Income Tax Notices Under explained: this guide covers what Income Tax Notices Under means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
1. Why Do Notices Come?
Income tax notices are more common than many taxpayers realise — and receiving one does not necessarily mean wrongdoing. Most notices are computer-generated and arise from mismatches between the ITR and AIS data, missing income, or routine scrutiny selection. Understanding the type of notice helps craft the right response promptly.
2. Common Types of IT Notices
| Notice Type | Reason | Required Action |
|---|---|---|
| Intimation under Section 257A (143(1)) | CPC processed ITR and found arithmetic error or TDS mismatch | Pay demand OR file rectification if wrong |
| Section 268 — limited scrutiny | Specific item in ITR requires clarification (e.g., large deduction, capital gain mismatch) | Respond with documents within 15-30 days |
| Section 270 — complete scrutiny | Full examination of ITR (risk-based or compulsory selection) | Comprehensive documentary response |
| Section 279 — reassessment | IT Dept has information that income escaped assessment | Respond showing all income was disclosed |
| Section 285 — rectification | AO found an error in assessment order | Respond if the proposed rectification is wrong |
| Section 148 equivalent (notice for return) | No return was filed for a year | File return immediately with explanation |
3. What Not to Do When You Receive a Notice
- Do NOT ignore the notice — it has deadlines; ignoring results in ex-parte assessment
- Do NOT panic — most notices are resolvable with documentation
- Do NOT respond inaccurately — false information in response attracts penalties
- Do NOT miss the deadline — extension requests must be timely
4. What To Do Immediately
- Read the notice carefully — identify the section, assessment year, and specific query
- Check if the notice is legitimate — verify on IT Portal under e-Proceedings
- Gather relevant documents — bank statements, Form 26AS, AIS, investment proofs, contracts
- Prepare a factual, point-by-point response addressing each query
- Submit online through IT Portal (e-Proceedings section) before deadline
5. AIS Mismatch Notices
The most common trigger today: AIS shows income (interest, dividends, property sale) that was not reported in the ITR. The IT Department AI system auto-compares AIS with ITR and generates notices for unexplained items. Solution: always reconcile AIS before filing ITR; if items in AIS are incorrect, use the AIS feedback mechanism to mark them and file ITR with correct figures.
6. Why TaxClue
Proper notice response requires both legal knowledge and accounting accuracy. TaxClue reviews notices, identifies correct response strategy, and submits comprehensive replies. Contact us for notice handling under ITA 2025.
