How to deal with Income Tax Notice under Section 143(3)

Income Tax Notice Under Section 143 (3) deals with Scrutiny Assessment under the Income Tax Act which is a detailed assessment. The notice under this section is received by the assessee where the income tax department is doubtful about the authentication of the income or has information regarding income concealment. The scrutiny is made to confirm the genuineness and correctness of various claims, deductions etc. made by the taxpayer in the return of income.

In the present scenario, the Income tax department has started scrutinizing returns under Sec.143 (3) so that people become serious in complying with tax regulations. In response to the notice, you are required to produce documents in support of your investments, claim for tax deductions, allowance and your source of income in the financial year.

Validity of Income Tax Notice under Section 143 (3)

An income tax notice served under Sec.143 (3) had to be issued by the income tax department within 6 months of the relevant assessment year for which the tax returns was filed.

Therefore, you should check the validity of the notice issued as well as the duration within which you need to respond to the assessing officer. If it is served after those first 6 months of the assessment year, then it is considered as invalid.

Way to respond when you get an Income Tax Notice under Section 143 (3)

If the income tax computations made by you are correct, then you just need to respond in the following manner:

1. Collect all the details of IT computation which you would have computed while calculating it earlier. In case you are an employee, Form 16/16A would be helpful in getting all the details as the computations are already done by your company.
2. Prepare a covering letter and indicate all the annexures attached with the reply letter.
3. If any of your income tax dues are pending with the income tax department, you can also mention it in the covering letter.
4. Submit the file to the Assessing officer. Remember to keep its copies before submitting.
5. Take the acknowledgement copy from the Assessing officer for your own records.

However when you are not sure about the treatment of any particular receipt not shown in income tax return, you should seek professional’s advice instead of directly approaching to the Assessing officer. They can help you to resolve such income tax notices faster and in an accurate manner.