent search is less than three months such period shall be extended to three months from the end of the month in which the assessment in respect of the earlier search was completed. [ Section 158(4) ] Revival of Abated Assessments After Annulment of Section 158BC(1)(c) Orders If any proceeding initiated under this Chapter or any order of assessment or reassessment made u/s 158BC(1)(c) has been annulled in appeal or any other legal proceeding, then, notwithstanding anything in this Chapter or section 153 , the assessment or reassessment relating to any assessment year which has abated u/s 158BA(2) or (3), shall revive with effect from the date of receipt of the order of such annulment by the Principal Commissioner or Commissioner. such revival shall cease to have effect, if such order of annulment is set aside. [ Section 158BA(5) ] Separate Assessment Procedures for Income Relevant to Final Search or Requisition The total income (other than undisclosed income) of the assessment year relevant to the previous year in which the last of the authorisations for a search is executed or a requisition is made, shall be assessed separately in accordance with the other provisions of this Act. [ Section 158BA(6) ] Tax Rate for Income Relating to the Block Period The total income relating to the block period shall be charged to tax, at the rate specified in section 113 (i.e. 60% plus surcharge and cess) , as income of the block period irrespective of the previous year or years to which such income relates. Important Note For the purpose of this chapter VI-B (i.e. Special procuder for assessment of search cases) the meaning of The last of the authorisations the last of the authorisations shall be deemed to have been executed, (a) in the case of search, on the conclusion of search as recorded in the last panchnama drawn in relation to any person in whose case the warrant of authorisation has been issued; (b) in the case of requisition under section 132A, on the actual receipt of the books of account or other documents or assets by the Authorised Officer. [ Define under Explanation to section 158B ]