Section 158BI — Chapter Not to Apply in Certain Circumstances (Omitted) (Omitted)

CHAPTER XIV-B — SPECIAL PROCEDURE FOR ASSESSMENT OF SEARCH CASES (BLOCK ASSESSMENT)

Section 158BI — Chapter Not to Apply in Certain Circumstances (Omitted)

Case Laws & Commentary · Income-tax Act, 1961 (as amended by the Finance Act, 2026) · bharattax.co Treatise

Status: Omitted. Section 158BI was omitted by the Finance Act, 2025 with retrospective effect from 1 September 2024. In its earlier life (in the 1995–2003 Chapter) it performed the opposite function — shutting Chapter XIV-B for searches initiated after a cut-off date — and it is preserved here for completeness and to explain the legislative architecture of the revived scheme. No section now bears the number 158BI in force.

FA 2026: No amendment by the Finance Act, 2026 (the section having already been omitted by the Finance Act, 2025).

A. SECTION COMMENTARY

A note on the revived regime: Chapter XIV-B (block assessment) was originally introduced by the Finance Act, 1995 with effect from 1 July 1995 and applied to searches initiated between 1 July 1995 and 31 May 2003, after which it was displaced by the section 153A–153C regime (the old section 158BI having shut the Chapter for searches after 31 May 2003). The Finance (No. 2) Act, 2024 has revived and substantially re-enacted Chapter XIV-B, with effect from 1 September 2024, for searches under section 132 or requisitions under section 132A initiated on or after that date; the Finance Act, 2025 then refined the revived provisions (and omitted section 158BI). Because the revived sections are new, there is as yet no judicial construction of them. The authorities collected here are decisions on the materially identical provisions of the 1995–2003 Chapter XIV-B (and, where flagged, on the cognate sections 153A–153C); they remain the most reliable guide to the meaning of the recast text, and are cited as such with that caveat stated candidly.

Section 158BI was historically the 'sunset switch' of the block-assessment Chapter. In the original Chapter XIV-B, it provided that the Chapter would not apply where a search was initiated, or a requisition made, after 31 May 2003 — the date from which the section 153A–153C regime took over. It was the textual mechanism by which the first life of block assessment was brought to a close.

When the Finance (No. 2) Act, 2024 revived Chapter XIV-B for searches on or after 1 September 2024, a provision of this kind became unnecessary: the revived sections themselves carry the new 1 September 2024 trigger, and the dividing line between the two regimes is drawn by the section 132/132A initiation date written into sections 158BA, 158BC and the rest. The Finance Act, 2025 accordingly omitted section 158BI with retrospective effect from 1 September 2024, removing a provision that would otherwise have sat awkwardly within a Chapter designed to apply (not to cease applying) from that date.

The omission has no separate operative content of its own; it is a tidying of the statute consequent on the revival. In candour, there is no case law on the omitted section in its revived-Chapter avatar, and none is to be expected, since it was removed before it could operate. The transition logic — that a fresh fiscal regime applies from the date the statute fixes, and that the choice between the block regime and the section 153A regime is governed by the initiation date of the search — is illustrated by the cognate prospectivity authority noted below.

B. STATUTORY POSITION (verbatim text)

Section 158BI has been omitted; there is no statutory text in force. For the reader's convenience, the text as it stood immediately before omission (preserved in the local Act's footnote apparatus) read in substance as follows.

158BI. Chapter not to apply in certain circumstances.— [As it stood before omission by the Finance Act, 2025, with retrospective effect from 1 September 2024] The provisions of this Chapter shall not apply where a search was initiated under section 132, or books of account, other documents or any assets were requisitioned under section 132A, before the 1st day of September, 2024.

The above is the pre-omission text of the revived section 158BI as preserved in the local Act's footnotes; it confined the revived Chapter to searches/requisitions initiated on or after 1 September 2024, and was omitted as redundant once that trigger date was written into the operative sections. (This is distinct from the original 1995-Chapter section 158BI, which had excluded searches initiated after 31 May 2003.)

C. AUTHORITIES

Section 158BI is omitted and was never operative in the revived Chapter; in candour there is no decision construing it. The cognate authority explains the transition/prospectivity logic the omission reflects.

1. Transition and prospectivity of a fresh fiscal regime (cognate)

CIT v. Vatika Township (P) Ltd. (2015) 367 ITR 466 (SC) — cognate (prospectivity)

Court: Supreme Court of India; Constitution Bench, judgment dated 15 September 2014.

Held: Legislation imposing a fresh fiscal burden is presumed prospective unless the statute, expressly or by necessary implication, provides otherwise; a beneficial or clarificatory provision may be retrospective. The legislature's intention, gathered from the language and object, governs.

Significance: Cognate authority on temporal application — relevant to the transition cut-offs of the revived Chapter ('on or after the 1st day of September, 2024') and to the omission of the old section 158BI.

2. The regime boundary is fixed by the date of initiation of the search

Old Chapter XIV-B / section 153A / revived Chapter XIV-B — the dividing dates

Position: Block assessment under the original Chapter XIV-B applied to searches initiated between 1 July 1995 and 31 May 2003; the section 153A–153C regime applied to searches initiated on or after 1 June 2003 (up to 31 March 2021, with the section 147–151 reassessment route thereafter); and the revived Chapter XIV-B applies to searches initiated on or after 1 September 2024. The applicable regime is determined by the date the search under section 132 was initiated or the requisition under section 132A was made.

Significance: The omitted section 158BI's only function was to mark such a boundary; in the revived Chapter that function is performed by the 1 September 2024 trigger embedded in the operative sections.

Compiled for the bharattax.co Treatise on the Income-tax Act, 1961 (as amended by the Finance Act, 2026). Statutory text reproduced from the local Act (base text amended up to the Finance Act, 2025), with the publisher's footnote apparatus and amendment-marker brackets removed; three asterisks (***) denote words or a sub-section omitted by amendment. Finance Act, 2026 changes are flagged in the commentary. Citations are stated as reported and have been cross-checked; decisions of the Income-tax Appellate Tribunal and High Courts are identified as such, and decisions rendered under the 1995–2003 Chapter XIV-B or the cognate sections 153A–153C are flagged where relied upon, since the revived sections are not yet judicially construed. Where a section is genuinely sparse of authority, that is stated candidly rather than padded. Not legal advice.