Income Tax Notice
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Income Tax Notice: Check and Authenticate ITR Notices Online
A taxpayer may receive a communication from the Income Tax Department even after filing an Income Tax Return on time. Some notices ask for information or clarification, while others provide an intimation for the taxpayer's records.
Every notice should be read carefully and authenticated before action is taken. A response may be required within a specified period to maintain compliance and avoid penalties.
LegallensIndia helps taxpayers verify Income Tax notices, understand the issue, collect documents, and prepare an appropriate response.
What is an Income Tax Notice?
An Income Tax notice is an official communication sent by the Income Tax Department to a taxpayer regarding the taxpayer's return, tax payments, assessment, or another tax matter.
A notice may concern missing information, a discrepancy in the return, an assessment, a tax demand, or a request for supporting documents.
The taxpayer should respond within the time stated in the notice to resolve the matter with the tax authorities.
Types of Income Tax Notices
| Section | Purpose |
|---|---|
| 142(1) | Requests additional information or documents for a filed return or directs a person to file a return. |
| 139(9) | Issued when a filed return is considered defective or incomplete. |
| 148 | Issued where the Department believes income escaped assessment or a required return was not filed. |
| 156 | Communicates a demand for tax, penalty, or other amount payable. |
| 143(1) | Computerised intimation after return processing showing a tax demand, refund, or another adjustment. |
| 143(2) | Indicates that the return has been selected for detailed scrutiny. |
| 131 | Issued where the officer suspects concealment of income. |
| 245 | Relates to adjustment of a refund against an outstanding tax demand. |
Notice Under Section 133(6)
Under the E-Verification Scheme 2021, the Income Tax Department may issue a notice under Section 133(6) when it finds a discrepancy between the return and information available in the Annual Information Statement.
Common Reasons
- An ITR was not filed even though AIS information indicates income above the basic exemption limit.
- Salary, interest, capital gains, or other income appears in AIS but was not correctly reported in the return.
- Property purchases, foreign travel, mutual-fund investments, or stock investments shown in AIS are inconsistent with the declared income.
How to Respond
Review the Notice
Compare the AIS information with the Income Tax Return and determine whether the mismatch resulted from the taxpayer's return or Department data.
Open E-Verification
Log in to the Income Tax Portal and navigate through Pending Actions, Compliance Portal, and E-Verification.
Submit the Response
Complete the questionnaire under the e-verification section and upload the relevant supporting documents.
If the Taxpayer Made the Error
The taxpayer may file an Updated Return under Section 139(8A), pay additional tax and applicable penalties, and submit the response through the Portal.
If the Department Made the Error
Provide a clear explanation through the Insights Portal and attach documents supporting the taxpayer's position.
Notice Under Section 142(1)
An Assessing Officer may issue this notice when:
- A return was filed, but additional information, documents, or clarification is required to complete the assessment.
- A return was not filed, and the Assessing Officer directs the taxpayer to file it within the prescribed period.
The notice is intended to collect the details required for a fair and complete assessment of income.
Consequences of Not Responding
- A penalty of ₹10,000 for each instance of non-compliance.
- Prosecution that may result in imprisonment for up to one year.
- In some cases, both penalty and prosecution may apply.
Intimation Under Section 143(1)
After an ITR is filed, the Central Processing Centre processes it electronically and may make automatic adjustments including:
- Correction of arithmetical errors.
- Disallowance of an incorrect claim evident from the return.
- Rejection of incorrectly claimed losses or expenses.
- Addition of income not reported in the return.
The CPC may issue an intimation where:
- Tax is payable.
- A refund is due.
- There is no tax or refund, but the carried-forward loss changes.
The supplied content states that the intimation must be sent within nine months from the end of the financial year in which the return was filed. Its example states that a return for AY 2024-25 filed on 27 July 2024 may receive an intimation up to 31 December 2025.
How to Analyse the Intimation
- Compare the figures reported in the ITR with the figures recalculated by CPC.
- Identify differences in income, deductions, TDS, and prepaid taxes.
- If the mismatch or demand resulted from an error, file a rectification request under Section 154 within four years from the end of the relevant assessment year.
- If the demand is correct, pay it using the payment link provided in the intimation.
Notice Under Section 143(2)
A notice under Section 143(2) indicates that the return has been selected for scrutiny. The Assessing Officer examines whether the taxpayer:
- Understated income.
- Claimed excessive losses.
- Paid less tax than required.
The notice may be followed by a questionnaire and a request for documents. The supplied content states that the Assessing Officer must issue it within three months after the end of the relevant assessment year. Its example gives 31 August 2025 as the last date where a return for AY 2024-25 was filed on 19 June 2024.
How to Respond
Review the Notice
Read the notice and annexures carefully to understand the reason for scrutiny.
Prepare the Response
Draft a cover letter that clearly addresses every query and attach the requested supporting documents.
Submit Online
Log in to the Income Tax e-Filing Portal, open e-Proceedings, upload the cover letter and documents, and submit the response.
Notice Under Section 245
This notice is issued when an outstanding demand from an earlier year may be adjusted against the current year's refund. Adjustment can be made after issuing a notice and giving the taxpayer an opportunity to respond.
The taxpayer must respond within 30 days from receiving the notice. If no response is submitted, the Assessing Officer may treat the taxpayer as having agreed to the adjustment.
The supplied content recommends responding promptly and verifying the accuracy of the demand before the refund is adjusted.
Common Reasons for Receiving an Income Tax Notice
- Income or Tax Mismatch: Differences between the ITR, Form 26AS, AIS, or TDS information.
- Non-Filing or Delayed Filing: Failure to file the return on time or missing the deadline.
- Incorrect ITR Form: Using a return form that does not match the taxpayer's income sources.
- High-Value Transactions: Cash deposits, property transactions, or credit-card payments not properly reflected in the return.
- Investments in a Spouse's Name: Failure to disclose investments covered by clubbing provisions.
- Capital-Gain Reporting: Omission or incorrect reporting of long-term gains from shares or mutual funds.
- Incomplete Documents: Missing information or failure to provide requested supporting records.
- Random Scrutiny: Selection of the return by the Assessing Officer for verification.
- Omitted Income: Failure to report interest, freelance, foreign, rental, or other income.
- Demand or Refund Adjustment: Adjustment of a current refund against an earlier outstanding demand.
- Unpaid Self-Assessment Tax: Filing a return without paying the tax due.
- Suspected Tax Evasion: Departmental belief that tax was deliberately evaded in earlier years.
What to Do After Receiving an Income Tax Notice
Read the Notice Carefully
Identify whether the communication concerns a mismatch, non-filing, scrutiny, demand, or another issue.
Verify the Taxpayer Details
Check the full name, PAN, address, and assessment year to confirm that the notice relates to the taxpayer.
Identify the Discrepancy
Determine whether the notice arose from income or tax-credit mismatch, non-filing, incorrect form selection, or an unreported transaction.
Check the e-Filing Portal
Log in and confirm that the notice appears under e-Proceedings or View Notices and Orders. Review the instructions and deadline.
Respond Within the Time Limit
Submit the reply within the period specified in the notice to avoid consequences such as penalty, interest, or prosecution.
Attach Supporting Documents
Provide relevant documents such as Form 16, bank statements, investment records, and a clear explanation supporting the response.
Consequences of Ignoring an Income Tax Notice
Ignoring a notice can lead to penalty, interest on unpaid tax, or the return being treated as invalid. It may also cause loss of exemptions, disallowance of losses, and additional tax liability.
In some cases, further legal action or prosecution may follow. A taxpayer should therefore respond promptly and accurately.
Documents Required to Respond
| Document Category | Common Documents |
|---|---|
| Notice | Copy of the Income Tax notice received. |
| Income Proof | Salary slips, Form 16 Part B, and business or professional income statements. |
| TDS Certificates | Form 16 Part A and Form 16A for non-salary TDS. |
| Investment Proof | LIC receipts, PPF passbook, ELSS statements, tuition-fee receipts, and other deduction or exemption records. |
| Bank Records | Bank statements supporting transactions and income entries. |
| Tax Information | Form 26AS and Annual Information Statement. |
| Return Records | ITR acknowledgement and computation sheet for the relevant assessment year. |
| Issue-Specific Records | Capital-gain reports, rent agreements, loan statements, or other documents relating to the notice. |
How to Authenticate an ITD Notice or Order
Step 1: Open the Authentication Facility
Visit the Income Tax e-Filing Portal, open Quick Links, and select Authenticate Notice or Order Issued by ITD.
Step 2: Select a Verification Method
Use PAN, document type, assessment year, issue date, and mobile number for notices from AY 2011-12 onward, or use the Document Identification Number and mobile number for any assessment year.
Step 3: Enter PAN-Based Details
For the first method, enter PAN, document type, assessment year, date of issue, and mobile number.
Step 4: Validate the OTP
Enter the OTP received on the mobile number. A valid document displays its DIN and issue date; otherwise, the Portal displays that no record was found.
Step 5: Use DIN Instead
For the second method, enter the DIN and mobile number and then validate the OTP.
Step 6: Review the Result
The Portal confirms an authentic document. If the document is not found, it displays that no record exists for the provided document number.
How LegallensIndia Can Help
- Expert Consultation: Personalised guidance from experienced tax professionals.
- Notice Analysis: Assistance in understanding the notice and its requirements.
- Document Identification: Identification and compilation of the records needed for the reply.
- Response Preparation: Preparation of a precise and timely response addressing the Department's concerns.
- Compliance Assistance: Review of the response for tax-law compliance to reduce further queries or penalties.
Contact LegallensIndia for expert assistance with your Income Tax notice response..