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Received an Income Tax Notice?

Don't panic. A notice is often just a system-generated query. However, ignoring it can lead to heavy penalties.

What it usually means

  • There is a mismatch in your declared income vs. AIS/TIS data.
  • You claimed a deduction (HRA, 80C) without proof.
  • Mathematical error or incorrect challan details.

Risks if ignored

  • Penalty up to 200% of the tax evaded.
  • Bank account attachment or asset freezing.
  • Prosecution in severe cases of non-compliance.

Deep Dive Analysis

The Income Tax Department uses Artificial Intelligence to match your filed return with information collected from banks, employers, and financial institutions (SFT). A notice is usually triggered when there is a deviation between what you declared and what they know. It is not necessarily a demand for tax; often it is just a request for explanation regarding 'Defective Returns' or 'Proposed Adjustments'.

Decode Your Notice Section

Section 143(1)

Intimation comparing your return vs system data.

Section 139(9)

Defective return due to missing info.

Section 142(1)

Inquiry asking for documents before assessment.

Section 148

Income escaping assessment for previous years.

How to Solve This

Select Solution Method

Responding to Intimation on Portal

If you received an intimation proposing an adjustment (tax demand), you can agree or disagree online.

1

Login to E-Filing

Go to Pending Actions > Response to Outstanding Demand.

2

Analyze the Variance

The system will show 'As per Return' vs 'As per Department'. Check if you forgot to add interest income or if a challan wasn't credited.

3

Submit Response

If you Agree: Pay the demand. If you Disagree: Select 'Disagree', provide the reason (e.g., 'Deduction allowable'), and attach proof.

Still unsure what to do?

If the steps above seem complicated, or if the amount involved is high, do not risk a DIY fix. Let our CAs handle it.