Demand cut from ₹10,050 to ₹1,310
TaxSavvy for income tax notice
Got an income tax notice? Breathe. We read it.
We decode the section and deadline, draft the reply, and a CA files it.
If you wait: No reply by the date: the officer can assess on the papers alone (Sec 271, old 144)
How we get it done
Four steps, the same for every job. You see each one ticked.
Information
PAN. Notice, all pages, with DIN
Discussion
Is the AIS entry correct, duplicate, or someone else's?. Was the income already shown under another head?
Forms
AIS feedback where entries are wrong. Agree / disagree response on e-Proceedings
Deliverables
Response and feedback acknowledgements. Tax payable note, if any
See what you get, free
Real formats, made with dummy data.
Sample Sample ₹21,300 left every month
Sample ₹36,280 less tax in the new regime
Questions, answered the CA way
Facts, Provisions and law, Analysis, Conclusion.
Section 143(2) (now 270(8)), Scrutiny notice: the real assessment begins
- Facts
- Sec 143(2) (now Sec 270(8), Income-tax Act 2025) means the IT department has selected your return for detailed scrutiny. A human AO (Assessing Officer) or faceless assessment unit will examine specific items in your return. The notice will say what is being questioned, income, deductions, transactions.
- Provisions and law
- IT Act 1961, Sec 143(2) (now 270(8)) | Time limit: 3 months from end of AY | Notice must be issued within 3 months of end of AY (for AY 2024-25 → by 30 June 2025)
- Analysis
- Types of scrutiny: • CASS (Computer Aided Scrutiny Selection): System-selected based on risk parameters, high cash deposits, large deductions, mismatch with TDS data. • Manual scrutiny: AO specifically selected your case, usually means a tip-off or serious red flag. Sec 143(2) (now Sec 270(8)) leads to a formal assessment under Sec 143(3) (now Sec 270(10)). You must respond, ignoring it results in best judgment assessment (AO assumes the worst and raises a demand without hearing you).
- Conclusion
- Check the notice date, if beyond the time limit, the notice is invalid. File a legal objection immediately.
- Read exactly what is being questioned, don't respond to what isn't asked
- Do NOT submit documents before reading the full notice, scope creep is common
- Engage a CA immediately, your response creates a paper trail that affects all future proceedings
Section 270(1) (old 143(1)): Intimation and Demand
- Facts
- The most common IT notice, sent automatically by the CPC computer. Not a scrutiny notice. Not a raid. But if ignored or mishandled, the demand amount gets locked and interest begins. Most Sec 270(1), Income-tax Act 2025 (old Sec 143(1)) demands can be reduced to zero.
- Provisions and law
- Sec 270(1) (old 143(1)); Sec 270(2) (old 143(1)(a)); Sec 289 (old 156); Sec 154; Sec 263(5) (old 139(5))
- Analysis
- What triggers Sec 270(1) (old Sec 143(1)) demand: (1) AIS shows income not declared in ITR, most common. (2) TDS in Form 168 (old Form 26AS) not matching claimed TDS in ITR. (3) Deduction claimed exceeds limit. (4) Arithmetical mistake in ITR. (5) Carried-forward loss claimed without filing return in loss year. Three possible Sec 270(1) (old Sec 143(1)) outcomes: (A) Refund, CPC agrees with your return, issues refund. (B) No demand, no refund, CPC processing matches your return. (C) Demand, CPC finds discrepancy, raises a demand. Do NOT just pay the demand: Sec 270(1) (old Sec 143(1)) demands are often incorrect. In the most common case, FD interest in AIS that taxpayer forgot to declare, the demand is valid but the penalty is avoidable. In the second most common case, TDS credit mismatch due to PAN error by employer, demand is incorrect and should be rectified. Response options: (A) Agree, pay demand.
- Conclusion
- Download Sec 270(1) (old Sec 143(1)) intimation PDF from IT portal, check exact demand amount and reason
- Compare CPC's income computation vs your filed ITR line by line
- Check AIS, identify which item CPC flagged as not declared
- Check Form 168 (old Form 26AS) TDS credits vs TDS you claimed in ITR, any mismatch?
Section 270(8) (old 143(2)): Scrutiny Notice
- Facts
- This is NOT automated, a human officer has selected your return for detailed examination. Specific income, deduction, or transaction is under review. Must be responded to with documentary evidence within the timeline given.
- Provisions and law
- Sec 270(8) (old 143(2)); Sec 270(10) (old 143(3)); Sec 144; Faceless Assessment Scheme 2020; Sec 271(1)(c)
- Analysis
- Why your return was selected: (1) Large refund claim, officer verifies legitimacy. (2) High deductions claimed relative to income (e.g. Sec 123, Income-tax Act 2025 (old Sec 80C) of ₹1.5L on ₹3L income). (3) AIS shows transactions not declared (property purchase, large FD). (4) Specific issue risk profiling by IT department. (5) Information from third party (bank, registrar). Faceless assessment, how it works: Notice arrives on IT portal (also email). You respond online through IT portal → e-Proceedings → Response. Upload documents in PDF. No personal appearance. Officer is anonymous, from a different city. National Faceless Assessment Centre (NFAC) coordinates. What to submit: Depends on the specific query in the notice. Common documents: Bank statements, salary slips + Form 130 (old Form 16), investment proofs (ELSS receipts, PPF passbook), home loan certificate, rent receipts, capital gains statement, property registration documents.
- Conclusion
- Login to IT portal → e-Proceedings → View notices (Sec 270(8) (old Sec 143(2)) notice visible)
- Read notice carefully, identify exactly which item / transaction is under scrutiny
- Note response deadline from notice, calendar the date immediately
- Gather all documents related to the queried item (not your entire file)
Section 245 (now 438): Refund adjustment without notice (what to do)
- Facts
- Sec 245 (now Sec 438, Income-tax Act 2025) allows the IT department to adjust your pending refund against an outstanding demand from a previous year, without first getting your consent, but after giving you prior intimation.
- Provisions and law
- IT Act 1961, Sec 245 (now 438) | Time limit: prior intimation required
- Analysis
- Common scenario: AY 2024-25 refund of ₹50,000 is due. But there's an old 143(1) demand from AY 2021-22 for ₹30,000 that was never addressed. The department issues 245 notice saying they'll adjust ₹30,000 from your refund. You get ₹20,000 instead of ₹50,000. Action: You have 30 days to respond agreeing or objecting to the adjustment. If the old demand was wrong, file 154 rectification simultaneously and respond to 245 objecting to adjustment until rectification is settled.
Got an income tax notice? Breathe. We read it.
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