Received an Income Tax Notice? Here's Exactly How to Respond

First: Don't Panic — Most Notices Are Routine

The Income Tax Department sends millions of notices every year. The vast majority are automated intimations — not personal accusations of fraud. A notice is simply a formal communication from the department requiring clarification or action. The key is to read it carefully, identify the section, and respond within the deadline.

How are notices delivered? Via email to your registered email address, SMS to your registered mobile, and on the Income Tax portal under e-Proceedings. Always check the portal directly — email notices can sometimes land in spam.

Common Types of Income Tax Notices

Section 143(1) — Intimation (Most Common)

This is the most frequently received notice and is completely automated. It's a processing intimation showing what the IT Department computed vs what you filed.

• Type A: Your return matches the department's computation — no action needed
• Type B: Demand notice — department says you owe more tax. Either pay the demand or file a rectification request if their computation is wrong.
• Type C: Refund is due — refund will be credited to your account

Deadline to respond: If you dispute the demand, respond within 30 days via the IT portal.

Section 143(2) — Selected for Scrutiny

Your return has been selected for detailed scrutiny by an Income Tax Officer who wants to verify your income and claims. This is more serious — respond carefully with supporting documents.

• Read the notice to identify specific items under scrutiny (deductions, income mismatch, large expenses)
• Gather supporting documents: Form 16, bank statements, investment proofs, bills, contracts
• Respond through the portal's e-Proceedings section within the specified deadline
• Never miss this deadline — failure to respond leads to ex-parte assessment (officer decides without your input)

Section 139(9) — Defective Return

Your filed ITR has an error or is missing required information. Common causes:

• Tax payable was shown as zero but there's actually a liability
• Bank account not pre-validated or incorrect IFSC
• Income schedules incomplete
• TDS claimed but not appearing in Form 26AS

Deadline: You have 15 days from the date of notice to either rectify the return or provide a valid reason. If you don't respond, the return is treated as invalid — as if you never filed.

Section 148 / 148A — Notice for Reassessment

This notice means the IT Department believes income from a previous assessment year escaped taxation. This is more serious and requires careful handling.

• Section 148A(b): Show-cause notice — explain why reassessment should not be done. Respond within the deadline.
• Section 148: Notice to file ITR for the reassessment year (if department proceeds after 148A)
• Common triggers: large cash transactions, property purchases, foreign remittances
• Strongly recommended: Consult a tax expert immediately

Section 156 — Notice of Demand

You have outstanding tax, interest, or penalty to pay. Options:

• Pay the demand via Challan 280 and mark it as settled on the portal
• If you dispute the demand, raise a rectification request or file an appeal

Section 245 — Refund Adjusted Against Old Demand

The department has adjusted your current refund against an old outstanding demand. If you believe the old demand was incorrect or already paid, you must respond and provide payment evidence.

5 Steps to Take on Receiving Any Notice

1. Read carefully — identify the section number, assessment year, and response deadline
2. Log in to IT portal → e-Proceedings → view the full notice and any attachments
3. Do NOT ignore — unresponded notices automatically escalate and result in ex-parte orders and penalties
4. Gather documents — the notice will specify what the department wants
5. Respond through the portal or consult a tax expert if the matter is complex

Common Reasons You Might Receive a Notice

• Salary or income mismatch between your ITR and Form 26AS/AIS
• Large cash deposits (reported by banks to IT department)
• High-value property purchase or sale
• Significant credit card or foreign travel expenditure not matching declared income
• ITR not filed despite having taxable income
• Claiming deductions or exemptions that don't match reported data

Received a notice? WhatsApp us — share the notice PDF and we'll review it and guide you on the correct response. Personal attention from Senior Tax Consultant Usman Zamir.