Got an income tax notice? What it means and how to reply

An email or SMS about an income tax notice is unsettling, but most notices are routine. Many simply tell you how your return was processed, or ask you to correct a mistake.

What you mustn't do is ignore one. Every notice has a deadline, and if you miss it the department can decide the matter without your side of the story, sometimes with interest or a penalty.

Fake tax notices are a common scam. Before you act on one:

• Look for the DIN. Every genuine notice from the department carries a Document Identification Number. Verify it with the “Authenticate notice/order issued by ITD” service on the e-filing portal.
• Don't click links in the email or SMS. Go to incometax.gov.in yourself and log in.
• Never share passwords or OTPs. The department doesn't ask for them by email or phone.
• Never pay into a personal account. Tax is paid through the official challan system, not to a person.

• Section 143(1) — intimation. A summary after your return is processed, showing any adjustments and whether you owe tax or get a refund. If you agree, you don't need to do anything.
• Section 139(9) — defective return. Something in your return is missing or inconsistent. You fix it by filing a corrected return within the time given.
• Section 142(1) — inquiry. The officer wants documents or information, sometimes before deciding whether to examine your return in detail.
• Section 143(2) — scrutiny. Your return has been picked for detailed examination. It doesn't mean you've done something wrong, but you'll need to support the items under review with evidence.
• Section 148 — income escaping assessment. The department believes some income wasn't taxed. This is serious and time-bound.
• Section 156 — demand. Tax, interest or a penalty you're asked to pay.
• Section 245 — refund adjustment. The department proposes to set a refund off against tax it says you owe. You can agree or disagree.

The section number is printed on the notice. Read the whole notice: it says what's being asked, by when, and how to respond.

Most notices are answered on the e-filing portal, through e-Proceedings:

1. 1Log in at incometax.gov.in with your PAN or Aadhaar and password.
2. 2Go to Pending Actions → e-Proceedings.
3. 3Choose Self (or the option for an authorised representative if you're replying for someone else).
4. 4Open the notice and select Submit response.
5. 5Say whether you agree or disagree, explain briefly, and attach supporting documents as PDFs.
6. 6Submit, and download the acknowledgement for your records.

For a defective-return notice under 139(9), the reply is a corrected return uploaded in response to the notice. The portal's own help page on e-Proceedings walks through each screen.

• The notice itself, and the return it refers to.
• Form 16 from each employer, and your Annual Information Statement (AIS) or Form 26AS.
• Bank statements for the year.
• Proof of the deductions or exemptions you claimed: rent receipts, investment statements, insurance premiums, home loan certificates.

You can handle an intimation you agree with, or a simple correction, yourself. Get a chartered accountant involved when:

• it's a scrutiny (143(2)) or reassessment (148) notice;
• you disagree with a demand, or the amount is large;
• you don't understand what's being asked, or the deadline is close.

A CA can tell you what the notice really means, what to submit, and how to word your reply.