Notice u/s 148

First of all, You need to see if the notice issued is time-barred or not.

For AY 2010-11, notice u/s 148 should have been despatched (not issued) by the department on or before 31.03.2017. If not, then this notice is not valid and the whole AY is time-barred.

You will be able to find the depatch date on the speed post envelope in which the notice was sent (Usually the notices are sent to your clients' addressses, so they will be having this envelope). Plz note that the 'date of notice' is NOT relevant to determine the validity.

If you find that the notice is VALID, then next step is to ask for reasons for issue of such notice. However, since your assessee is agreeing to the issue of notice, he should file a fresh Return of Income 'in Respone to notice u/s 148' disclosing the correct income for such AY.

The consequences can be Interest + Penalty at minimum of 100% which can go up to 300%, and is merely at the discretion of the AO.

Well.. No. DATE OF ISSUE = DATE OF DESPATCH (specified by Act)

Presently, the department still follows the practice of sending the Notices by speed post/ RPAD to the regd address of the assessee. 

You see, the date of issue of notice assumes relevance, ONLY IF, the assessee wants to fight the Reassessment proceedings. It is quite obvious that the date of email is going to be much earlier than the date of despatch. Hence, if date of email is taken as the date of issue,  you are only pushing the case in favour of the department, in which case, your assessee stand to lose.

We should always look for the Date of despatch, since the date of despatch is generally AFTER the date of email of notice. Then there is a high chance the notice would have been issued after AY had become time barred. 

Yes. I agree with Mr. RamaKrishnan. As he has rightly pointed out, as per the Bombay HC in Kross Television India Pvt Ltd vs. Vikhyat Chitra Production (Bombay High Court), notices can even be sent vide Whatsapp. But practically, such a mode of service is seldom resorted to, as it can be lead to unnecessary controversies later-on.

Regarding the service of s.148 notice by mail, my initial interpretation was that since the section 282 [Mode of Service] had been amended only w.e.f 01.04.2009, such amendment validating 'email notices' would apply only from AY 2011-12. However, a much proper interpretation would be that it being a procedural amendment, may apply even to AY 2010-11. If that being the case, I stand corrected to the extent that the date of email should be considered for determining the validity, even for AY 2010-11.

Another interesting fact is that, here at my place, section 148 notices are almost always sent by post. Maybe the dept does so to avoid unnecessary controversies. Some 2 years back, my principal had dealt with a case where speed post envelopes for s.148 notices had been misplaced by the assessee, and he filed a RTI with the postal authorities to dig out the depatch date.. following which it was discovered that the notice was invalid. The case was closed.

For now, sending of notices merely via email, is too big of a risk that the dept cannot afford to take. The sec.282 refers to Chptr IV of the Info Tech Act, for defining 'email' as a mode of service. If one were to refer Chptr IV (esp. s.13) of the Information Technology Act, there is enough room to stir up a controversy in interpreting the terminology 'Dispatch' and 'Receipt'. Hence, even today, in many IT jurisdictions, s.148 notices are not being sent via email.

Also, if one refers to NOTIFICATION NO.2/2016 [DGIT(S)/DIT(S)-3/AST/PAPERLESS ASSESSMENT PROCEEDINGS/96/2015-16],DATED 3-2-2016, one can conclude, that if the assessee does not receive the notice e-mail, due to his inbox being full, then the date of service via other modes should be seen. But still, I agree that Email IS A VALID MODE OF SERVICE.

Conclusion: Date of Issue of s.148 notice = Date of Despatch ---> Date on postal envelope or Date of email, whichever is earlier.