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Income-tax Act, 1961 · Chapter XIV: Procedure for Assessment

Section 148: Issue of notice where income has escaped assessment

The Income-tax Act, 1961 was repealed by the Income-tax Act, 2025 from 1 April 2026. The text is kept here because the judgments below apply it.

In plain words

Before reopening an assessment under section 147, the Assessing Officer must serve a notice on the assessee asking for a return of income for that year. The officer must also record the reasons for issuing the notice.

  • The notice is the starting point of reassessment. Without a valid notice the reassessment cannot proceed.
  • The return filed in reply is treated like an ordinary return under the Act.
  • The officer must record reasons before issuing the notice, under sub-section (2).
  • Courts have held that the assessee can ask for these recorded reasons and object to them, and the officer must decide the objections by a separate order.
  • The provisos save certain notices tied to returns filed between 1st October 1991 and 30th September 2005.

A simplified explanation, prepared with AI assistance from the official text below and checked automatically against it for numbers and cross-references. The official text is the law and prevails over this summary. Not legal advice.

Read the in-depth explanation, with key Supreme Court rulings ↓

Official text

[(1)] Before making the assessment, reassessment or recomputation under section 147, the Assessing Officer shall serve on the assessee a notice requiring him to furnish within such period, *** as may be specified in the notice, a return of his income or the income of any other person in respect of which he is assessable under this Act during the previous year corresponding to the relevant assessment year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed; and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished undersection 139:] [Provided that in a case—

(a) where a return has been furnished during the period commencing on the 1st day of October, 1991 and ending on the 30th day of September, 2005 in response to a notice served under this section, and

(b) subsequently a notice has been served under sub-section (2) of section 143 after the expiry of twelve months specified in the proviso to sub-section (2) of section 143, as it stood immediately before the amendment of said sub-section by the Finance Act, 2002 (20 of 2002) but before the expiry of the time limit for making the assessment, re-assessment or recomputation as specified in sub-section (2) of section 153, every such notice referred to in this clause shall be deemed to be a valid notice:

Provided further that in a case—

(a) where a return has been furnished during the period commencing on the 1st day of October, 1991 and ending on the 30th day of September, 2005, in response to a notice served under this section, and

(b) subsequently a notice has been served under clause (ii) of sub-section (2) of section 143 after the expiry of twelve months specified in the proviso to clause (ii) of sub-section (2) of section 143, but before the expiry of the time limit for making the assessment, reassessment or recomputation as specified in sub-section (2) of section 153, every such notice referred to in this clause shall be deemed to be a valid notice.] [Explanation.—For the removal of doubts, it is hereby declared that nothing contained in the first proviso or the second proviso shall apply to any return which has been furnished on or after the 1st day of October, 2005 in response to a notice served under this section.] [(2) The Assessing Officer shall, before issuing any notice under this section, record his reasons for doing so.]

Source: India Code (Legislative Department), the text of the Act as it stood before its repeal. Words in square brackets [ ] were inserted or substituted by later amending Acts, and *** marks words omitted by an amendment. The amendment footnotes are not reproduced here. Official text on India Code.

Understanding this section

Section 148 requires the Assessing Officer, before reassessing under section 147, to serve a notice asking the assessee to file a return for the year, and to record the reasons for issuing it. A valid notice is the foundation of the reassessment.

The procedure for objections

The Supreme Court laid down a procedure that became standard. The assessee files a return in response to the notice and may ask for the recorded reasons. The officer must supply them within a reasonable time. The assessee may then object, and the officer must decide the objections by a speaking order before going ahead with the reassessment.

Only the reasons recorded can support the notice. The officer cannot later add new reasons to defend it.

After 2021

The Finance Act, 2021 introduced section 148A, which requires an inquiry, a show cause notice and an order before a notice under section 148 is issued. The text on this page is the earlier version.

Key Supreme Court rulings

  • GKN Driveshafts (India) Ltd. v. Income Tax Officer 2002 INSC 494

    On receiving a notice under section 148, the assessee should file a return and may seek the reasons; the officer must furnish them and dispose of any objections by a speaking order.

  • Union of India v. Ashish Agarwal 2022 INSC 510

    No notice under section 148 can be issued after 1 April 2021 without following the procedure in section 148A, and notices issued under the old law were treated as notices under section 148A.

Common mistakes

  • Rushing to a writ court against the notice without first seeking reasons and objecting.
  • Defending a notice on grounds not in the recorded reasons.

Read with: Section 147 Income-tax Act, 1961, Section 139 Income-tax Act, 1961

Prepared with AI assistance as a study aid. Every ruling listed was checked against the Supreme Court's own judgments on this site, and quoted words appear in those judgments; linked names open the full judgment. Read the judgments themselves before relying on them. Not legal advice.

Supreme Court judgments citing the section 148