Time limit for completion of assessment, reassessment and recomputation
[Section-286 as per the Income Tax Act, 2025 (this Act) w.e.f. 1st April, 2026.]
Section 286(1) of Income Tax Act 2025
286(1) No order in respect of proceedings mentioned in column B of the Table below shall be made after expiry of the period specified in column D of the said Table and calculated from the date as mentioned in column C thereof.
Table
| Nature of Proceedings or orders | Date from which time limit for completion is to be calculated | Time limit for completion |
|---|---|---|
| 1. Assessment order under section 270(10) or section 271. | End of the financial year succeeding the relevant tax year. | One year. |
| 2. Assessment order under section 270(10) or 271, where an updated return of income is furnished under section 263(6). | End of the financial year in which such updated return was furnished. | One year. |
| 3. Assessment order under section 270(10) or 271, where return is furnished in consequence of order under section 239(3)(b). | End of the financial year in which such return was furnished. | One year. |
| 4. Assessment, reassessment or recomputation order under section 279. | End of the financial year in which notice under section 280 was served. | One year. |
| 5. Fresh assessment order or fresh order under section 166 in pursuance to an order under section 359, or 363, or 377, or 378 setting aside or canceling an assessment order or an order under section 166. | End of the financial year in which order under section 359 or 363 is received, or order under section 377 or 378 is passed, by the jurisdictional Principal Commissioner or Commissioner. | One year. |
| 6. Assessment or reassessment which stands revived, as per section 153A(2) of Income-tax Act, 1961 (43 of 1961), or section 292. | End of the month in which such assessment or reassessment stands revived. | One year. |
| 7. Assessment required to be made in the hands of partner, in consequence of an assessment made on the firm under section 279. | End of the month in which assessment order in the case of firm is passed. | One year. |
| 8. Assessment, reassessment or recomputation required to be made on the assessee or any person in consequence of or to give effect to any finding or direction contained in an order–– (i) under section 359 or 363 or 365(10), or 368, or 377 or 378; or (ii) of any Court in a proceeding otherwise than by way of appeal or reference under this Act. | End of the month in which such order is received, or passed, by the jurisdictional Principal Commissioner or Commissioner. | One year. |
| 9. Order giving effect to an order under section 359 or 363 or 365(10) or 368 or 377 or 378, otherwise than by making a fresh assessment or reassessment or fresh order under section 166, where–– (i) verification of any issue by way of submission of any document by the assessee or any other person is to be carried out; or (ii) an opportunity of being heard is to be given to the assessee. | End of the month in which order under section 359 or 363 or 365(10) or 368 is received, or order under section 377 or 378 is passed, by the jurisdictional Principal Commissioner or Commissioner. | One year. |
| 10. Order giving effect to an order under section 359 or 363 or 365(10) or 368 or 377 or 378 otherwise than by making a fresh assessment or reassessment or fresh order under section 166. | End of the month in which order under section 359 or 363 or 365(10) or 368 is received, or order under section 377 or 378 is passed by the jurisdictional Principal Commissioner or Commissioner. | Six months, extendable to nine months with the approval of authorities as per section 2(62) and (64) |
| 11. Modification of assessment, reassessment or recomputation to give effect to the order passed under section 166 read with section 377 | End of the month in which such order under section 166 is received by the Assessing Officer. | Two months. |
Section 286(2) of Income Tax Act 2025
286(2) Time limit for completion of any assessment or reassessment as provided in sub-section (1), in a case where reference is made to the Transfer Pricing Officer for determining the arm’s length price under section 166(1), shall be extended by an additional period of twelve months.
Section 286(3) of Income Tax Act 2025
286(3) For the purposes of this section, in computing the time limit for completion, the following period shall be excluded,––
- 286(3)(a) the time taken in reopening the whole or any part of the proceeding on request of the assessee or in giving an opportunity to the assessee to be re-heard under section 244;
- 286(3)(b) the period commencing on the date on which stay on assessment proceeding 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;
- 286(3)(c) the period commencing from the date on which the Assessing Officer intimates the Central Government or the prescribed authority, the contravention of the provisions of Schedule III (Table: Sl. No. 23, 24, 25) or section 270(11)(i), and ending with the date on which the copy of the order withdrawing the approval or rescinding the notification, as the case may be, under those provisions is received by the Assessing Officer;
- 286(3)(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 section; or
- (ii) where such direction is challenged before a court, ending with the date on which the order setting aside such direction is received by the Principal Commissioner or Commissioner;
- 286(3)(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 him;
- 286(3)(f) the period (not exceeding sixty days) commencing from the date on which the Assessing Officer received the declaration under section 375(1) and ending with the date on which the order under section 375(3) is made by him;
- 286(3)(g) 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 either rejecting the application or the advance ruling pronounced by it, is received by the jurisdictional Principal Commissioner or Commissioner under section 384(5) or (8), as the case may be;
- 286(3)(h) the period commencing from the date on which a reference or first of the references for exchange of information is made by an authority competent under an agreement referred to in section 159 and ending with the date on which the information requested is last received by the jurisdictional Principal Commissioner or Commissioner, or one year, whichever is less;
- 286(3)(i) the period commencing from the date on which a reference for declaration 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;
- 286(3)(j) the period (not exceeding one hundred eighty days) commencing from the date on which a search is initiated under section 247 or a requisition is made under section 248 and ending on the date on which the seized items or the requisitioned items, are handed over to the Assessing Officer having jurisdiction over the assessee,—
- (i) in whose case such search is initiated under section 247 or such requisition is made under section 248; or
- (ii) to whom any money, bullion, jewellery, virtual digital asset or other valuable article or thing seized or requisitioned belongs to; or
- (iii) to whom any books of account or documents seized or requisitioned pertains or pertain to, or any information contained therein, relates to;
- 286(3)(k) the period commencing from the date on which the Assessing Officer makes a reference to the jurisdictional Principal Commissioner or Commissioner under the section 270(13) and ending with the date on which copy of the order under of section 351(2)(ii)(A) or (B), is received by the Assessing Officer.
Section 286(4) of Income Tax Act 2025
286(4) Where immediately after exclusion of the period as mentioned in sub-section (3), the remaining period for completion available to the Assessing Officer, as specified in sub-section (1), for making an order of assessment, reassessment or recomputation, is less than sixty days, such remaining period shall be extended to sixty days and the aforesaid time limits for completion shall be deemed to have been extended accordingly.
Section 286(5) of Income Tax Act 2025
286(5) Where the period available to the Transfer Pricing Officer is extended to sixty days as per section 166(8) and the remaining period for completion available to the Assessing Officer under this section, for making an order of assessment, reassessment or re-computation, is less than sixty days, such remaining period shall be extended to sixty days and the aforesaid time limit for completion shall be deemed to have been extended accordingly.
Section 286(6) of Income Tax Act 2025
286(6) Where a proceeding before the Interim Board for Settlement abates under section 245HA of the Income-tax Act, 1961 and the remaining period of limitation available to the Assessing Officer under this section for making an order of assessment, reassessment or re-computation, after the exclusion of the period under section 245HA(4) of the Income-tax Act, 1961, is less than one year, such remaining period shall be deemed to have been extended to one year; and for the purposes of determining the period of limitation under sections 282, 287, 288 and 296 and for the purposes of payment of interest under section 437, this sub-section shall also apply accordingly.
Section 286(7) of Income Tax Act 2025
286(7) In a case where the remaining time period for making an order of regular or reassessment, after excluding the time period specified in sub-section (3)(k), ends before the end of the month, the remaining period shall be extended to the end of such month, and the specified time limit for completion shall be deemed to have been extended accordingly.
Section 286(8) of Income Tax Act 2025
286(8) For the purposes of this section and section 283, where by an order referred to in entry in sub-section (1) (Table: Sl. No. 8.A)––
- (i) any income is excluded from the total income of the assessee for a tax year, then, an assessment of such income for another tax year shall be deemed as one made in consequence of or to give effect to any finding or direction contained in the said order; or
- (ii) any income is excluded from the total income of one person and held to be the income of another person, then, an assessment of such income on such other person shall be deemed as one made in consequence of or to give effect to any finding or direction contained in the said order, if such other person was given an opportunity of being heard before the said order was passed.
FAQs on Section 286 of Income Tax Act 2025
What is the general time limit for completion of an assessment under section 270(10) or 271?
The order must be made within one year from the end of the financial year succeeding the relevant tax year.
What is the time limit for assessment where an updated return under section 263(6) is filed?
One year from the end of the financial year in which the updated return was furnished.
What is the time limit for assessment when return is furnished due to an order under section 239(3)(b)?
One year from the end of the financial year in which such return was furnished.
What is the time limit for assessment, reassessment or recomputation under section 279?
One year from the end of the financial year in which notice under section 280 was served.
What is the time limit for fresh assessments or orders under section 166, in consequence of appellate/revisionary orders?
One year from the end of the financial year in which such appellate or revisionary order is received or passed.
What is the time limit when assessment or reassessment is revived under section 292?
One year from the end of the month in which such assessment or reassessment is revived.
What is the time limit for assessment in the hands of a partner due to assessment of the firm?
One year from the end of the month in which the firm’s assessment order is passed.
What is the time limit for assessment due to findings or directions of certain authorities or court orders?
One year from the end of the month in which such order is received or passed by the jurisdictional Principal Commissioner or Commissioner.
What is the time limit for orders giving effect to appellate or revisionary orders, where hearing or verification is needed?
One year from the end of the month in which the order is received or passed by the jurisdictional authority.
What is the time limit for orders giving effect to appellate or revisionary orders, without requiring fresh assessment or hearing?
Six months from the end of the month in which such order is received or passed; extendable to nine months with approval.
What is the time limit for modifying an assessment to give effect to a section 166 order read with section 377?
Two months from the end of the month in which such order is received by the Assessing Officer.
Is there any extension in time limit if a Transfer Pricing Officer reference is made?
Yes, an additional twelve months are added to the time limit.
What periods are excluded while computing the time limit under section 286(3)?
Various periods such as stay by courts, audit directions, valuation references, settlement applications, or time taken in certain cross-border information requests are excluded.
What happens if the remaining period after exclusions is less than sixty days?
It shall be extended to sixty days.
What if the Transfer Pricing Officer’s time is extended and less than sixty days remain for the AO?
Then the Assessing Officer’s remaining time shall also be extended to sixty days.
What if a proceeding before the Interim Board for Settlement abates?
If less than one year remains after exclusions, the period shall be extended to one year.
What if the time remaining after excluding period under section 286(3)(k) ends before month-end?
Then the period is extended till the end of that month.
What if income is excluded in an order and needs assessment in another year or person?
Such assessments are deemed to be made in consequence of that order if opportunity of being heard was provided.
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