Off let Income tax Department has started issuing notices under section 143(2) of the Income tax Act, 1961 (Act) for the AY 2020-21 through online mode or through National e-Assessment Facilitation Center highlighting certain issues for which case has been selected for scrutiny assessment proceedings. Let us understand the aspects of the same in view of the provision of Income tax Act.
As a procedure department issues notice under section 143(2) of the the Act to submit pr produce any evidence in support of his return of income and the time limit for issue of 143(2) notice has been reduced to 3 months from the end of the FY in which return was filed. In notices issued under faceless assessment scheme, only issues are highlighted for selecting the case for scrutiny assessment, however no requirements are specified in the said notice.
Notice under section 143(2) is issued for the following:
- Assessee has not understated income;
- Assessee has not computed excessive loss;
- Assessee has not underpaid tax;
In the above cases, AO or department shall issue the notice requiring assessee to produce any evidence on which the assessee may rely in support of his return.
In order to make an assessment or inquiry for an assessment department is required to issue notice under section 142(1). Generally, notice issued under section 142(1) contains specific requirement and format in which information is required to be submitted. Important to note that there is no time limit to issue the notice under section 142(1) of the Act. From reading of section 153 read with 143 of the Act, time limit for completion of assessment is as under:
| Sr. No. | Assessment relating to AY | Time Limit |
| 1 | Assessment relating to AY 2017-18 or before | 21 months from the end of AY i.e. 31st December 2019 |
| 2 | Assessment relating to AY 2018-19 | 18 months from the end of AY i.e. 30 th September 2020 |
| 3 | Assessment relating to AY 2019-20 and AY 2020-21 | 12 months from the end of AY i.e. 31st March, 2021 for AY 2019-20 and 31st March, 2022 for AY 2020-21 |
| 4 | Assessment relating to AY 2021-22 | 9 months from the end of AY i.e. 31st December, 2022 |
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