Whenever we submit any kind of document to the government, we always hope that we have done our due diligence and the government will be satisfied with the details provided by us. However, it is not always the case and if you have not submitted all the details as required, you can find yourself at the mercy of the assessing officer with whom you will have to justify yourself to, with proof. When we submit our yearly tax returns, we mostly hope for one of two situations. The first being that everything has been filed properly and the ITD is satisfied with our report of yearly income or we expect a refund, but this is not always the case. When you file your tax return one of three things can happen, as per section 143(1).
When we submit our yearly tax returns, the tax department sends us intimation in the form of a notice under Section 143(1). This notice is auto-generated based on the result of the preliminary assessment of your tax return.
3 types of notices can be sent to you u/s 143(1) by the Income Tax Department:
Time limit for the notice to be served is up to 1 year after completion of relevant Assessment Year. Notice is sent after the expiry of one year from the end of the Financial Year in which the return is filed.
[ Read: Notice of Adjustment u/s 143(1)(a) ]
The income Tax department sends this notice seeking a response to the errors / incorrect claims / inconsistencies which attract adjustment(s) under Section 143(1)(a) of the I-T Act.
In the AY 2017-18, several taxpayers have received this notice. A number of taxpayers who had filed their returns for AY 2017-18 had received emails from the Central Processing Centre (CPC) seeking clarification under Section 143(1)(a) of the I-T Act for the mismatch between the income and deduction when compared to Form 16, Form 16A or Form 26AS.
Recipient of the mail is given a time period of 30 days from the date of receiving the intimation to send a response. If the recipient fails to respond, the return is processed after making necessary adjustment(s) u/s 143(1)(a), without providing any further opportunities in this matter.
Let’s look at some of the most common reason why tax payers are getting this notice
Open the notice and scroll down to Page 2 to understand the difference –
The mismatch is due to an extra deduction of Rs.1,01,000 that’s not in the Form 16.
If you look at entry no. 1 & 2, we can deduce the following:
Taxpayers who have also had savings bank account interest or income from fixed deposits or house property that’s not included in the Form 16 may also get this email.
If you want to revise the return against this notice received then, it must be within 15 days of agreeing with the demand.
Receiving a scrutiny notice is never a pleasant experience and failure to respond to it correctly can result in further proceedings or penalties. To ensure any notices you receive are handled with care and attention to detail, consult your personal tax experts at H&R Block India to get instant tax notice assistance.
Note: You will have to attach the supporting documents regarding the amounts of discrepancy before you submit your response. (e.g., rent receipts, life insurance statement, home loan interest certificate, Form 16, Form 16A etc.)