Union Budget 2026-27 - Finance Bill, 2026

Section 296 of the Act, provides for time limit for completing a block assessment. An assessment or reassessment order under Section 294 (procedure for block assessment) must be completed within 12 months from the end of the quarter in which the last search authorization was executed or requisition was made.

2. Further, it is considered that use of last date of authorisations as reference for deciding date of limitation lead to different date of limitations in case of group being searched. As search and seizure proceedings are more often conducted in a group of cases which require coordinated investigation and assessments.

3. Accordingly, it is proposed to amend the section 296 of the Act so as to take the date of initiation of search as the reference point to decide the date of limitation for block assessment where any search has been initiated or requisition is made in the case of any person and consequently, the period of twelve months is proposed to be to eighteen months to complete such assessment in case of such person.

4. This amendment will take effect from the 1st day of April, 2026, for search or requisition is initiated or made as the case maybe, on or after 1st day of April, 2026.

[Clause 65]

 

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Full Text:

Union Budget 2026-27 - Finance Bill, 2026

Union Budget 2026-27 proposes using initiation of search as the trigger for block assessment and extending the period to eighteen months. The amendment replaces the last search authorization date with the initiation of search (or requisition) as the reference for computing the block-assessment limitation period and increases that period from twelve months to eighteen months, effective for searches or requisitions initiated on or after 1 April 2026.