Inquiry before assessment.
31142. (1) For
the purpose of making an assessment under this Act, the 32[Assessing] Officer may serve on any
person who has made a return 33[under
section 115WD or section
139 34[or in whose case the
time allowed under sub-section (1) of section 139]
for furnishing the return has expired] a notice requiring him, on a date to
be therein specified,—
35[(i) where such person has not made a return 36[within the time allowed under
sub-section (1) of section 139] 37[or before the end of the relevant
assessment year], to furnish a return of his income or the income of any other
person in respect of which he is assessable under this Act, in the prescribed
form and verified in the prescribed manner38
and setting forth such other particulars as may be prescribed, or :]
39[Provided that where any notice
has been served under this sub-section for the purposes of this clause after
the end of the relevant assessment year commencing on or after the 1st day of
April, 1990 to a person who has not made a return within the time allowed under
sub-section (1) of section 139 or before the end
of the relevant assessment year, any such notice issued to him shall be deemed
to have been served in accordance with the provisions of this sub-section,]
40[(ii)] to produce, or cause to be produced, such
accounts or documents as the 41[Assessing]
Officer may require, or
42[(iii)] 43to
furnish in writing and verified in the prescribed manner information in such
form and on such points or matters (including a statement of all assets and
liabilities of the assessee, whether included in the accounts or not) as the 44[Assessing] Officer may require :
Provided that—
(a) the previous approval of the 45[Joint Commissioner] shall be obtained
before requiring the assessee to furnish a statement of all assets and
liabilities not included in the accounts ;
(b) the 46[Assessing]
Officer shall not require the production of any accounts relating to a period
more than three years prior to the previous year.
(2) For
the purpose of obtaining full information in respect of the income or loss of
any person, the 46[Assessing]
Officer may make such inquiry as he considers necessary.
47[(2A) 48If, at any stage of the proceedings
before him, the 49[Assessing]
Officer, having regard to the nature and complexity50 of the 50accounts of the assessee and the
interests of the revenue, is of the opinion that it is necessary so to do, he
may, with the previous approval of the 51[Chief
Commissioner or Commissioner], direct the assessee to get the accounts audited
by an accountant, as defined in the Explanation below
sub-section (2) of section 288, nominated by the 51[Chief Commissioner or Commissioner] in
this behalf and to furnish a report of such audit in the prescribed form52 duly signed and verified by such
accountant and setting forth such particulars as may be prescribed and such
other particulars as the 53[Assessing]
Officer may require :
54[Provided
that the Assessing Officer shall not direct the assessee to get the
accounts so audited unless the assessee has been given a reasonable opportunity
of being heard.]
(2B) The
provisions of sub-section (2A) shall have effect notwithstanding that the
accounts of the assessee have been audited under any other law for the time
being in force or otherwise.
(2C)
Every report under sub-section (2A) shall be furnished by the assessee to the 55[Assessing] Officer within such period
as may be specified by the 55[Assessing]
Officer :
Provided that
the 55[Assessing] Officer may, 56[suo motu, or] on
an application made in this behalf by the assessee and for any good and
sufficient reason, extend the said period by such further period or periods as
he thinks fit ; so, however, that the aggregate of the period originally fixed
and the period or periods so extended shall not, in any case, exceed one
hundred and eighty days from the date on which the direction under sub-section
(2A) is received by the assessee.
(2D) The
expenses of, and incidental to, any audit under sub-section (2A) (including the
remuneration of the accountant) shall be determined by the 57[Chief Commissioner or Commissioner] (which
determination shall be final) and paid by the assessee and in default of such
payment, shall be recoverable from the assessee in the manner provided in
Chapter XVII-D for the recovery of arrears of tax :]
58[Provided
that where any direction for audit under sub-section (2A) is issued by the
Assessing Officer on or after the 1st day of June, 2007, the expenses of, and
incidental to, such audit (including the remuneration of the Accountant) shall
be determined by the Chief Commissioner or Commissioner in accordance with such
guidelines as may be prescribed59
and the expenses so determined shall be paid by the Central Government.]
(3) The
assessee shall, except where the assessment is made under section 144, be given an opportunity of being heard
in respect of any material gathered on the basis of any inquiry under
sub-section (2) 60[or any audit
under sub-section (2A)] and proposed to be utilised for the purposes of the
assessment.
61[(4) The provisions of this
section as they stood immediately before their amendment by the Direct Tax Laws
(Amendment) Act, 1987 (4 of 1988), shall apply to and in relation to any
assessment for the assessment year commencing on the 1st day of April, 1988, or
any earlier assessment year and references in this section to the other
provisions of this Act shall be construed as references to those provisions as
for the time being in force and applicable to the relevant assessment year.]