Responding to Income Tax Notices

The one notice you must never ignore is a demand under Section 156. It carries a payment deadline and interest starts running.

What does each income tax notice mean?

All of the above are provisions of the Income-tax Act, 1961. The reassessment windows under Sections 148 and 149 were shortened with effect from 1 September 2024.

Why did I get a 143(1) intimation?

Because your return was processed. Everyone who files gets one. It is generated centrally and it is not a scrutiny notice.

Open it and look at two columns: what you reported and what the department computed. If they match, do nothing. If they differ, the difference is usually a TDS mismatch, a deduction disallowed for want of proof, or an arithmetic correction.

Where the intimation shows a demand you disagree with, the route is a rectification request, not a fresh return. Where it shows a refund that never arrived, check your bank pre-validation. See income tax refunds.

What is a defective return under 139(9)?

It means the return as filed cannot be processed. Common causes are a missing balance sheet where business income is declared. Or income shown without matching tax paid. Or an ITR form that does not fit your income.

You get 15 days from the intimation to fix it, and the assessing officer can extend that on request. If you do not respond, the return can be treated as never filed. That costs you the carry-forward of losses and can make the filing belated.

The fix is filed as a response to the specific notice on the e-filing portal, not as a new original return. Choosing the wrong ITR form is the most frequent trigger, so check which ITR form applies before you refile.

How long can the department reopen an old year?

Less time than it used to have. The reassessment regime was narrowed with effect from 1 September 2024.

The general limit is three years from the end of the relevant assessment year. Where the income alleged to have escaped assessment is ₹50,00,000 or more, the limit extends to five years.

Before a notice under Section 148 is issued, you should receive a show-cause under Section 148A. That is your opportunity, and it is the stage where a good reply ends the matter. Answer it with documents, not assertions.

If the year is beyond the limit, say so in your reply and cite the provision. Limitation is a complete defence and it is frequently the strongest one available.

How should you actually respond?

Read the section number and the assessment year at the top. Both matter. A notice for AY 2021-22 is answered with that year’s records.

Respond on the e-filing portal, in the specific proceeding. Email to a departmental address is not a response. Keep the acknowledgement.

Attach evidence rather than explanation. A bank statement, a Form 16, a contract note, a rent agreement. Reconcile against Form 26AS and the annual information statement before you reply, because most mismatches originate there. Our page on Form 16 and 26AS covers how to read them.

Never let a deadline lapse while you gather papers. File a partial reply and ask for time. Silence is treated as non-compliance, and non-compliance carries penalties on its own.

How to avoid most notices in the first place

Three habits remove the majority of them. Reconcile your annual information statement before filing, not after. Pay advance tax on time, which our advance tax guide sets out. And file by the due date.

For individuals and HUFs not requiring an audit, the current due date is 31 July 2027. Audit cases run to 31 October 2027. Belated or revised returns run to 31 December 2027. An updated return can be filed for up to 48 months from the end of the assessment year, with additional tax.

If you have already realised a mistake, correcting it yourself is far cheaper than being found. See revised and updated returns.