CBDT Issues Guidelines for Notices Under Section 148 of the Income Tax Act
Date: July 08, 2024
Category: CBDT Notification | Income Tax Updates
The Central Board of Direct Taxes (CBDT) has issued comprehensive guidelines on June 26, 2024, for issuing notices under Section 148 of the Income Tax Act, 1961. The guidelines, detailed in notification F.No.299/10/2022-Dir(Inv.III)/1522, outline the criteria and processes to ensure transparency and fairness in income tax reassessments. Below are the key points:
Credible Information Requirement for Section 148 Notices
Notices under Section 148 of the Income Tax Act can only be issued based on credible information indicating that income has escaped assessment. The sources of this information include:
- Risk management systems
- Audit objections
- Information exchange agreements
- Whistleblower schemes
- Court orders
Approval for Reassessments Beyond Three Years
For reassessment cases extending beyond three years from the relevant assessment year, approval from a specified authority is mandatory. This measure ensures thorough scrutiny and prevents frivolous reassessments.
Detailed Documentation and Enclosures
The notices must be accompanied by relevant information and supporting documents. This includes:
- Details from the Investigation Wing or law enforcement agencies with appropriate redactions
- The Assessing Officer’s (AO) name and designation
- Any judicial orders relied upon in the notice
Show Cause Notice Under Section 148A
Before a final reassessment notice is issued, the AO must provide the assessee with a show cause notice under Section 148A. This notice should:
- Explain the reasons for the reassessment
- Provide an opportunity for the assessee to respond and present their case
Time Limits and Thresholds for Reassessment Notices
Generally, reassessment notices must be issued within three years from the end of the relevant assessment year. However, this period can be extended to ten years if the escaped income exceeds Rs. 50 lakh, focusing on cases with significant tax implications.
These guidelines by the CBDT aim to enhance the process’s transparency and fairness, ensuring that income tax reassessments are conducted efficiently and justly. For more detailed information on these guidelines, refer to the full notification issued by the CBDT.
CBDT Guidelines, Section 148 Income Tax Act, Income Tax Reassessment, Tax Notices, Reassessment Process, Credible Information, Show Cause Notice, Income Tax Updates, Tax Compliance, CBDT Notification 2024
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