The article below gives an insight into the details of Section 148. Read to know more!
Citing Section 148 of the Income Tax Act, 1961, the article below provides an overview of the rights and duties of an assessee under the IT Act, 1961. The concept of the assessee has been defined in section 2(9) of the IT Act, 1961. It represents any person who has or may be liable to pay any income tax under this Act or any corresponding law enacted by any state or union territory.
Section 148 lays down the duties & rights of the assessee in general and that of a large corporate taxpayer. In addition, it protects honest taxpayers from harassment by the Income Tax Department. Section 148 of the Income Tax Act, 1961 deals with the following duties and rights of the assessee.
A Brief About Section 148
Section 148, which comes under Chapter II of The Income Tax Act, 1961, deals with various duties and rights related to tax assessment. For example, it is mentioned that every taxpayer must maintain proper books and records for income tax purposes. Apart from it, several other responsibilities are also highlighted.
For instance, all assessees are liable to submit a return before 1 June each year. It further mentions that if any assessee fails to do so, he will be charged a penalty and interest. Besides such provisions, there are several others, like penalties for furnishing false information, etc. You can find all these details in section 148 of The Income Tax Act, 1961 (43 of 1961).
Assessee’s Duties under Section 148
Assessee means any person, Hindu undivided family, or artificial juridical person (including a limited liability partnership) liable to pay income tax under any Act for the financial year. You must fulfil certain obligations as an assessee and have rights conferred upon you by Section 148. A brief overview of Section 148 is given below:
- The assessee will be obligated to provide details regarding incomes earned during the preceding financial year in Form No 16
- The assessee shall furnish a return of income if it has failed to furnish such return within the due date under Section 139(1)
- Any tax deducted at the source which has not been credited to the government account should be refunded if one did not claim it within the time limit prescribed in Section 192(2)
- An individual who is non-resident or ordinarily resident but becomes resident during FY 2017-18 shall submit Form No 15B concerning assets held outside India before the deadline
- An individual income from a business or profession must file Income Tax Return under Section 139(4)
- If an assessee fails to pay advance tax by the due date, he will be liable for penalty u/s 234C
- If TDS has been deducted on interest accrued on fixed deposit but not deposited in the government treasury, then he may have to pay interest u/s 234F.
Assessee’s Rights under Section 148
Section 148 gives Assessees certain rights, including audits, appeals, and reassessment. Knowing what your rights are under Section 148 can prove helpful in cases such as when your returns are audited or you’re issued a tax notice from your local SDM (Sub-Divisional Magistrate). To know your rights and make sure they’re protected, read on to discover how Section 148 grants you certain rights and what you can do if they’re violated.
Section 148 is one of several sections that deal with income tax law and administration in India. It provides an overview of what happens after an assessee files his return. The following is a brief overview of Section 148: Sections 1 to 6 layout requirements for filing income tax returns and provide information about who must file, who may file, and where they must be filed. Sections 7 to 10 describe deductions allowed by law.
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Individuals Who Are Authorised To Issue Notice Under Section 148
The Income Tax officer is authorised to issue a notice under Section 148 to an assessee if he believes that any person who must make any statement or return under section 139 or section 141 omits so. Such notice shall be served personally or by registered post addressed to such person at his last known place of residence or business, as recorded with proper authority.
Any such notice may also be served by leaving it at his usual or last known place of residence or business during ordinary hours for receiving mail. If there is more than one such person, then all of them can be sent one notice. However, if different addresses have been given to different people, separate notices may have to be issued for each person. No other method shall be used for serving any notice except those mentioned above.
Power of the Assessing Officer Under Section 148
Section 148 empowers an Assessing Officer to assess or reassess any taxable income that may have been overlooked and not assessed according to the guidelines of the Income Tax Act. If the Assessing Officer suspects that an assessee’s taxable income has escaped assessment, they can exercise their authority to conduct an assessment or reassessment as provided under Sections 147 to 153.
Reasons For Issuance of Notice To An Assessee By An Assessing Officer Under Section 148
- Before issuing a notice to an assessee under Section 148, an Assessing Officer must have concrete evidence that the assessee has evaded income assessment for the relevant year. The officer cannot issue a notice based solely on suspicion.
- There must be a clear connection between the information or material provided to the Assessing Officer and the belief that the assessee has escaped income assessment. The information must be highly relevant and not based on superficial facts.
- Before issuing any notice under Section 148, the Assessing Officer is required to record and provide written reasons explaining why they believe the assessee is evading income assessment. Merely stating that the assessee has concealed a significant amount of income or needs further investigation, without concrete evidence, will not be sufficient and will be considered vague
- An Assessing Officer cannot issue a notice based on a difference in opinion or perspective without new, relevant information. If the assessee has disclosed all necessary details about their taxable income and provided factual information, which has led to the completion of their assessment or reassessment, there is no basis for issuing a notice
- The officer cannot issue a notice simply by drawing new conclusions from documents and information that have already been provided. A notice can only be issued if new information or material comes to light
- However, if it is discovered later that the assessee has concealed or failed to disclose relevant information, the Assessing Officer has the authority to issue a notice under Section 147/148.
Conclusion
The assessee has the right to be represented by an authorised representative at any proceedings under the Act. The authorised representative may be a chartered accountant, a cost accountant, or a company secretary in whole-time practice.
Section 148 of the Income tax Assessment Tax Act, 1961 deals with the duties and rights of the assessee. The assessee must furnish all the relevant information and documents to the tax authorities. The assessee must also file the income return within the prescribed time.
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Frequently Asked Questions
How do you respond to a notice under Section 148?
To respond to a notice under Section 148, the assessee should file a return of income for the relevant assessment year, providing accurate details and evidence to address the issues raised. Additionally, the assessee should engage with the Assessing Officer, submitting required documents and explanations promptly.
What does Section 148 deal with?
Section 148 of the Income Tax Act allows the Assessing Officer to issue a notice to an assessee if they have reason to believe that income has escaped assessment. This section enables the reassessment of income that was not previously assessed or was incorrectly assessed.
What is the revised guideline for issuing a Section 148 notice?
The revised guideline for issuing a Section 148 notice requires the Assessing Officer to have concrete evidence of income evasion. They must record and provide written reasons for their belief that income has escaped assessment and cannot issue notices based on mere suspicion.
Is it compulsory to file a return under Section 148?
Yes, it is compulsory to file a return under Section 148 if a notice is received. The assessee must submit a return for the relevant assessment year to address the issues raised and facilitate the reassessment process.
What is Section 148's reason to believe?
Reason to believe under Section 148 refers to the Assessing Officer’s genuine and informed belief, based on evidence, that income has escaped assessment. It requires a factual basis and not mere suspicion or conjecture for issuing a notice.
What is the time limit for a Section 148 notice?
The time limit for issuing a Section 148 notice is typically within four years from the end of the relevant assessment year. However, this can be extended to up to six years if the income escaping assessment exceeds a specified threshold.
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