Income tax

Everything you need to know about income tax e-notices

Since the advent of technology, most communications from the Income Tax (IT) department to an assessee are delivered to their registered email address. The Delhi High Court at Venad Properties Pvt. ltd. v. Commissioner of Income Tax (2013) 212 Taxman 20, held that the object and purpose of the notice is to inform and inform the recipient of the proceedings and the hearing date . If notice is served or received by the relevant party and this is established, the manner or mode of service is irrelevant.

Ignoring a notice (departmental emails and registered mail) can be very costly, resulting in a penalty of Rs 10,000 for each defect. Failure to comply, depending on the facts or the severity of the case, may result in prosecution.

The most common reasons a taxpayer receives notices include late/non-filing of computer returns, intentionally misreporting long-term capital gains received on publicly traded stocks and other mutual funds. investment, non-disclosure of income and investments made in the name of the spouse, high rates -value of transactions and tax evasions from previous years.

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Over the past few years, the IT department under “Project Insight” has become tech-savvy, making extensive use of data analytics and artificial intelligence. It tracks most monetary and non-monetary transactions and uses it to cross-check when processing computer statements.

Notice Types

Notice issued for defective computer declaration: the assessment office may issue a notice under section 139(9) if, in its opinion, the declaration filed by the person assessed contains incorrect details. This is an opportunity for the assessee to correct errors, provide missing information, and complete the declaration in all respects within 15 days from the date of the notice or extended deadline.

Notice of preliminary investigation: the assessment officer may issue a notice under section 142(1)(i) to a person who has not filed a tax return before the end of the tax year. taxation concerned, obliging him to provide the tax return. This notice can only be issued after the expiration of the specified due dates.

Notice with notice: The assessment officer may issue a notice with notice under Section 143(1) stating that the filed return is considered a final assessment of that particular return or a refund of excess taxes after adjustment of tax assessments or request for additional tax, in case of short payment or omission of income from the scope of tax. However, the tax department can always send a notice to another section for additional information. This notification can be expected within 9 months of the fiscal year in which the statement is provided.

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Notice of Initiation of Review: This is a follow-up notice to the notification issued under Section 142(1). If the reviewing officer is not satisfied with the response provided, they may issue another notice under section 143(2) requesting a detailed review. In this case, he may demand that the appraised concerned appear in person at his office or produce supporting documents in support of his claims. This notice must be published no later than the expiry of the period of 3 months from the end of the financial year during which the declaration is provided.

Escaped Income Assessment: The assessment officer may issue a section 148 notice if they disagree with the previous assessment of the tax return where some income escaped assessment. assessment due. This implies a reopening of the closed Assessment. However, the assessor must have one or more valid reasons for reopening the file and must record the reasons for issuing the said opinion.

Additional Income Tax/Fine/Penalty: An assessment officer may issue a section 156 notice to collect the tax owing or the fine or penalty after the assessment is completed. The appraise is required to deposit the amount due within 30 days from the date of receipt of the notice. Unlike other cases, no such time limit has been prescribed here. If you received an email from IT, don’t panic and ignore it, patiently take a set of impressions and verify its authenticity on the IT department email portal (https://bit.ly/38szmN6 ), read it carefully and take corrective action first.

If the situation warrants it, do not hesitate to seek the advice of a tax specialist.

(The author is the founder and CEO of Shree Tax Chambers)

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