Notice u/s 148

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 May 2015 I have two queries:

1. If the case was already selected for scrutity assessment for a.y.2010-11 u/s 143(2) then whether again notice u/s 148 can be issued for the same a.y.

2. The assessee has recd. notice u/s 148 with the reason that particular expenses claimed in a.y.2010-11 was disallowable.
So whether the A.O. can called for detailed information on all the income and expenditure ?

Please guide me i.r.o. both the queries.

Thanks in Advance

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 May 2015 to both the queries the answer is yes.

Querist : Anonymous

Querist : Anonymous (Querist)

15 May 2015 But sir I have heard somewhere that AO cannot ask for detailed inquiry other than for the point due to which case was selected for scrutiny under cess

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Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 May 2015 have heard where??????????

Querist : Anonymous

Querist : Anonymous (Querist)

15 May 2015 The CBDT has issued Instruction No. 7 of 2014 dated 26.09.2014 pointing out that in cases selected for scrutiny under Computer Aided Scrutiny Selection (‘CASS’), some AOs routinely call for information which is not relevant for enquiry into the issues to be considered. This has been causing undue harassment to the taxpayers and has also drawn adverse criticism from several quarters. The CBDT has directed that cases selected for scrutiny during the Financial Year 2014-2015 under CASS, on the basis of either AIR data or CIB information or for non- reconciliation with 26AS data the scope of enquiry should be limited to verification of these particular aspects only. The Assessing Officer shall confine the questionnaire and subsequent enquiry or verification only to the specific point(s) on the basis of which the particular return has been selected for scrutiny.

SO if Notice u/s 148 is issued on the basis of one particular disallowable expenditure, then Can AO ask for detailed inquiry in books of accounts.?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 May 2015 are these two linked?? though I agree that under 148, the inquiry needs to be restricted to issue on which notice is issued. but your reference circular is for 143 assessments

CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)
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15 May 2015 Even for section 148, the AO need not restrict himself to issue on which notice u/s 148 was issued. He may assess or reassess the income which may come to his notice subsequently in proceedings u/s 148 notwithstanding the reasons for such issue has not been included in the reasons recorded under sub section (2) of section 148. [refer explanation 3 to section 148]

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 May 2015 abhishek which explanation are you referring to? there is only on explanation to section 148.

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Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 May 2015 believe you are referring to section 147.

even that explanation wont mean that AO asks for all the income and expense items.

CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)
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18 May 2015 Yes I was referring to section 147 explanation 3. The explanation means that the AO need not restrict himself to issue which has been the subject matter of notice. He may examine any other income which may come to his notice subsequently. In one of our case notice u/s 148 was issued and a detailed query letter was issued in which details regarding bank accounts,household expenditure etc were asked on the same lines as in the case of section 143(3) scrutiny assessment.