Notice u/s 143(3) read with sec 147

One of my client got assessment order under section 143(3) RW sec 147 for not showing one bank account while filing return of income for A.Y.2006-07. Fact of case was as under:

Assessee is having a saving account in a co op bank which was not shown in ITR. AO got information from AIR submitted by bank that assessee has deposited Rs.16 Lacs in that account.

Order has been passed and demand raised for Rs.10Lac.

What are the stand and case laws we can use to lower this demand ?!

Replies (11)

sir 

ist of all plz check that your client has been show this income in irt or not after that we will discussed 

The purpose of scrutiny assessement u/s 143(3) is to find out whether the assessee has not

1) understated the incom

2) computed excessive loss

3) underpaid tax in any manner.

The AO may conduct enquiries to seek information from other sources. Now the assessee will have to reply to the notice stating the facts regarding the credit of 16 lacs in the saving account. If it turns out that it is an income, then tax shall be payable thereon along with the interest.

 

Originally posted by : Mihir
The purpose of scrutiny assessement u/s 143(3) is to find out whether the assessee has not

1) understated the incom

2) computed excessive loss

3) underpaid tax in any manner.

The AO may conduct enquiries to seek information from other sources. Now the assessee will have to reply to the notice stating the facts regarding the credit of 16 lacs in the saving account. If it turns out that it is an income, then tax shall be payable thereon along with the interest.

 

totally agreed...

Whether the notice itself is valid because it could be issued only before 31.03.2013(6yrs from end of relevant AY).Correct me if i am wrong.

Mr Roshan A is correct
First of all must cheak the validity of notice

gift received at marriage is tax free....but what treatment the donor shows the paid gift?.......

.is he can claim the paid gift.......?

plz reply its urgnt...

Assessment has been done and order has also been severed upon assessee considering the deposit of Rs.16 lac as income as client has not taken care to reply to the notices nor informed us about such notice. Now demad notice has been issued Rs.10 Lac.

 

Notice is valid

The AO may condone the delay in replying to the notice if a bona fide reason is given. If the credit of 16 lacs is not his income or only partly his income, the assessee may go for CIT(appeal), and try to at least reduce the tax. Depending on the nature of this credit, the AO may try to open previous years assessement also, so the assessee will have to come out clean before the CA.

Once the assessment/reassessment is complete, then demand can be reduced by way of appeal before the CIT(A) or 264 petition. 

Once the assessment/reassessment is complete, then demand can be reduced by way of appeal before the CIT(A) or 264 petition before concerned CIT.

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