Income Escaping Assessment and Issue of Notice under Section 147, 148 and 148A of Income Tax Act 1961

Sections 147, 148 and 148A of the Income Tax Act, 1961 contain provisions relating to reassessment where income chargeable to tax has escaped assessment.

Section 147 Income Tax Act 1961: Income Escaping Assessment

Where the Assessing Officer has information and reason to believe that income chargeable to tax has escaped assessment, the Assessing Officer may assess or reassess such income subject to the provisions of sections 148 to 153.

The reassessment proceedings may also include any other income chargeable to tax which comes to the notice of the Assessing Officer during the proceedings.

Section 148 Income Tax Act 1961: Issue of Notice

Before making assessment, reassessment or recomputation under section 147, the Assessing Officer shall issue notice under section 148 in accordance with the procedure prescribed under the Act.

No notice under section 148 shall be issued unless there is information available with the Assessing Officer suggesting that income chargeable to tax has escaped assessment and the required approval of the specified authority has been obtained.

Section 148A Income Tax Act 1961: Inquiry Before Issue of Notice

Before issuing notice under section 148, the Assessing Officer shall follow the procedure under section 148A, including conducting inquiry where required, providing opportunity of being heard to the assessee, considering the reply and deciding whether it is a fit case for issue of notice.

Important Points

• Reassessment proceedings must follow the statutory procedure under sections 147 to 153.
• The assessee must be provided the opportunity required under section 148A wherever applicable.
• The Assessing Officer must record reasons and comply with approval requirements before issuing notice.
• Time limits for reassessment are governed by section 149 of the Income Tax Act.