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Income Tax Notice Section 148A Income Tax Act 1961 Complete Guide

CA Satbir Singh — Sun, 26 Apr 2026 11:53:12 +0000

Income Tax Notice Section 148A Income Tax Act 1961 Complete Guide

Income Tax act 1961 is replaced by Income tax act 2025 effective from 1st April 2026.

For which tax years will the reassessment provisions of the new Act 2025 apply?
Ans. The reassessment provisions of the Income-tax Act, 2025 (Sections 279–286) will apply to Tax Year 2026-27 and subsequent tax years. For any tax year beginning before 1st April, 2026, only the old Act provisions (Income Tax Act 1961) will apply for reassessment.

Therefore all the Income tax Notice for theAssessment year upto AY 2026-27 will come under Income Tax Act 1961 even after Income Tax Act 2025 is effective from 1st April 2026. For example AY 2023-24 Income Tax notice issued on 24.4.2026 will be as per Income Tax Act 1961. Here is the complete analaysis of Income Tax Notice Section148A Income Tax Act 1961

Format of Notice Issued u/s 148A of Income tax act 1961

It starts with heading ” Notice under sub-section (1)of section 148A of the Income-tax Act, 1961 ”

Section 148A of the Income Tax act 1961 as amended upto Finance Act 2026

Section 148A as substituted by the Finance (No. 2) Act, 2024, with effect from 01-09-2024, reads as follows:

“Procedure before issuance of notice under Section 148.

148A. (1) Where the Assessing Officer has information which suggests that income chargeable to tax has escaped assessment in the case of an assessee for the relevant assessment year, he shall, before issuing any notice under section 148 provide an opportunity of being heard to such assessee by serving upon him a notice to show cause as to why a notice under section 148 should not be issued in his case and such notice to show cause shall be accompanied by the information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year.

(2) On receipt of the notice under sub-section (1), the assessee may furnish his reply within such period, as may be specified in the notice.

(3) The Assessing Officer shall, on the basis of material available on record and taking into account the reply of the assessee furnished under sub-section (2), if any, pass an order with the prior approval of the specified authority determining whether or not it is a fit case to issue notice under section 148.

(4) The provisions of this section shall not apply to income chargeable to tax escaping assessment for any assessment year in the case of an assessee where the Assessing Officer has received information under the scheme notified under section 135A.

Explanation.—For the purposes of this section and section 148, “specified authority” means the specified authority referred to in section 151.”

Analysis of Income Tax Notice Section148A Income Tax Act

Time Limit to Issue Notice u/s 148A of Income Tax act

The Finance (No. 2) Act, 2024 significantly reduced the time limits for reopening tax assessments to provide greater certainty to taxpayers. These changes, effective from September 1, 2024, distinguish between the time allowed to issue a preliminary Show Cause Notice (Section 148A) and the formal reassessment notice (Section 148).

Reassessment Time Limits (Post-Sept 1, 2024)

Case Category	Escaped Income Amount	Section 148A Notice (Show Cause)	Section 148 Notice (Formal Reassessment)
Normal Cases	Less than ₹50 Lakhs	Up to 3 years	Up to 3 years and 3 months
Specific Cases	₹50 Lakhs or More	Up to 5 years	Up to 5 years and 3 months

All limits are calculated from the end of the relevant Assessment Year (AY).

Key Updates and Clarifications on Time Limit for Notice u/s 148A of Income Tax act

Reduced Maximum Window: The maximum period for reopening cases has been slashed from 10 years to 5 years and 3 months.
Standardized Approvals: The “Specified Authority” required to approve these notices has been simplified. Approval from an Additional/Joint Commissioner or Director is now generally sufficient across both time categories.
Transitional Rules: For older years like AY 2018-19, if a notice was not issued by August 31, 2024, it may now be permanently time-barred under these new, shorter limits.
Buffer Period: The additional 3 months provided for the Section 148 notice is a buffer to allow the department to complete the mandatory 148A “opportunity of being heard” process (inquiry, response, and order) before the final deadline.

Opportunity of being heard to the assessee

Notice under Section 148A(1): The process now begins directly with the issuance of a notice. The Assessing Officer (AO) must serve a “Show Cause Notice” to the assessee, providing an opportunity to be heard before issuing a formal notice under Section 148.

No Prior Inquiry: The previous requirement (under old Clause ‘a’) for the AO to conduct a preliminary inquiry before issuing the show cause notice has been removed.
Mandatory Disclosure: The notice must be accompanied by the specific “information” which suggests that income has escaped assessment. This ensures the assessee knows exactly what evidence is being used against them.
Time to Respond: The rigid statutory timeframe (previously 7 to 30 days) has been removed. The assessee must now reply “within such period, as may be specified in the notice” by the AO.

Basis for the issue of notice:

The notice under Section 148A(1) is issued solely on the basis of “information” suggesting that income chargeable to tax has escaped assessment.

Sources of Information: While defined in Section 148 (Explanation 1), these sources form the basis for 148A. They include:

(i) Risk Management Strategy,

(ii) Audit Objections,

(iii) Information from Foreign Jurisdictions (Treaties),

(iv) Court/Tribunal Orders, and (v) Information from the Scheme under Section 135A.

New Addition: “Information” now also explicitly includes information emanating from a survey conducted under Section 133A on or after September 1, 2024.

AO has to Consider a reply under Section 148A(2):

Upon receipt of the notice, the assessee may furnish a reply within the time specified in the notice. The AO is legally bound to consider this reply and the material on record before making a final decision. This stage retains the core principle of natural justice, allowing the taxpayer to refute the information or clarify the transaction before a formal reopening occurs.

AO has to pass an order under Section 148A(3):

After considering the material on record and the assessee’s reply (if any), the AO must pass an order determining whether or not it is a “fit case” to issue a notice under Section 148.

Prior Approval: The AO must obtain prior approval from the “Specified Authority” before passing this order.
Change in Authority: The “Specified Authority” for granting approval (under Section 151) has been decentralized. It is now the Additional Commissioner, Additional Director, Joint Commissioner, or Joint Director, replacing the higher-ranking Principal Chief Commissioner ,Principal Directors, or Principal Commissioner,Director General required under the old regime for cases beyond three years.
Timeline: The specific statutory deadline (previously “one month” from the end of the month of reply) has been removed from the text of Section 148A itself, though general limitation periods under Section 149 still govern the overall issuance of the Section 148 notice.

Exceptions i.e when Notice u/s Section 148A is not required to be issued

Exceptions (Section 148A(4)): The procedure under Section 148A (Show Cause Notice and Order) is not required if the information suggesting escaped income is received under the scheme notified under Section 135A (Faceless Collection of Information). In such cases, the AO can proceed directly to Section 148.

Notice under Section 148 will be issued along with the order under Section 148A.

If the officer think fit case to open the assesssment then Notice under Section 148 will be issued along with the order under Section 148A.

Based on the Finance (No. 2) Act, 2024 updates, here is the refined analysis of the timelines and procedural requirements for issuing a notice under Section 148:

1. Revised Limitation Periods

The time limits for the Income Tax Department to issue a formal reassessment notice under Section 148 have been shortened to provide more certainty to taxpayers:

Standard Cases: The notice can be issued within three years and three months from the end of the relevant assessment year (AY).
High-Value Cases: The notice can be issued within five years and three months from the end of the relevant AY, provided the escaped income is ₹50 lakh or more. This must be supported by information regarding:
- Undisclosed assets.
- Undisclosed expenditure.
- Specific entries in the books of account or other documents.

2. Compliance with Section 139

When a taxpayer is served a notice under Section 148, they are required to furnish a return of income. This return must be prepared and filed in the same manner as a regular tax return under Section 139. All standard requirements—such as the use of prescribed forms, verification, and disclosure of details—apply.

3. Strict Filing Deadlines (Non-Est Returns)

The law now strictly enforces the timeline specified in the Section 148 notice:

Timely Filing: The return must be filed within the specific period mentioned in the notice (or as extended by the Assessing Officer).
Consequence of Delay: If a return is furnished after the expiry of the allowed time, it will be treated as non-est (as if it never existed).
Impact: A “non-est” return means the Assessing Officer can ignore your filing entirely and proceed to complete the assessment based on “best judgment” (Section 144), which often leads to higher tax liabilities and penalties.

4. Summary Table of Timelines

Escaped Income Criteria	Section 148A (Show Cause)	Section 148 (Final Notice)
Less than ₹50 Lakhs	Up to 3 Years	3 Years & 3 Months
₹50 Lakhs or More	Up to 5 Years	5 Years & 3 Months
Note: Timelines are measured from the end of the relevant Assessment Year.

Section 148A Income Tax Act 1961 Procedure before issuance of notice under section 148.

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Section 148A Income Tax Act 1961 Procedure before issuance of notice under section 148.

CA Satbir Singh — Thu, 02 Mar 2023 04:55:59 +0000

Section 148A Income Tax Act Procedure before issuance of notice under section 148.

Section 148A Income Tax Act of India is for conducting Inquiry, providing opportunity before issue of notice u/s 148

CA satbir Singh (Contact us Taxheal@gmail.com )

For Section 148A of the Income-tax Act, the following sections shall be substituted with effect from the 1st day of September, 2024, namely

Procedure before issuance of notice under section 148.

148A. (1) Where the Assessing Officer has information which suggests that income chargeable to tax has escaped assessment in the case of an assessee for the relevant assessment year, he shall, before issuing any notice under section 148 provide an opportunity of being heard to such assessee by serving upon him a notice to show cause as to why a notice under section 148 should not be issued in his case and such notice to show cause shall be accompanied by the information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year.

(2) On receipt of the notice under sub-section (1), the assessee may furnish his reply within such period, as may be specified in the notice.

Explanation.-For the purposes of this section and section 148, “specified authority” means the specified authority referred to in section 151.]

Summary of Old Section 148A Income Tax Act

Section 148A Income Tax Act Inserted by the Finance Act, 2021, w.e.f. 1-4-2021.
Words “with the prior approval of specified authority, in Section 148A (2) ” omitted by the Finance Act, 2022, w.e.f. 1-4-2022.
Follwing words Substituted for “relate to, the assessee.” by the Finance Act, 2022, w.e.f. 1-4-2022 in Clause (c) of First proviso to section 148A Income Tax
- ” 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.

Video Explanation of Section 148A Income Tax Act Conducting Inquiry

Section 148A Income Tax Act Conducting Inquiry, providing opportunity before issue of notice u/s 148

Conducting inquiry, providing opportunity before issue of notice under section 148.

148A. 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, 1[***] 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, 2 [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.]

1. Words “with the prior approval of specified authority,” omitted by the Finance Act, 2022, w.e.f. 1-4-2022.

2 Substituted for “relate to, the assessee.” by the Finance Act, 2022, w.e.f. 1-4-2022.

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