140B, 144B, 148,148A,148B,149,149(1A)

Section 140B (Summary):

1. Applicable from 01st April 2022.

2. The budget proposes to allow a tax payer to file an updated return within two years from
the end of the relevant AY where any income has been under reported on payment of
additional tax at:
a. 25% of aggregate tax and interest, if the updated return is filed within 12 months.
b. 50% of aggregate tax and interest, if the updated return is filed beyond 12 months.
3. The updated return shall be accompanied by proof of payment of tax, additional tax, interest
and fees.
4. If any difficulty arises in giving effect to the provisions of this section, the board may, with
the approval of the Central Government, by notification in the Official Gazette, issue
guidelines for the purpose of removing the difficulty.
5. Every guideline issued under sub-section (5) shall be laid before each House of Parliament.

Section 144B (Summary) Faceless Assessment scheme:

1. The Central Government has undertaken a number of measures to make the processes
under the Act electronic, by eliminating person to person interface between the taxpayer
and the Department to the extent technologically feasible, and provide for optimal
utilisation of resources and a team-based assessment with dynamic jurisdiction. As part of
this policy, vide Taxation and Other Laws (Relaxation and Amendment of Certain Provisions)
Act, 2020, section 144B was inserted in the Act to provide the procedure for faceless
assessment with effect from 01.04.2021 and the Faceless Assessment Scheme, 2019 ceased
to operate from that date.

2. However, various difficulties are being faced by the administration and the taxpayers in the
operation of the faceless assessment procedure. In view of the above, it is proposed that the
existing provisions of the section 144B of the Act may be amended to streamline the process
of faceless assessment in order to address the various legal and procedural problems being
faced in the implementation of the said section.
3. The following are the key changes:
a. 15 days time limit to file a reply to initial notice has been changed to date specified
in the notice.
b. Power to initiate special audit u/s. 142(2A) has been granted.
c. Prior approval not required for personal hearing through video conferencing/video
telephony.
Rationalization of provisions relating to assessment and reassessment

The Finance Act, 2021 amended the procedure for assessment or reassessment of income in the Act
with effect from the 1st April, 2021. The said amendment modified, inter alia, sections 147, section
148, section 149 and also introduced a new section 148A in the Act. In cases where search is
initiated under section 132 of the Act or books of account, other documents or any assets are
requisitioned under section 132A of the Act, on or after 1st April, 2021, assessment or reassessment
is now made under sections 143 or 144 or 147 of the Act after the Finance Act, 2021

Section 148:

1. No prior approval of specified authority is required if the assessing officer with the prior
approval of specified authority has passed an order under section 148A(d) to the effect that
it is fit case to issue notice under this section.
2. Amendment in Explanation 1 to section 148:

Explanation 1 to section 148 prior to proposed Explanation 1 to section 148- amendment

amendment proposed
Explanation 1.—For the purposes of this section Explanation 1.—For the purposes of this section
and section 148A, the information with the and section 148A, the information with the
Assessing Officer which suggests that the Assessing Officer which suggests that the
income chargeable to tax has escaped income chargeable to tax has escaped
assessment means,— assessment means,—

(i) any information flagged in the case of the (i) any information in the case of the assessee
assessee for the relevant assessment year in for the relevant assessment year in accordance
accordance with the risk management strategy with the risk management strategy formulated
formulated by the Board from time to time; by the Board from time to time;

(ii) any final objection raised by the (ii) any audit objection to the effect that the
Comptroller and Auditor General of India to the assessment in the case of the assessee for the
effect that the assessment in the case of the relevant assessment year has not been made in
assessee for the relevant assessment year has accordance with the provisions of this Act; or
not been made in accordance with the
provisions of this Act. (iii) any information received under an
agreement referred to in section 90 or section
90A of the Act; or

(iv) any information made available to the

Assessing Officer under the scheme notified
under section 135A; or

(v) any information which requires action in

consequence of the order of a Tribunal or a
Court.”;
Section 148A:

Section 148A deals with conducting inquiry, providing opportunity before issue of notice u/s. 148.

1. Requirement of Approval of specified authority has been removed to provide an opportunity

of being heard to the assessee.
2. To provide that the provisions of the section 148A shall not apply in cases where the
Assessing Officer has received any information regarding the scheme notified under section
135A, pertaining to income chargeable to tax escaping assessment for any assessment year
in the case of the assessee. (Deemed to have escaped income therefore no inquiry before
issue of notice u/s. 148 )

Section 148B

1. a new section 148B to provide that no order of assessment or reassessment or

recomputation under the Act shall be passed by an Assessing Officer below the rank of Joint
Commissioner, except with the prior approval of the Additional Commissioner or Additional
Director or Joint Commissioner or Joint Director, in respect of assessments consequent to
search, survey and requisition to reduce avoidable inaccuracies.

Section 149

1. Section 149 deals with time limit for issue of notice u/s. 148.
2. 149(1)(b):

Section 149(1)(b) Before the proposed Section 149(1)(b) After the proposed
amendment amendment
if three years, but not more than ten if three years, but not more than ten years,
years, have elapsed from the end of the have elapsed from the end of the relevant
relevant assessment year unless the assessment year unless the Assessing Officer
Assessing Officer has in his possession has in his possession books of account or
books of account or other documents or other documents or evidence which reveal
evidence which reveal that the income that the income chargeable to tax,
chargeable to tax, represented in the form represented in the form of––
of asset, which has escaped assessment (i) An asset;
amounts to or is likely to amount to fifty (ii) expenditure in respect of a
lakh rupees or more for that year: transaction or in relation to an
event or occasion; or
(iii) an entry or entries in the books
of account,
which has escaped assessment amounts
to or is likely to amount to fifty lakh
rupees or more:”;
3. Provisio to section 149(1)

Provisio to section 149(1) before the Provisio to section 149(1) after the
proposed amendment proposed amendment

Provided that no notice under section 148 Provided that no notice under section 148
shall be issued at any time in a case for the shall be issued at any time in a case for the
relevant assessment year beginning on or relevant assessment year beginning on or
before 1st day of April, 2021, if such notice before 1st day of April, 2021, if a notice
could not have been issued at that time on under section 148 or section 153A or
account of being beyond the time limit section 153C could not have been issued at
specified under the provisions of clause (b) that time on account of being beyond the
of sub-section (1) of this section, as they time limit specified under the provisions of
stood immediately before the clause (b) of sub-section (1) of this section
commencement of the Finance Act, 2021: or section 153A or section 153C, as the case
may be, as they stood immediately before
the commencement of the Finance Act,
2021. (effective from 01 April 2021)

4. after sub-section (1), the following sub-section shall be inserted, namely:––

(1A) Notwithstanding anything contained in subsection (1), where the income chargeable to
tax represented in the form of an asset or expenditure in relation to an event or occasion of
the value referred to in clause (b) of sub-section (1), has escaped the assessment and the
investment in such asset or expenditure in relation to such event or occasion has been made
or incurred, in more than one previous years relevant to the assessment years within the
period referred to in clause (b) of subsection (1), a notice under section 148 shall be issued
for every such assessment year for assessment, reassessment or recomputation, as the case
may be.