12 May 2017
as per section 147 the assessing officer can assess or reassess any income which comes into his notice during the proceedings.
So if he came to know and has reason to believe of some additional income not mentioned under section 148.
Then fresh notice under section 148 will be necessary for that additional income or not?
pls help.
13 May 2017
If the AO makes addition on the allegation in the original notice, he has the power to make any other addition also without issuing a fresh 148. But if the original allegation does not sustain, no additional additions can be made. The best course in this case is to challenge 148 by way of a writ petition before the High Court.
29 July 2024
**Section 147 and 148 of the Income Tax Act, 1961** deal with the powers of the Income Tax Officer (ITO) to reassess income that has escaped assessment. Here’s a detailed explanation to address your queries:
### **Understanding Section 147 and 148**
**1. **Section 147 - Income Escaping Assessment:** - **General Provision:** This section allows the ITO to assess or reassess income if they have reason to believe that any income chargeable to tax has escaped assessment. This is a broad provision allowing the officer to address income that was not assessed or was under-assessed. - **Basis for Action:** The ITO needs to have a valid reason to believe that income has escaped assessment. This belief must be based on tangible evidence or information that was not available at the time of the original assessment.
**2. **Section 148 - Notice for Reopening Assessment:** - **Issuance of Notice:** Section 148 requires the ITO to issue a notice to the assessee if they intend to reopen the assessment under Section 147. The notice must be issued before the expiration of the time limit prescribed for reopening assessments.
### **Additional Income and Fresh Notices**
**1. **Discovery of Additional Income:** - **During Reassessment Proceedings:** If during the proceedings, the ITO discovers additional income not previously identified, this income can be addressed under the reassessment process. However, if this additional income is significant and was not part of the original notice under Section 148, the ITO may be required to issue a fresh notice.
**2. **Need for Fresh Notice:** - **Section 148 Notice:** To reassess additional income discovered after the issuance of the initial notice under Section 148, a fresh notice under Section 148 is generally required. This ensures that the assessee is informed of the additional income and has an opportunity to respond.
### **Filing Return of Income (ROI) Under Section 148**
**1. **Filing ROI:** - **Mandatory Requirement:** Once a notice under Section 148 is issued, it is mandatory for the assessee to file a return of income (ROI) for the relevant assessment year, even if a return was previously filed. The notice under Section 148 effectively nullifies the previous return for the purpose of the reassessment.
**2. **Effect of Filing Earlier ROI:** - **Relevance of Earlier ROI:** The earlier ROI is not considered for the purposes of the reassessment. The reassessment process starts afresh, and the assessee must file a new ROI in response to the notice issued under Section 148. This new return should include all income, including any additional income discovered during the reassessment process.
### **Key Points for Compliance:**
1. **Reason to Believe:** The ITO must have a reason to believe that income has escaped assessment to initiate reassessment under Section 147. This belief should be based on new evidence or information.
2. **Issuance of Notice:** If new income or issues come to light during the reassessment process, the ITO generally needs to issue a fresh notice under Section 148 to inform the assessee and give them an opportunity to address the new issues.
3. **Filing ROI:** The assessee must file a new ROI in response to the notice under Section 148. The earlier filed ROI is not considered for the reassessment.
4. **Legal Precedents:** Courts have upheld the requirement for a fresh notice if significant new income is discovered. For instance, in **[CIT vs. M/s. S.K. Patel & Co.](https://www.indiankanoon.org/doc/1047736/)**, the necessity of issuing a fresh notice was emphasized if new information came to light.
### **Conclusion:**
If additional income is discovered during the reassessment proceedings under Section 147, a fresh notice under Section 148 is typically required to address this additional income. The assessee must file a new ROI in response to the notice, and the previous return is not considered for reassessment. This process ensures that all relevant income is assessed correctly and the assessee is given an opportunity to respond to any new findings.
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