Finance Bill, 2023Reassessment Time to File Return Under Section 148 Qua Finance Bill, 2023

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The Tax Publishers Finance Bill, 2023--Reassessment Time to File Return Under Section 148 Qua Finance Bill, 2023 Sameer Bhatia The Finance Bill, 2023 proposes to significantly amend the provisions pertaining to Section 148 by amending the time stipulated to file return of income with the department. The learned author in his piece validly encapsulates and endorses the view that the amendment to the provision now would at the most invalidate the return belatedly filed in response to notice issued under Section 148. The above said act would also frustrate the very engagement of the department to issue statutory notice under Section 143(2) thereby casting thumping obligation on the part of the assessee to be more vigilant in his endeavour while participating in the proceedings at the outset. Since the provisions applicable to a return filed in consequence of proceedings under Section 139 no longer hold the field, filing of return within the time allowed in response to a notice under Section 148 would ease the burden of compliance rather than to hinder the very prospect of contesting the matter with great zeal by the assessee. 1. Introduction Section 148 of the Income Tax Act, 1961 is perhaps one of the most litigated provisions, under the Income Tax Act, 1961 which went through complete overhauling vide Finance Act, 2021. Reopening of concluded assessments no doubt possess the legislative stamp however it does impact the very foundation of the assessment completed by the officers concerned, now under the faceless regime of assessment. The authenticity, veracity, in-depth analysis of the information before the assessing authority at the time of assessment incorporates the exercise of due diligence in the entire decision making process. The said action on the part of the assessing authority when called in question via reopening route do cast roving eye of suspicion as to the previous decision making process when viewed from assessee's point of view. The Finance Bill 2023 has once again tinkered with the provision of Section 148 by introducing time-lines to file return in response to notice issued under the relevant provision when succeeded by the provision of Section 148A. 2. Time-line to file return in response to notice under Section 148 The Finance Bill 2023 proposes a significant change to the time prescribed for filing return in response to a notice issued under Section 148 of the Income Tax Act, 1961. The said move however at the same time topples the spirit of existing judicial precedents available on the subject which extended jurisdictional favours to the assessees concerned while banking upon the legality of the fashion in which assessment/re-assessment has been concluded under the legal provision. Section 148 as it stands on the statute substituted by the Finance Act, 2021 with effect from 01-4-2021 provides that 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 such period, as may be specified in such notice, a return of his income or the income of any other person in respect of which is assessable under the act. It further provides that such return which is filed in due consequence of notice under Section 148 shall be understood to be a return under Section 139 and all consequences applicable to a return filed thereto will apply accordingly. SUBSCRIBE FOR FULL CONTENT

The Tax Publishers

Finance Bill, 2023--Reassessment

Time to File Return Under Section 148 Qua Finance Bill, 2023

Sameer Bhatia

The Finance Bill, 2023 proposes to significantly amend the provisions pertaining to Section 148 by amending the time stipulated to file return of income with the department. The learned author in his piece validly encapsulates and endorses the view that the amendment to the provision now would at the most invalidate the return belatedly filed in response to notice issued under Section 148. The above said act would also frustrate the very engagement of the department to issue statutory notice under Section 143(2) thereby casting thumping obligation on the part of the assessee to be more vigilant in his endeavour while participating in the proceedings at the outset. Since the provisions applicable to a return filed in consequence of proceedings under Section 139 no longer hold the field, filing of return within the time allowed in response to a notice under Section 148 would ease the burden of compliance rather than to hinder the very prospect of contesting the matter with great zeal by the assessee.

1. Introduction

Section 148 of the Income Tax Act, 1961 is perhaps one of the most litigated provisions, under the Income Tax Act, 1961 which went through complete overhauling vide Finance Act, 2021. Reopening of concluded assessments no doubt possess the legislative stamp however it does impact the very foundation of the assessment completed by the officers concerned, now under the faceless regime of assessment. The authenticity, veracity, in-depth analysis of the information before the assessing authority at the time of assessment incorporates the exercise of due diligence in the entire decision making process. The said action on the part of the assessing authority when called in question via reopening route do cast roving eye of suspicion as to the previous decision making process when viewed from assessee's point of view. The Finance Bill 2023 has once again tinkered with the provision of Section 148 by introducing time-lines to file return in response to notice issued under the relevant provision when succeeded by the provision of Section 148A.

2. Time-line to file return in response to notice under Section 148

The Finance Bill 2023 proposes a significant change to the time prescribed for filing return in response to a notice issued under Section 148 of the Income Tax Act, 1961. The said move however at the same time topples the spirit of existing judicial precedents available on the subject which extended jurisdictional favours to the assessees concerned while banking upon the legality of the fashion in which assessment/re-assessment has been concluded under the legal provision. Section 148 as it stands on the statute substituted by the Finance Act, 2021 with effect from 01-4-2021 provides that 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 such period, as may be specified in such notice, a return of his income or the income of any other person in respect of which is assessable under the act. It further provides that such return which is filed in due consequence of notice under Section 148 shall be understood to be a return under Section 139 and all consequences applicable to a return filed thereto will apply accordingly.