Section 149 of ITA, 1961 : Section 149: Time Limit For Notice

Explanation using Example

Let's say Mr. Sharma filed his income tax return for the assessment year 2015-2016. The Income Tax Department later receives information that suggests Mr. Sharma might have underreported his income for that year. According to Section 149 of the Income-tax Act, 1961:

• If the current year is 2021, and it's been more than four years but less than six years since the end of the assessment year 2015-2016, the Income Tax Department can issue a notice to Mr. Sharma under section 148 to reassess his income, but only if they suspect that the income that has escaped assessment is one lakh rupees or more.
• If Mr. Sharma had assets outside India in that year, the department can issue the notice for reassessment up to sixteen years from the end of the assessment year 2015-2016, should they find that income from those foreign assets has escaped assessment.
• However, if Mr. Sharma is acting as an agent for a non-resident, the notice under section 148 can only be issued within six years from the end of the assessment year 2015-2016.

It is important to note that these actions would be subject to the provisions of section 151, which requires the approval of specified authorities before such a notice is issued.