Section 158BD of the Income Tax Act
Income-tax Act, 2025: s.295
Section 158BD of the Income-tax Act, 1961 corresponds to section 295 (Undisclosed income of any other person) of the Income-tax Act, 2025.
Read section 295 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 158BD is Manish Maheshwari v. ACIT (289 ITR 341), cited in 237 of the 209 judgments on BharatTax that turn on this section.
Leading authorities on Section 158BD
A block assessment proceeding under section 158BD is illegal if the procedure laid down in section 153C is not followed. The provisions of section 153C are similar to section 158BD in block assessment proceedings.
For initiating proceedings under Section 153C against a person other than the one searched, the Assessing Officer (AO) must mandatorily record satisfaction that seized assets/documents belong to that other person. This satisfaction is a jurisdictional prerequisite, even if the AO for both the searched person and the other person is the same.
An assessment cannot be automatically vested with a jurisdictional officer without a formal order under Section 127 of the Income Tax Act. Even intra-city transfers require an order under Section 127.
A notice issued under section 153A of the Income Tax Act to a non-existing or deceased person is invalid in law.