Section 279 of the Income-tax Act, 2025 — Income Escaping Assessment (Reassessment Power)

In plain language

What Section 279 actually says

Section 279 of the Income-tax Act, 2025 is the foundation stone of reassessment. In plain words, it lets the Assessing Officer (AO) go back and tax income that was missed in an earlier year. The section says that if any income chargeable to tax has escaped assessment for a tax year, the AO may — subject to Sections 280 to 286 — assess or reassess that income, or recompute the loss, depreciation allowance or any other allowance or deduction for that year.

This is the modern replacement of the well-known Section 147 of the Income-tax Act, 1961. The 2025 Act (effective 1 April 2026, as amended by the Finance Act, 2026) has re-grouped the old reassessment sections (147 to 153) into a clean block of Sections 279 to 286.

Who it applies to

• Any assessee — salaried individuals, businesses, professionals, companies, firms, HUFs and NRIs — whose income was not correctly taxed in a past year.
• Cases where you did not file a return at all but had taxable income.
• Cases where income was under-reported, wrongly claimed as exempt, or a wrong deduction/loss was taken.
• Cases flagged by data — high-value transactions, foreign assets, mismatches in AIS/26AS, survey findings, or audit objections.

The one rule everyone must remember

Section 279 gives the power, but the AO cannot start a reassessment without first issuing a valid notice under Section 280. A notice under Section 280 is a jurisdictional pre-condition — not a mere formality. If the notice is invalid or time-barred, the entire reassessment collapses.

How Sections 279 to 286 work together

• Section 279 — the core power to assess/reassess escaped income (the "what" and "who").
• Section 280 — issue of the reopening notice; the functional equivalent of the old Section 148. The AO must have information that income has escaped assessment.
• Section 281 — the mandatory show-cause / pre-notice enquiry (like the old Section 148A). The AO must give you the information, hear you out, and pass a reasoned order before reopening.
• Section 282 — the scope of what can be re-examined once reopened.
• Section 283 — time limits for issuing the notice.
• Section 284 — periods excluded while computing limitation (e.g. time consumed by stays, references).
• Section 285 — the sanction / approval of a senior officer before reopening.
• Section 286 — the time limit to complete the reassessment order.

Key conditions and limits (verify against final rules)

• Information-driven, not "hunch"-driven: The AO must possess specific information suggesting escapement — such as risk-management flags, CAG audit objections, information from foreign tax authorities, survey material, or directions of a court/tribunal. This narrows the old open-ended "reason to believe".
• Normal window — 3 years: Generally, a reopening notice can be issued up to 3 years from the end of the relevant tax year.
• Extended window — where escapement is large: Where the income that has escaped is ₹50 lakh or more and is represented as an asset, expenditure or an entry in the books, the notice can go back further (widely reported as up to 5 years under the 2025 Act, tightened from the 10-year outer limit of the old law). Treat the exact outer year as subject to the final notified rules.
• Opportunity of being heard: The pre-notice procedure under Section 281 is compulsory in normal cases.
• Completion deadline: The reassessment order must be passed within the period fixed by Section 286 (broadly about twelve months from the end of the financial year in which the Section 280 notice was served, subject to exclusions).

Practical implications for taxpayers

• Reconcile your AIS/26AS every year. Most reopenings now start from data mismatches, so fixing them at filing stage prevents notices later.
• Never ignore a Section 281 show-cause notice. A good reply with documents can stop the reopening before it starts.
• Check the dates first. A notice issued beyond the 3-year (or 5-year) limit, or without the required senior-officer approval under Section 285, can be challenged as void.
• Keep records for at least 6 years. Bank statements, purchase/sale deeds, investment proofs and books protect you if a past year is reopened.