Section 148 of the Income Tax Act, 1961 empowers the Income Tax Department to reassess an individual's previously filed income tax returns. This section allows the Assessing Officer to issue a notice under Section 148 if there is a suspicion that the taxpayer has not disclosed their complete income or has provided inaccurate information. In this article, we will explore the details of Section 148, the process of issuing a notice, the time limits involved, and the rights and responsibilities of the taxpayer.
The Assessing Officer has the authority to send a notice to a taxpayer whose income has not been properly assessed under Section 148 of the Income Tax Act of 1961. If the officer believes the taxpayer has not disclosed all of their income or has provided false information, they may start legal action under this section. A Section 148 Notice is used to reassess the taxpayer's income tax return and is the notice given under Section 148.
The Finance Act of 2022 included Section 148A, which mandates that the Assessing Officer inquire first and give the taxpayer a chance to present their case before issuing a notice under Section 148. The assessing officer must give the taxpayer a chance to respond with their own information and supporting evidence after presenting information and material that suggests income has escaped assessment.
Within the following time frames, a notice under Section 148 may be published for the applicable assessment year:
Only if the taxpayer has submitted their returns in accordance with Section 139, failed to do so after receiving a notice under Section 142 or Section 148(1), and provided all necessary information for the Assessing Officer to complete the assessment of that relevant year can the Assessing Officer issue a notice under Section 148.
A notice under Section 148 must be responded to by the taxpayer within the allotted time period, which is typically 30 days, if at all possible. The taxpayer can reply to the notice by filing a return or sending a written response to the Assessing Officer with all the required information and supporting documentation.
The following must be done in order to respond to a notice under Section 148:
After receiving a notice under Section 148, the assessee has certain duties and rights. These include:
The window for reopening income tax assessment cases has been shortened from six to three years as part of the Union Budget 2021. In cases of serious tax evasion, assessments may be reopened for up to ten years, provided the hidden income exceeds Rs. 50 lakhs.
The Income Tax Department may reassess a taxpayer's income tax return if there is a suspicion that income is evading assessment under Section 148 of the Income Tax Act of 1961. It is crucial for taxpayers to respond quickly and completely to any notice they receive under this section by providing accurate and detailed information about their income and outgoings. Taxpayers can guarantee a just and legal assessment of their tax liabilities by cooperating with the authorities and adhering to the rules.