Assessment or Reassessment of Incomes escaping assessment - Section 147 - Income Tax - Ready Reckoner - Income Tax

Assessment or Reassessment of Incomes escaping assessment - Section 147 1. Where the assessing officer has reason to believe that any income chargeable to tax for any assessment year has escaped assessment, then he may subject to the provision of section 148 to section 153 : assess or reassess such income which has escaped assessment recomputed the loss or the depreciation allowance or any other allowance, Once an assessment has been reopened, any other income which has escaped assessment and which comes to the notice of the Assessing Officer subsequently in the course of the proceeding u/s 147 can also be included in the assessment . 2. For the purpose of Assessment u/s 143(3) or 147 no action shall be taken after the expiry of 4 year from the relevant assessment year unless assessee has been in default in filing of return u/s 139(1) or in response to notice u/s 142(1) or 148 to disclose fully and truly all material facts necessary for the assessment. 3 Period for assessment u/s 147 of 4 years from the end of relevant assessment years shall not be applicable for any assessee having any asset (including financial interest in any entity) outside India, i.e., in such a case income escaping assessment can be done for any AY. 4. Reassessment can be done for any income other than income involving matters which are the subject-matter of appeal, reference or revision. 5. Deemed case of escapement: [Amended by Finance Act, 2021] Where no return of income has been furnished by the assessee and no assessment has been made although: His total income; or The total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax; Where a return of income has been furnished by the assessee but no assessment (scrutiny/best judgment assessment) has been made and it is noticed by the Assessing Officer that the assessee: Has understated the income; or Has claimed excessive loss, deduction, allowance or relief in the return; Where the assessee has failed to furnish a report in respect of any international transaction u/s 92E. Where an assessment u/s 143(3) or 144 has been made but, Income has been under-assessed, or Income has been made subject of excessive relief under the Act, or Excessive loss, depreciation or any other allowance has been allowed to the assessee, or The income has been assessed at a lower rate. Where a return of income has not been furnished by assessee or a return of income has been furnished by him on the basis of information or document received from the prescribed IT Authority, u/s 133C(2), it is noticed by AO that the income of assessee exceeds maximum amount not chargeable to tax, or, as the case may be, the assessee has understated the income or has claimed excessive loss, deduction or relief in the return. Where a person is found to have any asset (including financial interest in any entity) located outside India. NOTES:- For making assessment u/s 147 , AO bound to serve notice u/s 148. Notice u/s 148 can be serve only after following procedure given u/s 148A . Notice u/s 148 will be served with order u/s 148A (exception in some cases) During the assessment u/s 147 , if AO finds some other income escaped for same AY the AO can assess or reassess such income also without issuing fresh notice u/s 148 without passing order u/s 148A .