Section 298
Section 298: interest and penalty for a missed block-assessment return
Section 298 addresses what happens when a person doesn't comply with a notice requiring them to file a return of undisclosed income for the block period, following a search or requisition.
This explanation is AI-assisted and pending review by our CA/CS team. It is general information, not professional advice - always cross-check against the bare law text above or talk to our tax team for guidance specific to your situation.
What triggers this section
Where the return of undisclosed income required under a notice issued under Section 294(1)(a) is not furnished within the period specified in that notice - or is not furnished at all - the interest and penalty consequences that would otherwise apply under the Act for a failure to furnish a return, and for concealment or under-reporting of income, apply in relation to the undisclosed income of the block period, as per the provisions of this Part.
Why this matters
This section ties the block-assessment regime back into the Act's general interest (Section 423 and related) and penalty (Chapter XXI) machinery - a person who ignores or is late responding to a block-assessment notice doesn't escape those consequences just because the notice was for a special block-period return rather than an ordinary annual return.
Frequently asked questions
What happens if I don't file my block-period return in time?
The interest and penalty consequences that otherwise apply under the Act for a failure to furnish a return, or for concealment/under-reporting of income, apply to your undisclosed income for the block period.
Which notice does Section 298 relate to?
The notice issued under Section 294(1)(a), which requires a person to furnish a return of undisclosed income for the block period following a search or requisition.
Related sections
Want this applied to your actual filing, not just explained?
Get help responding to a block assessment noticeLast updated 9 September 2026