Sections 292-293 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 292 opens Part B of Chapter XVI, the special procedure for search cases. Where a search is initiated or a requisition is made on or after the commencement of the Act, the Assessing Officer assesses the "total undisclosed income of the block period" under this Part, and pending proceedings for years in the block period abate. Section 293 says how that income is computed and what is left out. This article reads both as per the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026.
After a search or requisition, the Assessing Officer assesses the total undisclosed income of the block period under Part B, and pending assessments for years in the block period abate. That income is charged at the rate specified in section 192, whatever tax years it relates to. Section 293 adds the undisclosed income declared in the return to that determined by the Assessing Officer, and excludes income already assessed or declared and income recorded in the books in the normal course.
Section 292: assessment as a result of search
Sub-section (1): the trigger
Irrespective of any other provision of the Act, where on or after the commencement of the Act, in the case of any person, a search is initiated or a requisition is made, the Assessing Officer proceeds to assess or reassess the total undisclosed income of the block period as per the provisions of this Part. The "block period" is defined in section 301; see our article on sections 298 to 301. Search and requisition themselves arise under sections 247 and 248; our note on section 247 covers the search power. If your premises have been searched, our legal dispute resolution team can help you plan the response.
Sub-sections (2) and (3): abatement
| Sub-section | What abates |
|---|---|
| (2)(a) | Assessment, reassessment or recomputation proceedings under the Act (other than this Part) for any tax year in the block period, pending on the date of initiation of search or the date of making the requisition, abate on that date |
| (2)(b) | Any such proceeding for a tax year in the block period (other than the tax year in which the last of the authorisations for a search is executed or the requisition is made), for which a notice is issued between the date of initiation of search or requisition and the date of the order under section 294(1)(c), abates on the date of issue of that notice |
| (3) | If a reference has been made under section 166(1) or an order passed under section 166(6), the proceedings in sub-section (2) abate together with that reference or order on the date in sub-section (2) |
Sub-section (4): a search after a pending block assessment
Where an assessment under this Part is required for an assessee in whose case a search or requisition happens subsequently: (a) the pending assessment is duly completed; (b) assessment for the subsequent search or requisition is made thereafter under this Part; and (c) if the period available for (b) is less than three months, it is extended to three months from the end of the month in which the assessment in (a) was completed.
Sub-section (5): revival if annulled
Irrespective of anything in this Part or section 286, if any proceeding under this Part, or any order under section 294(1)(c), is annulled in an appeal or other legal proceeding, then (a) the assessment, reassessment, recomputation, reference or order that abated under sub-section (2) or (3) revives with effect from the date of receipt of the annulment order by the Principal Commissioner or Commissioner; and (b) the revival ceases to have effect if the annulment order is set aside. Revived cases carry the time limit in the Table in section 286, row 6; see our article on section 286(1) and (2).
Sub-sections (6) and (7): the year of search and the rate
- (6): the income (other than undisclosed income) of the tax year in which the last of the authorisations for a search is executed, or a requisition is made, is assessed separately as per the other provisions of the Act.
- (7): the total undisclosed income of the block period, as referred to in section 293(7), is charged to tax at the rate specified in section 192 as income of the block period, irrespective of the tax year or years to which the income relates. The rate is printed in section 192, not here, and this article states none.
Section 293: computation of total undisclosed income
Sub-section (1): what it is made of
The total undisclosed income of the block period is the aggregate of (a) undisclosed income declared in the return furnished under section 294; and (b) undisclosed income determined by the Assessing Officer under sub-section (4).
Sub-section (2): what is not included
| Clause | Excluded income |
|---|---|
| (a) | Total income determined or assessed under section 270(1) or (10), 271, 279 or 294(1)(c) of this Act, or section 143, 144, 147, 153A, 153C, 158BC or 245D(4) of the Income-tax Act, 1961 (43 of 1961), before the date of initiation of search or requisition, for any tax year in the block period |
| (b) | Total income declared in a return filed under section 263 of this Act (or section 139 of the 1961 Act), or in response to a notice under section 268(1) of this Act (or section 142(1) of the 1961 Act), before that date, for a tax year in the block period, and not covered under clause (a) |
| (c)(i) | Income computed by the assessee for a tax year that has ended and for which the due date for the return had not expired before the search or requisition, on the basis of entries recorded in books and documents maintained in the normal course before that date |
| (c)(ii) | Income computed for the period from 1 April of the tax year of search or requisition to the day before it, on the same basis |
| (c)(iii) | Income computed for the period from the date of initiation of search or requisition to the date of execution of the last authorisation, on the same basis (entries made on or before the date of execution of the last authorisation) |
| (d) | Total income referred to in section 207(8), section 216 or section 393(1) (Table: serial number 8(iii)) of this Act, or section 115A(5), 115G or 194P(1) of the 1961 Act |
The Act names provisions of the Income-tax Act, 1961 in clauses (a), (b) and (d). They are quoted as printed; read that law for their meaning.
Sub-sections (3) to (5): recomputation, evidence, transfer pricing
- (3): for clause (2)(c), if the Assessing Officer is of the opinion that any part of the income computed by the assessee is undisclosed, he may recompute it.
- (4): the undisclosed income of the block period is computed on the basis of (a) evidence found as a result of search or survey or requisition; and (b) any other material or information available with the Assessing Officer or coming to his notice in the course of proceedings under Part B.
- (5): income relating to an international transaction or specified domestic transaction under section 166 that pertains to the period from 1 April of the year in which the last authorisation was executed to the date of that execution is, irrespective of section 292(6), not considered in the total undisclosed income of the block period, and is considered in an assessment under the other provisions of the Act.
Sub-sections (6) to (9)
- (6)(a): for a firm, the income for each tax year in the block period is determined before allowing deduction of salary, interest, commission, bonus or remuneration to a partner who is not a working partner. (b): sections 102, 103, 104 and 105 apply so far as may be, with references to tax year read as the relevant tax year in the block period. (c): section 166 applies so far as may be, excluding the period in sub-section (5).
- (7): the tax in section 292(7) is charged on the total undisclosed income determined as in sub-sections (1), (2) and (3).
- (8): losses brought forward from a tax year before the first tax year of the block period under Chapter VII, and unabsorbed depreciation under section 33(11), are not set off against the undisclosed income in the block assessment.
- (9): those losses or unabsorbed depreciation may be carried forward for set-off in the tax year after the year in which the block period ends, for the remaining period, taking into account the block period and that tax year.
Printing note: a stray number printed after "section 292(7)" in sub-section (7) is a footnote mark and is dropped.
A worked example
All names and amounts are assumed.
Ganga Traders, a partnership firm, is subject to a search initiated on 10 September 2027. For one tax year in the block period, a reassessment was pending on that date.
- Abatement. Under section 292(2)(a) the pending reassessment abates on 10 September 2027.
- Excluded income. The firm had declared Rs. 18,00,000 in a return under section 263 for an earlier tax year in the block period before the search. Under section 293(2)(b) that is not included in the total undisclosed income.
- Undisclosed income. Cash found in the search is Rs. 25,00,000, recorded nowhere. The firm declares Rs. 5,00,000 in its block return, and the Assessing Officer determines a further Rs. 20,00,000 from evidence found. Under section 293(1), total undisclosed income = Rs. 5,00,000 + Rs. 20,00,000 = Rs. 25,00,000, charged at the rate specified in section 192 as income of the block period.
- Firm. For the firm, any salary or interest paid to a partner who is not a working partner is not deducted before the income of each year is determined (section 293(6)(a)).
- Losses. A business loss of Rs. 4,00,000 brought forward from before the block period cannot be set off against the Rs. 25,00,000 (section 293(8)); it can be carried forward to the tax year after the block period ends, as sub-section (9) provides.
Need help after a search or requisition?
The interplay of abatement, exclusions and the separate year of search is easy to get wrong, and the amounts left out of the block are as important as those put in. If you are facing a search or a requisition, or a block assessment notice, our team can help you read the position. See our legal dispute resolution service.
Key takeaways
- Part B applies when a search is initiated or requisition made on or after the Act's commencement; the Assessing Officer assesses total undisclosed income of the block period.
- Pending proceedings for years in the block period abate (section 292(2) and (3)), and can revive if the block order is annulled (sub-section (5)).
- Total undisclosed income is charged at the rate specified in section 192, whatever tax years it relates to.
- Income already assessed or declared, and income recorded in books in the normal course, is excluded under section 293(2).
- Brought-forward losses and unabsorbed depreciation are not set off against block undisclosed income, but can be carried forward after the block period.
- The income of the tax year of the search, other than undisclosed income, is assessed separately.
Read next
- Sections 294 and 295: procedure for block assessment and undisclosed income of any other person
- Sections 296 and 297: time limit for block assessment
- Section 247: search and seizure
- Chapter XVI: procedure for assessment
Disclaimer: Based on the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026, as consulted on 2 October 2026. It explains the words of the Act only; the Income-tax Rules, 2026, notifications, circulars, later amendments and the way the tax authorities and courts apply these provisions should be checked. This article is general information, not legal advice; check the official text before acting.