50-58

[Issue of notice where income has escaped assessment. 59

148. (1) Before making the assessment, reassessment or recomputation under section 147, the
Assessing Officer shall, subject to the provisions of section 148A, issue a notice to the assessee, along
with a copy of the order passed under sub-section (3) of section 148A, requiring him to furnish, within
such period as may be specified in the notice, not exceeding three months from the end of the month in
which such notice is issued, a return of his income or income of any other person in respect of whom he
is assessable under this Act during the previous year corresponding to the relevant assessment year:
Provided that no notice under this section shall be issued unless there is information with the
Assessing Officer which suggests that the income chargeable to tax has escaped assessment in the case
of the assessee for the relevant assessment year:
Provided further that where the Assessing Officer has received information under the scheme notified
under section 135A, no notice under this section shall be issued without prior approval of the specified
authority.
(2) The return of income required under sub-section (1) shall be furnished in such form and verified in
such manner and setting forth such other particulars, as may be prescribed, and the provisions of this
Act shall, apply accordingly as if such return were a return required to be furnished under section 139:
Provided that any return of income required under sub-section (1), furnished after the expiry of the
period specified in the notice under the said sub-section, shall not be deemed to be a return under
section 139.
(3) any information in the case of the assessee for the relevant assessment year in
For accordance with the risk management strategy formulated by the Board from time to
the time; or
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60
(i)
(ii) any audit objection to the effect that the assessment in the case of the assessee for
the relevant assessment year has not been made in accordance with the provisions of
 this Act; or
(iii) any information received under an agreement referred to in section 90 or section
90A of the Act; or
(iv) any information made available to the Assessing Officer under the scheme notified
under section 135A; or
(v) any information which requires action in consequence of the order of a Tribunal or a
Court; or
(vi) any information in the case of the assessee emanating from survey conducted under
section 133A, other than under sub-section (2A) of the said section, on or after the
1st day of September, 2024.

50-58 . Sections 148 and 148A substituted by the Finance (No. 2) Act, 2024, w.e.f. 1-9-2024.
Prior to their substitution, section 148, as amended by the Direct Tax Laws (Amendment)
Act, 1987, w.e.f. 1-4-1989, Direct Tax Laws (Amendment) Act, 1989, w.e.f. 1-4-1989,
Finance (No. 2) Act, 1996, w.r.e.f. 1-4-1989, Finance Act, 2006, w.r.e.f. 1-10-1991/w.r.e.f.
1-10-2005, Finance Act, 2022, w.e.f. 1-4-2022/w.r.e.f. 1-4-2021 and Finance Act, 2023,
w.e.f. 1-4-2023 and section 148A, as inserted by the Finance Act, 2021, w.e.f. 1-4-2021
and amended by the Finance Act, 2022, w.e.f. 1-4-2022 read as under:
"148. Issue of notice where income has escaped assessment. — Before making the assessment,
reassessment or recomputation under section 147, and subject to the provisions of section 148A, the
Assessing Officer shall serve on the assessee a notice, along with a copy of the order passed, if
required, under clause (d) of section 148A, requiring him to furnish within a period of three months
from the end of the month in which such notice is issued, or such further period as may be allowed
by the Assessing Officer on the basis of an application made in this regard by the assessee, a return
of his income or the income of any other person in respect of which he is assessable under this Act
during the previous year corresponding to the relevant assessment year, in the prescribed form and
verified in the prescribed manner and setting forth such other particulars as may be prescribed; and
the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return
required to be furnished under section 139:
Provided that no notice under this section shall be issued unless there is information with the
Assessing Officer which suggests that the income chargeable to tax has escaped assessment in the
case of the assessee for the relevant assessment year and the Assessing Officer has obtained prior
approval of the specified authority to issue such notice:
Provided further that no such approval shall be required where the Assessing Officer, with the
prior approval of the specified authority, has passed an order under clause (d) of section 148A to the
effect that it is a fit case to issue a notice under this section:
Provided also that any return of income, required to be furnished by an assessee under this section
and furnished beyond the period allowed shall not be deemed to be a return under section 139.
Explanation 1.—For the purposes of this section and section 148A, the information with the
Assessing Officer which suggests that the income chargeable to tax has escaped assessment means,
—
(i) any information in the case of the assessee for the relevant assessment year in
accordance with the risk management strategy formulated by the Board from time to
time;
(ii) any audit objection to the effect that the assessment in the case of the assessee for the
relevant assessment year has not been made in accordance with the provisions of this
 Act; or
(iii) any information received under an agreement referred to in section 90 or section 90A
of the Act; or
(iv) any information made available to the Assessing Officer under the scheme notified
under section 135A; or
(v) any information which requires action in consequence of the order of a Tribunal or a
Court.
Explanation 2.—For the purposes of this section, where,—
(i) a search is initiated under section 132 or books of account, other documents or any
assets are requisitioned under section 132A, on or after the 1st day of April, 2021, in
the case of the assessee; or
(ii) a survey is conducted under section 133A, other than under sub-section (2A) of that
section, on or after the 1st day of April, 2021, in the case of the assessee; or
(iii) the Assessing Officer is satisfied, with the prior approval of the Principal
Commissioner or Commissioner, that any money, bullion, jewellery or other valuable
article or thing, seized or requisitioned under section 132 or section 132A in case of
any other person on or after the 1st day of April, 2021, belongs to the assessee; or
(iv) the Assessing Officer is satisfied, with the prior approval of Principal Commissioner
or Commissioner, that any books of account or documents, seized or requisitioned
under section 132 or section 132A in case of any other person on or after the 1st day
of April, 2021, pertains or pertain to, or any information contained therein, relate to,
the assessee,
the Assessing Officer shall be deemed to have information which suggests that the income
chargeable to tax has escaped assessment in the case of the assessee where the search is initiated or
books of account, other documents or any assets are requisitioned or survey is conducted in the case
of the assessee or money, bullion, jewellery or other valuable article or thing or books of account or
documents are seized or requisitioned in case of any other person.
Explanation 3.—For the purposes of this section, specified authority means the specified authority
referred to in section 151.
148A. Conducting inquiry, providing opportunity before issue of notice under section 148.— The
Assessing Officer shall, before issuing any notice under section 148,—
(a) conduct any enquiry, if required, with the prior approval of specified authority, with
respect to the information which suggests that the income chargeable to tax has
escaped assessment;
(b) provide an opportunity of being heard to the assessee, by serving upon him a notice
to show cause within such time, as may be specified in the notice, being not less than
seven days and but not exceeding thirty days from the date on which such notice is
issued, or such time, as may be extended by him on the basis of an application in this
behalf, as to why a notice under section 148 should not be issued on the basis of
information which suggests that income chargeable to tax has escaped assessment in
his case for the relevant assessment year and results of enquiry conducted, if any, as
per clause (a);
(c) consider the reply of assessee furnished, if any, in response to the show-cause notice
referred to in clause (b);
(d) decide, on the basis of material available on record including reply of the assessee,
whether or not it is a fit case to issue a notice under section 148, by passing an order,
 with the prior approval of specified authority, within one month from the end of the
month in which the reply referred to in clause (c) is received by him, or where no
such reply is furnished, within one month from the end of the month in which time
or extended time allowed to furnish a reply as per clause (b) expires:
Provided that the provisions of this section shall not apply in a case where,—
(a) a search is initiated under section 132 or books of account, other documents or any
assets are requisitioned under section 132A in the case of the assessee on or after the
1st day of April, 2021; or
(b) the Assessing Officer is satisfied, with the prior approval of the Principal
Commissioner or Commissioner that any money, bullion, jewellery or other valuable
article or thing, seized in a search under section 132 or requisitioned under section
132A, in the case of any other person on or after the 1st day of April, 2021, belongs
to the assessee; or
(c) the Assessing Officer is satisfied, with the prior approval of the Principal
Commissioner or Commissioner that any books of account or documents, seized in a
search under section 132 or requisitioned under section 132A, in case of any other
person on or after the 1st day of April, 2021, pertains or pertain to, or any
information contained therein, relate to, the assessee; or
(d) the Assessing Officer has received any information under the scheme notified under
section 135A pertaining to income chargeable to tax escaping assessment for any
assessment year in the case of the assessee.
Explanation.—For the purposes of this section, specified authority means the specified authority
referred to in section 151."
59. See Order F.No. 225/40/2021/ITA-II, dated 4-3-2021, Instruction F.No. 225/40/2021-ITA-
II, dated 12-3-2021, Instruction F.No. 225/40/2021-ITA-II, dated 26-3-2021, Instruction
F.No. 225/40/2021-ITA-II, dated 27-3-2021 (Instructions regarding selection of cases for
issue of notice u/s 148) and Instruction F.No. 225/40/2021-ITA-II, dated 15-3-2021
(Instructions regarding selection of 'Potential cases' for issue of notice under section 148
and rationalisation of workload in International Taxation Charges). For details, see
Taxmann's Master Guide to Income-tax Act.
60. For the meaning of the term "information", see Taxmann's Direct Taxes Manual, Vol. 3.