Ms Deeksha received a demand payable in intimation under section 143(1) from Income tax department. Help her in understanding what is intimation under section 143(1), why it is sent to her and how can she respond to Income tax department?

After Filing of your Income tax returns, Income tax department carries out a preliminary assessment of all the returns filed and intimate taxpayers the result of such preliminary assessment. Such intimation to the taxpayers post preliminary assessment is called Intimation under Section 143(1).

While processing the ITR, the tax department determines the sum payable or the actual amount of refund after making the following adjustments, an intimation shall be prepared or generated and sent to the assessee.
The Intimation shall specify the sum determined to be payable by or the amount of refund due to, the assessee.

Following are the adjustments that can be made by the Income Tax department:

  1. Any Arithmetical error in the return; or
  2. An incorrect claim, if such incorrect claim is apparent from any information in the return.
  3. Disallowance of loss claimed, if return is filed beyond due date u/s 139(1)
  4. Disallowance of expenditure indicated in the audit report but not taken in to account into computing the total income in the return
  5. Disallowance of deduction u/s. 10AA, 80-IA, 80-IAB, 80-IB, 80-IC, 80-ID or 80-IE, if return is filed beyond due date u/s. 139(1)

The Intimation shall specify the sum determined to be payable by or the amount of refund due to, the assessee. An intimation shall also be sent to the assessee in case where the loss declared by the assessee is adjusted but no tax, interest or fee is payable by, or no refund is due, to him.

Where there is neither any adjustments nor any tax due from or refund payable to assessee, the acknowledgment of the return shall be deemed to be the intimation u/s 143(1).
The intimation will be sent to person regarding the same via email and SMS under section 143(1).

How to respond to Intimation u/s 143(1) in case of Demand Payable?

  • If the assessee agrees with the demand , then he/she will be required to pay the amount of tax as per the intimation u/s 143(1) . The taxes can be paid through bank or online payment. According to the current income tax laws, the time limit to respond to this is 30 days. If person do not respond to the notice within the stipulated time period, the department can take action against person.
  • If the assessee disagrees with the demand,
    • if you are able to identify the mistakes you have made while filing your return from the intimation, and they can be rectified by filing a revised return.
    • if there is no mistakes and you do not agree with the adjustments made by CPC, you can file an online rectification application under Section 154(1) intimating the correction of mistake appearing in the Section 143(1) intimation. 

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