How To Respond to Reassessment Notice U/s 148

How To Respond to Reassessment Notice U/s 148


Reassessment Notice U/s 148 is a notice issue for assessing escape income. The notice can be issue within 6 Years from the end of relevant assessment year. In case if income escape is more than Rs. 1 Lac.

It is general practice in the Income Tax Department not to attach the reasons for reopening . An assessment or for a notice of reassessment u/s 148 of the Income Tax Act. So, the tax payer remains puzzled.

One of my friend had a question:

Can assessing officer issue notice u/s 148 on the basis of report of investigation wing. Is reassessment u/s 147 valid despite the fact he has given the reasons of opening case that investigation department has carried out investigation and found that assessee had escaped income. I think in this case assessing officer has no personal or independent reasons and has not applied his own mind. If we do not comply the notice and proceeding then ex-parte assessment will be valid or against us. what should we do?

From the question above, following issues are require to be answer

  1. One whether an A.O can issue notice for reassessment on the basis of information given by other persons like Audit or Investigation wing or some other source?
  2. What should be proper course of action for you in case a notice for reassessment is serve.

What you should do if you are serve with a notice u/s 148?

Notice for reassessment is serve on any person under section 148 has been laid down by the Supreme Court in GKN Drive Shaft India Ltd vs ITO [2003] 259 ITR 19 .The relevant portion is given below:

“We Clarify That When A Notice Under Section 148 Of The Income-Tax Act Is Issue, The Proper Course Of Action For The Noticee Is To File A Return And If He So Desires, To Seek Reasons For Issuing Notices. The Assessing Officer Is Bound To Furnish Reasons Within A Reasonable Time. On Receipt Of Reasons, The Noticee Is Entitle To File Objections To Issuance Of Notice And The Assessing Officer Is Bound To Dispose Of The Same By Passing A Speaking Order. In The Instant Case, As The Reasons Have Been Disclosed In These Proceedings, The Assessing Officer Has To Dispose Of The Objections, If Filed, By Passing A Speaking Order, Before Proceeding With The Assessment.” Notice U/s 148

In plain words, the proper course of action in case notice u/s 148 is serve, both for You and the A.O are :

  1. You Have To File The Return Of Income In Response To Notice U/S 148.
  2. After that, If You Desire, Can Seek Reasons For Issuing Notices.
  3. The Assessing Officer Is Bond To Furnish Reasons Within A Reasonable Time if ask for.
  4. You Can Object The Reasons Of Reopening At This Stage.
  5. The Assessing Officer Has To Dispose Of The Objections By Passing A Speaking Order.
  6. Then Only, A.O. Can Proceed With The Assessment.

Therefore, I suggest you to file the return and submit written objection on the reasons. If the assessing officer rejects your objection. File an appeal before CIT(A) against the order of rejection as per Apex Court’s judgment. But always reply to the questionnaire given to you by the A.O or appear on scheduled time before the A.O . But never forget to write in each submission made by you that you are filing submission only under protest. Do not let the order passed u/s 144 as ex-parte. Notice U/s 148


Madhu Shahu…

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