Section 296 — Time-limit for completion of block assessment

63[(1) Irrespective of the provisions of section 286, the order under section 294
shall be passed within eighteen months from the end of the quarter in which the
search was initiated or requisition was made.]
(2) Where search was initiated or requisition was made, and during the course of
assessment or reassessment of the total undisclosed income of the relevant block
period, any reference under section 166(1) is made, the period available for completion
of such assessment or reassessment proceeding shall be extended by twelve months.
(3) In computing the period of limitation under sub-section (1), the period (not
exceeding one hundred and eighty days) commencing from the date on which a
search is initiated or a requisition is made and ending on the date on which assets
[as provided in section 261( b)] and material seized or requisitioned [as provided
in section 261(i)] are handed over to the Assessing Officer having jurisdiction over
the assessee shall be excluded.
(4) If after exclusion of the period referred to in sub-section (3), the remaining period
of limitation for completion of assessment or reassessment, expires before the end
of a month, such period shall be extended to end of such month.
(5) The period of limitation for completion of assessment or reassessment for the
block period in the case of the other person referred to in section 295 shall be
twelve months from the end of the quarter in which the notice under section 294
in pursuance of section 295, was issued to such other person.
(6) The period available for completion of assessment or reassessment proceeding in
respect of the block period in a case referred to in sub-section (5) shall be extended
by twelve months, where a reference under section 166(1) is made in such case.
(7) In computing the period of limitation under this section, the following period
shall be excluded,—
( a) the period commencing on the date on which stay on assessment pro -
ceeding was granted by an order or injunction of any court and ending
on the date on which certified copy of the order vacating the stay was
received by jurisdictional Principal Commissioner or Commissioner; or
63. Substituted by the Finance Act, 2026, w.e.f. 1-4-2026. Prior to its substitution, sub-section
(1) read as under :
‘(1)( a) Irrespective of the provisions of section 286, the order under section 294 shall be passed
within twelve months from the end of the quarter in which the last of the authorisations for
search was executed, or requisition was made.
( b) Where in pursuance to section 294(1)(a)(v), the time allowed under the said section for
furnishing return is extended by a further period of thirty days, the provisions of sub-sections
(1) and (5) shall have effect, as if for the words “twelve months”, the words “thirteen months”
had been substituted.’
( b) the period commencing from the date on which a first of the reference
for exchange of information (made by an authority competent under an
agreement referred to in section 159) is made and ending with the date
on which such information requested is last received by the jurisdictional
Principal Commissioner or Commissioner or one year, whichever is less;
or
( c) the time taken in reopening the whole or any part of the proceeding
or giving an opportunity to the assessee to be re-heard under section
244(2); or
( d) the period commencing from the date on which the Assessing Officer
directs the assessee to get his accounts audited or inventory valued under
section 268(5), and—
( i) ending with the last date on which the assessee is required to furnish
a report of such audit or inventory valuation under that sub-section;
or
( ii) where such direction is challenged before a court, ending with the
date on which the certified copy of the order setting aside such
direction is received by the jurisdictional Principal Commissioner
or Commissioner; or
( e) the period commencing from the date on which the Assessing Officer
makes a reference to the Valuation Officer under section 269(1) and
ending with the date on which the report of the Valuation Officer is
received by the Assessing Officer; or
( f) the period commencing from the date on which the Assessing Officer
intimates the Central Government or the prescribed authority, the con-
travention of the provisions of Schedule III (Table: Sl. No. 23, 24 or 25)
as referred to in section 270(11)( i) and ending with the date on which
the copy of the order withdrawing the approval or rescinding the noti -
fication, under those clauses is received by the Assessing Officer; or
( g) the period commencing from the date on which the Assessing Officer
makes a reference to the Principal Commissioner or Commissioner as
per section 270(13) and ending with the date on which the copy of the
order under section 351(2)( ii)(A) or ( B), is received by the Assessing
Officer; or
( h) the period commencing from the date on which a reference for declara-
tion of an arrangement to be an impermissible avoidance arrangement is
received by the jurisdictional Principal Commissioner or Commissioner
under section 274(1) and ending on the date on which a direction under
sub-section (3) or (6) or an order under sub-section (5) of the said section
is received by the Assessing Officer; or
( i) the period commencing from the date on which an application is made
before the Board for Advance Rulings under section 383(1) and ending
with the date on which the order rejecting the application is received
by the jurisdictional Principal Commissioner or Commissioner under
section 384(5); or
( j) the period commencing from the date on which an application is made
before the Board for Advance Rulings under section 383(1) and ending
with the date on which the advance ruling pronounced by it is received
by the jurisdictional Principal Commissioner or Commissioner under
section 384(8).
(8) Where immediately after the exclusion of the period referred to in sub-section
(3) or (7), the remaining period of limitation referred to in sub-section (1) or (5)
available to the Assessing Officer for completion of assessment under section 294 is
less than sixty days, such remaining period shall be extended to sixty days and the
aforesaid period of limitation shall be deemed to be extended accordingly.
(9) Where after extension of the period referred to in sub-section (8), the period of
limitation for making an order of assessment or reassessment, expires before the
end of a month, such period shall be extended to the end of such month.