Scope of proviso to Sec.143(2). - Income Tax - 1808/1989

INSTRUCTION NO. 1808/1989 Dated: March 8, 1989 Section 143 of the Income-tax Act has been substituted by the Direct Tax Laws (Amendment) Act, 1987 with effect from 1st April, 1989. Under the proviso to sub-section(2) of the said section, no notice can be served on an assessee after the expiry of the financial year in which return is furnished or the expiry of six months from the end of the month in which the return is furnished, whichever is later. 2. The effect of this proviso will be that in cases where a return of income has been filed before 1st October, 1988, no notice under section 143(2) of the Act can be served after 31st March, 1989. The Board, therefore, desire that Assessing Officers should ensure that notices under section 143(2) of the Act are served before 1st April, 1989 in all cases where returns have been furnished before 1s October, 1988, if assessments in such cases are proposed to be completed under section 143(3) of the Act. 3. It is also to be noted that in cases where returns are filed after 30th September, 1988, but before 1st April, 1989, a notice under section 143(2) of the Act will have to be served within six months of the end of the month in which the return is furnished. For instance, where a return of income is furnished in the month of October, 1988, the notice u/s 143(2) will have to be served before the end of the April, 1989, and where the return is furnished in November, 1988, the notice under section 143(2) will have to be served before the end of May, 1989 and so on. The Board, therefore, desired that Assessing Officers should ensure that notice under section 143(2) of the Act are served well within time in all such cases also. 4. It may be noted that, under the aforesaid provision, it is essential that a notice under section 143(2) of the Act is served on the assessee within the statutory time limit, and mere issue of the notice within the statutory period will not suffice. 5. These instructions will apply, mutatis mutandis, for purposes of assessments under the Gift-tax Act and the Wealth-tax Act. 6. These instructions may be brought to the notice of all officers in your region for immediate action.