Income Tax Update: The income Tax Department is sending notice, know how and in how many days the reply will have to be given...
Income Tax Notice (IT Notice) takes away all good and bad. If you suddenly get an income tax notice one day, it can be a big headache for you. But there are many reasons behind issuing notices by the Income Tax Department. According to the report of our associate Times of India, under the guidelines of the department, it has been made mandatory to investigate the cases of those taxpayers who have not responded to the notices of the Income Tax Department.
When is the Income Tax notice issued?
Under Section 142 (1) of Income Tax, this notice is issued when the taxpayers have not filed the tax return. Or the notice is issued to obtain information related to any bank interest, long long-term capital gain/loss arising from the sale of any property. This is part of the guidelines recently issued by the Central Board of Direct Taxes (CBDT).
Why is an income tax notice issued?
Section 142(1) of the Income Tax Act empowers the Income Tax authorities to seek information by issuing a notice in the event of a return being filed. In cases where returns have not been filed, they are asked to furnish necessary information in the prescribed manner. Apart from this, it covers survey cases, search and seizure cases, tax evasion cases, and cases where no income tax return has been filed in response to the inquiry notice.
Are cases of non-registration or registration canceled also included?
Apart from this, cases related to non-registration and cancellation of registration under various sections are also included. For example, there are issues related to the registration of charitable organizations to be eligible for tax benefits. Additionally, if the taxpayers' income was increased in any previous year, the income tax return will be taken under mandatory scrutiny guidelines. The guidelines also stipulate the roles and responsibilities of Income Tax officials and the National Faceless Assessment Center (NFAC).
Is this a normal procedure?
Chartered accountants say that there has been no significant change in the criteria for compulsory scrutiny as compared to the current situation. The guidelines state that all income tax returns filed during FY24 will have the deadline for issuing notices till June 30, 2024. Compulsory scrutiny is a common process.
What is ascertained from the IT Notice?
In this, regular checks are done to find out whether the taxpayers have declared the income correctly in the income tax return. Apart from this, whether the outstanding tax has been paid or not.
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