Income Tax Scrutiny Notice — Section 143(2) Explained

Updated: 3 June 2026

What is income tax scrutiny? Income tax scrutiny under Section 143(2) means the Assessing Officer (AO) is examining your ITR in detail. There are three types: Limited scrutiny — restricted to specific issues like unusually high deductions; Complete scrutiny — covers all income sources, deductions, and tax liability; CASS (Computer-Assisted Scrutiny Selection) — random or risk-based selection by algorithm. Common triggers include large cash deposits, AIS/ITR mismatches, undisclosed capital gains, and foreign assets. You must respond within the specified deadline (typically 30 days) with supporting documents.

30 Days Section 143(2) notice — respond within 30 days with supporting documents via the e-Filing portal. Missing this deadline leads to best judgement assessment under Section 144.

Types of Income Tax Notices

The Income Tax Department issues several types of notices. Understanding which notice you have received determines how you must respond.

Notice	Purpose	Response Deadline	What to Do
143(1)	Intimation after processing ITR — refund, demand, or no change	30 days (if demand raised)	Pay demand or file rectification under Section 154 if incorrect
143(2)	Scrutiny — AO is examining your return in detail	As specified (typically 30 days)	Respond online with supporting documents; engage CA for complex cases
142(1)	Pre-assessment inquiry — AO seeks information or documents before assessment	As specified in notice	Submit requested information; non-compliance is an offence
148	Reassessment — AO has reason to believe income escaped assessment	File ITR within 3 months of notice date	File revised/fresh ITR; respond to all queries; may need legal advice
156	Demand notice — tax, interest, or penalty is payable	30 days from date of notice	Pay demand or file appeal under Section 246A before CIT(A)

How to Respond to a Scrutiny Notice

All responses to Section 143(2) notices must be submitted online via the Income Tax e-Filing portal. Physical submissions are not accepted.

Step 1 — Log in: Go to incometax.gov.in and log in with your PAN and password.

Step 2 — e-Proceedings: Navigate to Pending Actions > e-Proceedings. Locate the notice under your PAN.

Step 3 — Read the notice carefully: Understand whether it is limited or complete scrutiny and the specific issues raised.

Step 4 — Gather documents: Common documents required include bank statements (all accounts), salary slips and Form 16, Form 26AS and AIS printout, investment proofs (80C, 80D), capital gains statements from brokers and mutual fund platforms, property sale/purchase documents, foreign income or asset details, and any business income/expense records.

Step 5 — Submit response: Upload documents and provide written explanations for each query. Respond within the specified deadline.

Frequently Asked Questions

What triggers income tax scrutiny?

Common triggers include: large cash deposits inconsistent with declared income, high 80C deductions relative to income, mismatch between income reported in ITR and data in AIS/Form 26AS (TDS, capital gains, interest), significant capital gains not declared, foreign assets or foreign income not disclosed, high-value transactions reported by banks or registrars (SFT data), and previous history of under-reporting. CASS (Computer-Assisted Scrutiny Selection) also picks returns randomly based on risk parameters.

How do I respond to a Section 143(2) notice?

Log in to the Income Tax e-Filing portal (incometax.gov.in), go to e-Proceedings, and open the notice under your PAN. Read the notice carefully to understand what is being questioned — it will specify whether it is limited or complete scrutiny. Gather supporting documents: bank statements, salary slips, Form 16, investment proofs, capital gains statements, and any other relevant records. Submit your response online within the deadline (typically 30 days from the date of notice). It is advisable to engage a CA for this process.

What happens if I do not respond to a scrutiny notice?

Ignoring a Section 143(2) notice is a serious mistake. The Assessing Officer will proceed to make a best judgement assessment under Section 144, estimating your income based on available information. This typically results in a large demand notice, penalties under Section 270A, and possible prosecution. The AO may also treat income from unreported sources at maximum marginal rate and disallow all claimed deductions.

What is the difference between a 143(1) intimation and a 143(2) scrutiny notice?

Section 143(1) is a routine intimation — it is automatically generated after processing your ITR and compares your return with department data. It may result in a refund, demand, or no adjustment. Section 143(2) is a scrutiny notice — it means a human Assessing Officer has selected your return for detailed examination and will verify all or specific aspects of your income, deductions, and tax liability. Section 143(2) is significantly more serious and requires a detailed response.

Should I hire a CA to respond to a scrutiny notice?

For limited scrutiny involving a minor mismatch you can clearly explain with documents, you may respond yourself via the e-Filing portal. However, for complete scrutiny, CASS selection, notices involving capital gains, foreign income, or large transactions, engaging a qualified Chartered Accountant (CA) is strongly recommended. A CA can represent you before the Assessing Officer, prepare a comprehensive response, and help avoid inadvertent admissions that could increase your tax liability.

Income Tax Notice ITR Filing Income Tax e-Filing Form 26AS AIS

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