“Understand the implications of a Notice under Section 148 of the Income Tax Act, 1961. Learn when it is issued, who can issue it, and the time limits involved. Stay informed to navigate tax assessments effectively.”
When Notice is Issued under section 148 of Income Tax Act, 1961?
Notice u/s 148 of Income Tax Act, 1961, is issued before making assessment, re-assessment u/s 147 of Income Tax Act, 1961 and where Assessing Officer believes that assesse might have escaped assessment.
Assessing Officer shall serve upon assesse a notice in this section after obtaining prior approval of ‘Specified Authority’ to issue such notice.
Specified authority shall be:-
|Principal Commissioner or Principal Director or Commissioner or Director.
|Before Lapse of Three Years or Less than Three Years from the end of relevant Assessment Year.
|Principal Chief Commissioner or Principal Director General or if here is no Principal Chief Commissioner or Principal Director General then Chief Commissioner or Director General.
|After Lapse of More than Three Years from the end of relevant Assessment Year.
No such approval shall be required where AO with prior approval of ‘Specified Authority’ has passed order under clause (d) of Section 148A to effect that it is fit case to issue notice under this section which information can be asked for in notice u/s 148.
Prior enquiry by AO before issuing notice under section 148
Section 148A inserted w.e.f. 01/04/2021 states that before issuing notice u/s 148
1. AO shall conduct enquiry with respect of information which suggest that income chargeable to tax has escaped assessment.
2. To provide opportunity of being heard to assesse by serving show cause notice as to why notice u/s 148 should not be issued on basis of information received.
3. AO should then consider reply furnished by assesse in response to SCN.
4. Then the AO on basis of facts on record and reply of assesse decide whether it is fit case to issue notice u/s 148.
Assessing Officer shall ask the assesse in notice to furnish within such period as specified in notice a return of his income or income of any other person in respect of which he is assessable under IT Act during previous year corresponding to relevant assessment year in prescribed form setting forth such other particulars and provisions of IT Act as if such return were return required to be furnished u/s 139.
‘Information with AO’ means
Information with AO which suggest that income chargeable to tax has escape assessment means:-
1. Any information in accordance with risk management strategy formulated by Board from time to time.
2. Any audit objection to effect that assessment is not according to provisions of IT Act.
3. Information received under an agreement referred to in section 90 & 90A of Act. i.e. (agreements with foreign countries or specified associations).
4. Information made available to AO under scheme notified u/s 135A (faceless collection of information)
5. Information which require action in consequence of order of Tribunal or Court.
AO shall be ‘deemed to have information’ in cases:
1. In case of assesse
2. Where search is initiated u/s 132 or books of account, other documents or any other assets are requisitioned u/s 132A on or after 01/04/2021.
3. Where survey is conducted u/s 133A other than sub section 2A of section 133A on or after 01/04/2021.
4. Where search is initiated or books of accounts, other documents or other assets are requisitioned or survey is conducted in case of assesse.
5. In case of other person
6. Where AO is satisfied with prior approval of Principal Commissioner or Commissioner that money, bullion, jewelry or other valuable articles or things seized or requisitioned u/s 132 or 132A on or after 01/04/2021 belongs to assesse.
7. Where AO is satisfied with prior approval of Principal Commissioner that any books of accounts or documents seized or requisitioned u/s 132 or 132A on or after 01/04/2021 relates to assesse.
8. Where money bullion, jewelry or other valuable articles or things or books of accounts or documents are seized or requisitioned in case of other person.
|If escaped assessment amounts to :
|Less than Rs. 50 Lakhs
|Within 3 years from end of relevant Assessment Year
|Rs.50 Lakhs or More
|Within 10 years from end of relevant Assessment Year
|Where notice pursuant to findings or directions by any authority under IT Act in appeal/ reference/revision.
|By Court in any proceedings under any Law
Time Limit to conclude proceedings after issuing notice u/s 148 of Income Tax Act, 1961
1. Within 9 months from end of Financial Year in which notice u/s 148 was served (if served before 01/04/2019).
2. Within 12 months from end of Financial Year in which notice u/s 148 was served (if served after 01/04/2019).