Section 148 of the Income Tax Act, 1961 deals with the issuance of notice wherein any income is found to have escaped re-computation or assessment. The section asserts that an Assessing Officer so assigned will intimate the assessee in question by sending them a notice wherein they will be required to produce the following information:
- All dates for Notices, Intimations, Appeals, Return Statements etc where the time limit was expiring between 20th March 2020 to 29th June 2020 has now been extended to 30th June 2020.
- Vivvad Se Vishwas Scheme - No interest & penalty would be levied if tax payments are done by 31st December 2020.
- Date of assessments expiring on 30th Sep 2020 has been extended to 31st Dec 2020 and those expiring on 31st March 2021 is extended to 30th Sep 2021.
- The Government gives another helping hand to small taxpayers like partnership firms, LLP, cooperative societies, charitable trusts, non-corporates and professionals in fighting COVID-19 crisis by immediately issuing all pending refunds.
The assessee is required to produce the details of his/her income tax returns within 30 days of the duration that has been specified by the assessing officer in the notice given. In the case that the assessee needs to provide income tax returns of any other assessable person, then he or she has to provide them in the format specifically mentioned as per provisions of the act, with any other information to be provided with the detailed information. Before the issuance of a notice, the Assessing Officer will not state the reason for the notice given to the assessee in question.
1. His or her rank or position is below that of a Joint Commissioner
2. The four-year period following the conclusion of the assessment year of connectedness has terminated
Note that this may be solely circumvented by the Joint Commissioner, provided he or she is content that the explanations given by the Assessing Officer are valid enough for the issuance of a notice to the assessee in question.
When a notice under section 148 is received, the assessee is asked to file a return of the relevant assessment year. After filing the return the assessee must ask for a copy of reasons recorded for issuing of a notice under section 148, after which they are permitted to file an objection to the issuance of notice. The assessee must specifically ask the assessing officer to pass a speaking order by disposing of the objections giving reference of the Judgment of Honorable Supreme Court in GKN Driveshafts (India) Ltd vs ITO (2003) 259 ITR 19 (SC). The objections are to be filed highlighting the reasons for challenging the legality of the notice issued under Section 148. All of these procedures have been laid down by the Honorable Supreme court in GKN Driveshafts (India) Ltd case. This procedure was provided by the Honorable Supreme court to enable the assessee to file a writ petition before the respective High Court challenging the legality of the notice served under Section 148 before the assessment is completed.
In the case that assessment order is passed and the matter is in appeal, the assessee may still file writ petition in the high court challenging the legality of the notice under section 148 and even the consequent assessment if the above procedure as laid down by the Supreme Court in GKN Driveshafts (India) Ltd case is not followed. For this to happen, the assessee will have to show proof that he asked for a copy of reasons for issue of notice under section 148 and filed objections to that and asked the assessing officer to pass a separate reasoned order disposing of the objections filed and deciding on the legality of the notice issued Under Section. 148.
If the Income Tax return is not furnished by the assessee within the timeframe underlined in the notice issued under Section 148 by the presiding Assessing Officer, the assessee shall be made to pay interest under Section 243(3) for late filing of Income Tax return or for not filing of Income Tax return, if the income has already been determined under Section 143(1) or if the income if the assessment has already been done under Section 144 or Section 147.
Contrarily, if the assessee hadn’t furnished any return with respect to any assessment year and no assessment of such year has been done under Section 144, then the interest of late filing of return in response to notice under Section 148 shall be levied on the assessee under Section 234(1) instead of Section 234(3).