Section 148A: Notice for Non-Furnishing of Income Tax Return, Report/Statement

“Discover insights into Section 148A of the Income Tax Act, 1961, addressing notices for non-furnishing of income tax return, report, or statement. Stay informed about the legal implications, penalties, and important case laws. Source: Finance Act 2021, Legal Analysis.”

Understanding Section 148A of Income Tax Act, 1961: Notice for Non-Furnishing of Income Tax Return, Report or Statement

Section 148A of the Income Tax Act, 1961 is a provision that allows the Assessing Officer (AO) to issue a notice to a person who has failed to furnish a return of income, report or statement of financial transaction. This section was introduced by the Finance Act, 2021, and is applicable from 1st April 2021.

The notice under section 148A can be issued by the AO if they have reason to believe that the person has failed to furnish a return of income under section 139, failed to furnish a report under section 92E, or failed to furnish a statement of financial transaction or reportable account under section 285BA.

The notice can be issued after obtaining the necessary approval from the Principal Commissioner or Commissioner of Income Tax. The notice must be served on the person either by hand or by post. The person must respond to the notice within the specified period, which cannot be less than 30 days from the date of service of the notice.

If the person fails to comply with the notice within the stipulated time, the AO may impose a penalty under section 271F of the Income Tax Act, 1961. The penalty for non-furnishing of the return of income can be up to Rs. 10,000. If the person continues to fail to furnish the return of income even after the imposition of the penalty, the AO may initiate prosecution proceedings under section 276CC of the Income Tax Act, 1961.

It is important to note that the notice under section 148A can be challenged by the person before the Commissioner of Income Tax (Appeals) within 30 days of receiving the notice. The person can also file a writ petition before the High Court or Supreme Court challenging the validity of the notice.

In conclusion, the notice under section 148A is a tool used by the Income Tax Department to ensure compliance with the provisions of the Income Tax Act, 1961. It is important for persons who receive such a notice to respond within the specified time to avoid any penalties or prosecution under the Act.

Important case laws regarding notice under section 148A of th Income Tax act, 1961:

Section 148A of the Income Tax Act, 1961 deals with the issuance of notice for reopening of assessment. Here are some important case laws regarding notice under section 148A:

1. ACIT v. Rajesh Jhaveri Stock Brokers Pvt. Ltd. (2007) 291 ITR 500 (SC)

The Supreme Court held that before issuing a notice under section 148, the assessing officer must have tangible material to come to a belief that income has escaped assessment. The belief must be based on objective facts.

2. CIT v. Kelvinator of India Ltd. (2010) 320 ITR 561 (SC)

The Supreme Court held that if the assessing officer has reason to believe that income has escaped assessment, he may reopen the assessment. However, this power cannot be used to review an assessment already made or to reassess an income in respect of which assessment has already been made.

3. ACIT v. Dhariya Construction Co. (2010) 328 ITR 515 (SC)

The Supreme Court held that the assessing officer must have reason to believe that income has escaped assessment, but this belief cannot be based on mere suspicion or conjecture. There must be some tangible material to support the belief.

4. Pr. CIT v. NRA Iron & Steel Pvt. Ltd. (2019) 264 Taxmann.com 326 (Delhi)

The Delhi High Court held that the assessing officer must record reasons for reopening the assessment under section 148A. The reasons must be communicated to the assessee, and the assessee must be given an opportunity to respond to the reasons.

These are some important case laws regarding notice under section 148A of the Income Tax Act, 1961.