Income tax notices — what each one is
| Section | What it is | Time to respond |
|---|---|---|
| 143(1) | Intimation after summary processing — arithmetic and prima facie adjustments. May show a demand, or a refund smaller than claimed | 30 days where an adjustment is proposed under 143(1)(a) — explained in detail |
| 139(9) | Defective return — something is missing or inconsistent, so the return is treated as not filed unless cured | 15 days, extension can be sought |
| 142(1) | Inquiry before assessment — calls for a return, accounts or specific information. What can be asked | As specified in the notice |
| 143(2) | Scrutiny — the return has been selected for detailed examination. Limitation and defences | As specified; the proceeding then runs on |
| 148A | Show-cause before reassessment — the Department must put its information to you and hear you first | As specified in the notice |
| 148 | Reassessment — income is alleged to have escaped assessment; a return must be filed for that year. Time limits and defences | As specified in the notice |
| 245 | Intimation that a refund due to you is being set off against an outstanding demand | 30 days — and worth contesting if the demand is disputed |
| 154 | Rectification of a mistake apparent from the record — can be initiated by you or by the officer | As applicable |
| 156 | Demand notice — tax, interest or penalty payable | Generally 30 days to pay or contest |
Separately from these, the Department issues advisories — SMS and email under its e-campaign and nudge programmes. These are not issued under a section and carry no demand. They are not enforceable on their own, but they do mean your return has been flagged, and responding while the matter is still voluntary is materially better than waiting.
The current wave: deductions and exemptions claimed by salaried filers
Most income-tax queries reaching salaried taxpayers at present concern claims made in earlier returns that do not reconcile with the data the Department holds from employers, banks, insurers and donee institutions. The concentration is in:
- HRA under Section 10(13A) — rent claimed with no landlord PAN, no bank trail, or no tenancy behind it.
- Chapter VI-A deductions — 80GGC political contributions, 80G and 80GGA donations, 80D and 80DDB medical claims, 80E education loan interest, 80EE and 80EEB loan interest.
- Section 10(14)(i) allowances — travel on tour or transfer, daily allowance and conveyance, prescribed under sub-clauses (a) to (c) of Rule 2BB(1). These are exempt only to the extent actually incurred, and only where the employer genuinely granted the allowance — which makes a claim not reflected in Form 16 immediately visible.
Why 10(14)(i) matters more than it used to: under the default new regime in Section 115BAC, most exemptions and deductions are unavailable, and these allowances are among the few that survive. That has made them the remaining lever — and, in the hands of some return preparers, the remaining vehicle for inflated claims. What the notices mean, whether an updated return corrects the position, and why an unsupported claim attracts a penalty of 200% rather than 50% is set out in the guide to notices on wrongly claimed deductions and exemptions.
Search and survey action
A search under Section 132 and a survey under Section 133A carry materially different powers — a survey is confined to business premises during business hours and does not permit seizure of cash or valuables. For searches conducted on or after 1 September 2024, the assessment that follows is under the reintroduced block assessment scheme rather than Section 153A, covering the six preceding assessment years and the current year up to the date of search as a single block. What that involves, and the safeguards that apply during the action itself, is set out in the guide to search, seizure and block assessment.
GST notices
Scrutiny notices (ASMT-10), show-cause and demand notices (DRC-01 / DRC-01A), return non-filing notices (GSTR-3A), registration cancellation show-cause (REG-17), audit intimations (ADT-01), and input-credit mismatch queries arising from GSTR-2B versus 3B differences. GST notices carry their own consequences — a registration cancellation proposal or blocked credit affects the business immediately, not only at assessment.
These arrive as a ladder rather than in isolation: automated mismatch intimations in DRC-01B and DRC-01C, then scrutiny in ASMT-10, then a pre-notice intimation in DRC-01A, then the show-cause in DRC-01. Each rung has its own reply window, and for demands covering FY 2017-18 to 2019-20 there is a live limitation question arising from the Section 168A extension notifications that is worth checking before the merits. The GST notice ladder is set out here.
How a reply is built
A reply that argues only “the addition is wrong on the facts” is under-built, however strong that argument is — if it is rejected, nothing remains. A considered reply works through three independent layers, so the officer has to reject all of them rather than just the first:
- Is the notice itself valid? Whether it carries a Document Identification Number, is addressed to the correct existing person, was issued within limitation and properly served, and — for reassessment — whether sanction came from the correct authority with genuine application of mind. A defect here can end the matter without reaching the merits, which is why it is checked first and checked even when the facts look strong.
- The substance, on more than one ground. The provision the officer invoked is rarely the only one the facts engage. The same transaction may also be defensible under an exemption, a different head of income, or an alternative computation. These are pleaded together and in the alternative, not chosen between.
- Quantum and fallback. If the primary position is not accepted in full, what still improves the outcome — a partial disallowance instead of a whole one, immunity from penalty under Section 270AA where its conditions are met, or interest-only exposure rather than penalty. This is drafted even when the main case looks strong, because a split outcome is common.
None of this guarantees a result — the outcome depends on the facts, the evidence and the officer. What it does is ensure the case is not lost on a point nobody checked.
What happens if a deadline is missed
- A 139(9) defect left uncured can result in the return being treated as never filed — which can cost carried-forward losses and trigger late-filing consequences.
- A 143(1)(a) proposed adjustment not responded to within 30 days is generally made final, and the demand follows.
- An unanswered 142(1) or 143(2) can lead to a best-judgement assessment, where the officer estimates the income rather than examining yours.
- An unpaid demand attracts interest, and can be set off against later refunds under Section 245 — which is how a forgotten demand from an old year surfaces years later as a missing refund.
Where a deadline is genuinely too short, an adjournment can usually be sought — but it has to be requested properly and on the record, not assumed.
The process
- Send a photo or PDF of the notice on WhatsApp.
- You receive a plain-language explanation: what the department is asking, why, the deadline, the realistic exposure, and the fee — before you commit.
- Required documents are listed and collected; the reply is drafted with supporting workings and filed on the portal (GST portal / income-tax e-proceedings), with acknowledgement shared.
- Follow-up: if the matter proceeds further (personal hearing, additional query), you’re represented through it.
What to send first
The notice itself, the return and computation for the year concerned, and whatever evidence supports the item being questioned. For a deduction or exemption query that means the receipts, certificates, rent agreement or bank statements behind the claim. A view on what is defensible — and what is not — comes before anything is filed.
Notices are increasingly generated from data matching (GSTR-2B against 3B, AIS against the return, TDS and employer data). A correct reconciliation with documentary backing resolves most of them at the first reply. Replying without workings, or not replying, is how a small mismatch becomes an assessed demand with interest and penalty.