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How to Respond to Income Tax Notices after ITR filing?

Updated on: 29 Feb, 2024 05:41 PM

Did you claim a higher tax deduction or exemption while filing your income tax return (ITR) than what was reflected in your Form 16 or Annual Information Statement (AIS)? Or, have you shown fake rent receipts to claim the HRA exemption? Recently income tax department has sent multiple tax notices to individuals who have done tax evasion in one way or another.

In the event of any discrepancies detected in an individual's or entity's Income Tax Return (ITR), the Income Tax (IT) department promptly issues notifications that require prompt attention. These notifications may pertain to various issues such as scrutiny of returns, failure to file returns, late filing or submission of defective returns, failure to disclose income accurately, failure to file returns with matching tax credits, or failure to pay self-assessment tax. Let’s dive into the details of various income tax notices and how to reply income tax notice.

Reasons Why You Could Get Income Tax Notice?

Even if you have faithfully paid all your taxes and filed your income tax return, you can still receive notices from the Income Tax Department. But don’t worry; there are various other reasons you can receive an Income Tax Notice. Let’s have a look at them -

Inaccurate Information in the Income Tax Return

Suppose there is any discrepancy in your personal details or income details. In that case, you shall receive a notice asking you to disclose your income and asset details both within India and outside India.

A discrepancy in Declared Income and Actual Income

You might also receive a notice from the Income Tax Department if the department suspects that you have not reported all your income. In such a case, you must prepare all your income proofs, paychecks, invoices, and bank statements.

Unexpected Changes in Incomes and Investments

Any substantial increase or decrease in income levels might attract the attention of the Income Tax Department. If your bank account consists of various high-value transactions, you might receive a notice from the Income Tax Department.

Unexpected Inconsistencies in TDS

The TDS mentioned at the time of filing the ITR must correspond to the amount mentioned in Form 26AS and 16A. If there is any difference between both the amounts, you can receive an Income Tax notice under section 143(1).

For Review and Evaluation

You might get a notice under section 143(2) if your ITR is scrutinized. It could be due to discrepancies or incorrect reporting. Ensure you reply as soon as possible, or the department could penalize you.

Delayed ITR Filing

If you don’t file the ITR by the due date, you might receive a notice from the Income Tax Department for delayed ITR filing.

Payments of Refunds Against Outstanding Debts

At times, you might forget to include certain interest income. However, the Income Tax Department quickly notices it and sends you a notice stating that any tax due will be deducted from the Income Tax Refund claimed.

Tax Evasion in Prior Years

If you have evaded taxes in the previous years and not in the current year, you might still receive a notice from the Income Tax Department under section 147 of the Income Tax Act.

Types of Income Tax Notices

You might receive different types of income tax notices. Below is a list of the Income Tax notices -

Notice Under Section 142(1)

The Income Tax authorities can issue a notice for further clarification on the ITR filed or ask for further details on the ITR under Section 142 (1). You might also receive a notice under this section if you do not file the ITR by the due date.

Notice Under Section 139(9)

The Income Tax department might send you a notice for a ‘Defective Return.’ In such a case, the AO or assessing officer grants you 15 15-day grace period to correct the ITR under section 139(9).

Notice Under Section 148

If the Assessing officer has strong evidence that you have not reported or underreported any income that is chargeable to tax or tries to evade taxes, you might receive an Income Tax notice under Section 148.

Notice Under Section 156

The Income Tax Department might send you a notice under section 156 asking you to make the payment of any interest, tax, or penalty due. Generally, the assessee is allowed a window of 30 days to pay the amount asked.

Intimation Under Section 143(1)

Intimation under Section 143(1) is sent to the assessee when an incorrect claim is made, or any other error in tax calculation is made. The intimation consists of a summary of the details of the ITR submitted by the assessee.

Notice Under Section 143(2) and 143 (3)

Notice under Section 143(2) is issued when the assessee’s ITR has been selected for scrutiny or detailed checking. The IT Department sends a notice to the assessee stating that their books will be checked to determine the correctness of the claims made. And the scrutiny is conducted under section 143(3).

Notice Under Section 131

The Income Tax Officer can summon the assessee in person under section 131 by sending him a notice. If the assessing officer has a strong reason or proof to suspect the evasion of taxes or unreported income, he/she can send a notice to the assessees asking them to be present in person.

Notice Under Section 245

Suppose there is any pending tax liability from the previous years. In that case, the Income Tax Department can send you a notice and offset the prior liabilities from the current year’s Income Tax refund.

How to Reply to Income Tax Notices?

Once you receive a notice from the Income Tax, you have to respond to it in the following manner -

  • Visit the e-filing portal, i.e.,, and log in using your User Id and Password. e-filing portal
  • Click on e-proceedings under pending options menu. It consists of notices issued to you with the timeline of response. a timeline of all actions related to the assessment. Click on e-proceedings Click on e-proceedings
  • Click on the links sent in the email. All the messages related to the proceedings will be displayed.
  • Click ‘Submit response’ after opening the notice. under the ‘Response’ tab for every email that requires you to send a response.
  • Depending on the requirement, you can select either ‘full response’ or ‘partial response.’
  • Open the notice received and click on submit response Open the notice received Open the notice received
  • Write a description of your response in not more than 4000 words in the textbox in the area near the response/remarks.
  • Upload a copy of the cover letter or annexures to serve as proof.
  • Click the Checkbox to confirm that all the information provided by you is accurate.
  • Lastly, you have to e-verify your identity using a digital signature and click ‘Yes.’

Have you received an Income Tax Notice or an intimation from the tax department, it is important to respond to them timely to avoid any further consequences. Take help of Tax2win tax expert in responding and resolving the notices. Hire an eCA.

Frequently Asked Questions

Q- How do I reply to a wrong Income tax demand notice?

Login to the e-filing portal. Then click on pending actions and respond to outstanding demand. All the outstanding demands will have pending payment/response as their status.

Q- How can I rectify my ITR after submission?

Visit My Account and click e-filed returns. Select ‘rectification status’ from the drop-down menu and click on ‘Submit.’

Q- What happens when I commit a mistake in ITR filing?

If there is a mistake in the ITR filing, you can rectify your mistake by filing a Revised ITR under section 139(5).

Q- Does Income Tax Department send notices for high-value transactions?

Yes, The Income Tax Department sends notices for high-value transactions that need to be replied to.

Q- What is the format for a reply to an income tax notice?

There are different types of income tax notices that the Income Tax Department may issue for various reasons. The format of the reply may vary depending on the nature and purpose of the notice.

CA Abhishek Soni
CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.