Quick Answer
Under the Income-tax Act, 2025, a taxpayer may receive several categories of notices — defective return (Sec 139(9) equivalent), intimation (Sec 143(1) equivalent), scrutiny (Sec 143(2) equivalent), information (Sec 142(1) equivalent), reassessment (Sec 148 equivalent), demand (Sec 156 equivalent), refund adjustment (Sec 245 equivalent), revision (Sec 263 equivalent), penalty (Sec 270A / Sec 271 equivalents) and prosecution (Chapter XXII). Each has a specific time limit, response procedure and non-compliance consequence. All notices are now delivered through the faceless architecture under Chapter XVI.
Last Updated: 15 April 2026 | Applicable From: Tax Year 2026-27 (1 April 2026 onwards) | Reference: Income-tax Act, 2025 (30 of 2025), as amended by Finance Act, 2026
With effect from 1 April 2026, every notice issued by the Income Tax Department is governed by the Income-tax Act, 2025, which received Presidential assent on 21 August 2025 and replaced the Income-tax Act, 1961. Although the notice letterheads may continue to refer to familiar section numbers, the statutory source is now Chapter XVI (Procedure for Assessment), Chapter XVIII (Appeals and Revisions), Chapter XIX (Collection and Recovery), Chapter XXI (Penalties) and Chapter XXII (Offences and Prosecution) of the new Act. This guide explains each category of notice, the time limit within which it can be issued, the response procedure, and the consequences of non-compliance. It is designed as a practical reference for individual taxpayers, practitioners and small-business finance teams navigating their first assessment cycle under the new statute.
Definition — Income Tax Notice: A written communication issued by an authority under the Income-tax Act, 2025 or the Rules framed thereunder, calling upon a person to furnish information, produce documents, explain entries, pay tax, show cause against a proposed order, or comply with a statutory obligation, and carrying a Document Identification Number (DIN) for authentication.
First, download the notice from the e-filing portal (never rely on e-mail attachments). Second, verify the DIN on the portal to confirm it is genuine. Third, identify the section and chapter under the 2025 Act. Fourth, check limitation — every notice has a statutory outer limit. Fifth, list the issues raised and assemble supporting documents. Sixth, draft a point-wise reply addressing every issue, uploading evidence. Seventh, file the reply before the deadline. Eighth, preserve the acknowledgement and portal screenshot. For anything beyond a simple Sec 143(1) intimation, engage a Chartered Accountant — the first reply becomes the permanent record.
The Income-tax Act, 2025 consolidates the earlier scattered provisions of the 1961 Act into 536 sections across 23 chapters. Notices arise at every stage of the tax life-cycle — at filing, at processing, at scrutiny, at reassessment, at recovery, at revision, at penalty and at prosecution. The common architecture across all of these is the faceless framework: notices are issued through the National Faceless Assessment Centre or the relevant functional centre, delivered to the e-filing portal and the registered e-mail, and responded to through the same portal. Every notice bears a DIN — a Document Identification Number — which the taxpayer can verify on the portal. A notice without a valid DIN is deemed invalid.
The new Act retains the concept of tax year as the sole time period. A notice for tax year 2026-27 relates to income earned between 1 April 2026 and 31 March 2027 and the return filed by 31 July 2027 (or 31 October 2027 for audit cases). Under the Sec 92 equivalent savings clause, references to earlier periods are treated as references to the corresponding previous year under the repealed 1961 Act, so pending proceedings for pre-1-April-2026 periods continue under the old procedure until completion.
Meaning. A notice issued by the Central Processing Centre when the filed return is incomplete or technically defective. Common defects include: tax paid but not entered in the challan schedule, audit report mandatory but not uploaded, balance sheet/P&L omitted where required, mandatory fields left blank, and incorrect ITR form used.
Time limit for response. 15 days from the date of intimation (extendable on a written request with sufficient reason). The Assessing Officer can, on application, extend the time.
Response procedure. Log in to the e-filing portal, open the defective return intimation, select “file response”, correct the defect in the return, and re-submit. An acknowledgement is generated. The corrected return is treated as filed on the original date if the defect is cured in time.
Consequence of non-response. The return is treated as invalid — as if no return was filed at all. This triggers late filing fees under the Sec 234F equivalent, interest under the Sec 234A equivalent, loss of carry-forward of losses, and risk of best judgment assessment.
Meaning. An automated computation sent by the Central Processing Centre after the return is processed. It shows any arithmetical errors, incorrect claims apparent from return information, mismatches with Form 26AS/AIS, and any resulting refund or demand. It is not a scrutiny notice but an acknowledgement plus a preliminary adjustment.
Time limit for issue. Within nine months from the end of the tax year in which the return was filed.
Response procedure. If the intimation shows a refund, no action is needed — the refund is credited. If it shows a demand, verify it against the return and Form 26AS. If the demand is incorrect (for example, due to a missed TDS credit), file a rectification application under the Sec 154 equivalent within four years. If the demand is correct, pay through the e-filing portal within 30 days.
Consequence of non-response. Interest accrues on unpaid demand. Recovery action may follow. Automatic adjustment of future refunds under the Sec 245 equivalent is common.
Meaning. A formal notice initiating a scrutiny assessment under Chapter XVI. The return has been selected by the CASS engine for detailed examination. The notice specifies whether it is limited scrutiny (confined to specific issues) or complete scrutiny.
Time limit for issue. Three months from the end of the tax year in which the return was furnished.
Response procedure. Read the notice, verify limitation, assemble documents, draft a point-wise reply, upload through the portal before the deadline. Request video hearing if needed. Respond to all follow-up information notices issued during scrutiny.
Consequence of non-response. Best judgment assessment under the Sec 144 equivalent, penalty under Chapter XXI, prosecution in extreme cases.
See the detailed guide on scrutiny notice response procedure.
Meaning. A notice calling for information, documents, or a return of income. It can be issued before a return is filed (to compel filing) or during an assessment (to call for specific documents). It is the workhorse notice used throughout every scrutiny proceeding.
Time limit. No overall limitation for issue during assessment, but it must be issued before the final assessment is completed. Response time specified in the notice is usually 7 to 15 days.
Response procedure. Upload the specific documents called for, along with a covering letter linking each document to the issue under examination. If the information is not available, state so in writing with reasons.
Consequence of non-response. Fine of up to ₹10,000 per default, best judgment assessment, and in some cases prosecution for wilful default.
Meaning. Issued when the Department has information suggesting that income chargeable to tax has escaped assessment. A preliminary show-cause notice (the Sec 148A equivalent) is issued first, explaining the material in the Department’s possession and inviting a response. If the response is unsatisfactory, a formal reassessment notice is issued.
Time limit. Basic limit is three years from the end of the relevant tax year. Extended to ten years if the income escaping assessment is likely to be ₹50 lakh or more and is represented by an asset, expenditure on an asset, or an entry in books. Prior sanction of a specified authority is required.
Response procedure. File a response to the preliminary show-cause within the time allowed (usually seven days). If reassessment is ordered, file a return in response to the formal Sec 148 equivalent notice within 30 days and submit detailed written submissions.
Consequence of non-response. Ex parte reassessment, high tax additions, penalty under the Sec 270A equivalent, and in serious cases prosecution.
Meaning. A formal demand for payment issued whenever tax, interest, penalty, fine or any sum becomes payable as a consequence of an order. It specifies the amount, the head (tax/interest/penalty), the period, and the due date.
Time limit for payment. 30 days from service of the notice (unless the Assessing Officer, with prior approval, specifies a shorter period for reasons recorded in writing).
Response procedure. Pay through the e-filing portal. If the underlying order is being appealed, file a stay application before the first appellate authority and seek deferment of recovery. A common practice is to pay 20% of the disputed demand as a pre-deposit to qualify for stay.
Consequence of non-payment. Treatment as assessee in default, interest under the Sec 220 equivalent at 1% per month, attachment of bank accounts, attachment of movable and immovable property, and in extreme cases arrest under the recovery provisions.
Meaning. An intimation proposing to adjust any refund due to the taxpayer against any pending demand for an earlier or later tax year.
Time limit for response. 30 days from intimation. If no response, adjustment is automatic.
Response procedure. File an objection on the portal if the demand being adjusted is disputed in appeal or is prima facie incorrect. Attach the stay order or pending appeal acknowledgement.
Consequence of non-response. The refund is adjusted against the demand. The taxpayer’s legal remedy against the underlying demand still continues, but the cash is gone.
Meaning. A show-cause notice issued by the Principal Commissioner when an order of the Assessing Officer is considered erroneous and prejudicial to the interests of revenue. The PC proposes to revise the order to rectify the error.
Time limit. Two years from the end of the tax year in which the order sought to be revised was passed.
Response procedure. File written submissions explaining why the order is not erroneous or is not prejudicial. Produce the record before the AO showing that the issue was examined. Attend the personal hearing if granted.
Consequence of non-response. Ex parte revision order increasing the assessment. Appeal lies directly to the ITAT within 60 days.
The taxpayer’s own revision remedy (the Sec 264 equivalent) is available against an order considered prejudicial to the taxpayer but not appealable.
Meaning. A show-cause notice proposing to levy a penalty. Under the Income-tax Act, 2025, the main penalty for income-related defaults is the under-reporting and misreporting penalty (the Sec 270A equivalent) — 50% of tax on under-reported income, 200% of tax on misreported income. Specific-default penalties under the Chapter XXI equivalent continue for procedural failures (non-audit, non-maintenance of books, non-quoting of PAN, cash loan violations etc.).
Time limit. Penalty order must be passed within six months from the end of the tax year in which the penalty proceedings were initiated.
Response procedure. File detailed written submissions addressing each ingredient of the alleged default. Argue that the default does not fall within the definition of under-reporting or misreporting. If the underlying addition is being appealed, point out that the penalty should be kept in abeyance.
Immunity option. Under the Sec 270AA equivalent, the taxpayer can apply for immunity from penalty and prosecution by paying the tax and interest on the addition and agreeing not to appeal the assessment. Application must be made within 30 days of the assessment order.
See the detailed comparison at Sec 270A vs the old Sec 271(1)(c).
Meaning. A show-cause notice before launching criminal prosecution under Chapter XXII. Typical offences include: wilful attempt to evade tax, wilful failure to file return, failure to deposit TDS, false statement in verification, falsification of books, and abetment of false return.
Time limit. Governed by the Code of Criminal Procedure limitation for the corresponding offence. The sanction of the Principal Commissioner is required before prosecution is launched.
Response procedure. File a detailed written reply explaining the absence of mens rea. If the offence is compoundable (most are), apply for compounding under the Department’s compounding guidelines by paying the compounding fee, tax, interest and penalty.
Consequence. Imprisonment ranging from three months to seven years depending on the offence, plus fine. Conviction also attracts disqualification from appointment as director, trustee, or registered valuer.
| Notice (2025 Act equivalent) | Purpose | Time limit for issue | Response time | Non-compliance risk |
|---|---|---|---|---|
| Sec 139(9) | Defective return | Nine months from end of tax year of filing | 15 days | Return invalid, late fee, loss of carry-forward |
| Sec 143(1) | Processing intimation | Nine months from end of tax year of filing | 30 days to pay demand; 4 years to rectify | Interest on demand, refund adjustment |
| Sec 143(2) | Scrutiny initiation | 3 months from end of tax year of filing | 15–30 days | Best judgment, penalty, prosecution |
| Sec 142(1) | Information call | Before assessment completion | 7–15 days | ₹10,000 fine per default, best judgment |
| Sec 148 | Reassessment | 3 years (10 years in high-value cases) | 30 days | Ex parte addition, heavy penalty |
| Sec 156 | Demand | With every order creating demand | 30 days | Assessee in default, attachment, arrest |
| Sec 245 | Refund adjustment | Before adjustment | 30 days | Automatic adjustment |
| Sec 263 | Revision by PC | 2 years from tax year of AO’s order | As specified (usually 15–30 days) | Ex parte revision; ITAT appeal |
| Sec 270A / 271 | Penalty | 6 months from end of tax year of initiation | As specified | 50%/200% tax penalty |
| Chapter XXII | Prosecution | CrPC limitation | As specified | Imprisonment, fine, disqualification |
For further reading, consult these sibling guides:
CA V. Viswanathan: After three decades of representing taxpayers, I can say that the single biggest reason adverse orders happen is panic. A taxpayer receives a notice, panics, files a hurried reply without thinking through the evidentiary implications, and then spends years defending that reply in appeal. My standard protocol with every notice is the same: pause, verify, classify, respond. Pause means take 24 hours before sending anything. Verify means check the DIN, download the notice directly from the portal, and confirm it pertains to the correct tax year and PAN. Classify means identify exactly which chapter of the Income-tax Act, 2025 the notice falls under — the response strategy differs sharply between a Sec 143(1) intimation, a Sec 143(2) scrutiny, a Sec 148 reassessment and a Sec 270A penalty. Respond only after the classification is clear. The 2025 Act has made the process more formalised through faceless architecture, which is good for the taxpayer because everything is written and documented. But the same architecture also means that every word you upload is permanent. There is no informal clarification. Treat every reply as a court pleading. One more piece of advice for small-business clients: do not attempt to handle reassessment, revision and penalty notices without professional help. The stakes are high, the limitation rules are technical, and the immunity options require calibrated judgment. Pay for advice once and save a multi-year appeal battle.
What is the most common income tax notice under the 2025 Act?
The most common notice is the intimation under the Sec 143(1) equivalent, issued after the Central Processing Centre processes the return. It either confirms the return as filed, shows a refund, or raises a small demand for arithmetical errors, incorrect claims or mismatches with Form 26AS/AIS. Every return filer receives this intimation. It is not a scrutiny notice but may trigger rectification or a Sec 154 equivalent application if wrong.
What is a defective return notice under the Sec 139(9) equivalent?
A defective return notice is issued under the Sec 139(9) equivalent when the filed return is incomplete — for example, balance sheet not filled where mandatory, audit report not uploaded, or income details missing. The taxpayer is given 15 days to cure the defect. If not cured, the return is treated as invalid, meaning it is deemed as if no return was filed, exposing the taxpayer to best judgment assessment and late filing fees.
What is a Sec 142(1) equivalent information notice?
The Sec 142(1) equivalent is an information-gathering notice under Chapter XVI. It may be issued before a return is filed (to compel filing), or during an assessment (to call for specific documents or explanations). Non-compliance attracts a fine of up to ₹10,000 per default and allows the Department to complete a best judgment assessment under the Sec 144 equivalent. It is the workhorse notice of every scrutiny proceeding.
What is a Sec 148 equivalent reassessment notice?
A reassessment notice is issued when the Department has information suggesting that income has escaped assessment. Under the Income-tax Act, 2025 the basic time limit is three years from the end of the relevant tax year, extended to ten years where the income escaping is ₹50 lakh or more and represented by an asset, expenditure or entry. The taxpayer must be given a show-cause notice before the reopening is sanctioned.
What is a Sec 156 equivalent demand notice?
A demand notice under the Sec 156 equivalent is issued whenever tax, interest, penalty or any sum becomes payable as a result of any order. It specifies the amount, the due date (usually 30 days) and the account for payment. Non-payment attracts interest under the Sec 220 equivalent, treatment as assessee in default, and recovery action including attachment of bank accounts and property.
What is a Sec 245 equivalent refund adjustment intimation?
Under the Sec 245 equivalent, the Department can set off any existing refund against any pending demand. An intimation is issued before adjustment, giving the taxpayer 30 days to object. If no objection is filed, the adjustment is made automatically. If a demand is disputed in appeal, the taxpayer should object to the adjustment and request a stay before the refund is applied.
What is a Sec 263 equivalent revision notice?
A revision notice under the Sec 263 equivalent is issued by the Principal Commissioner when an order of the Assessing Officer is considered erroneous and prejudicial to the interests of revenue. The taxpayer is given a show-cause notice before the revision is passed. Revision can be exercised within two years from the end of the tax year in which the order was passed. Appeal lies to the ITAT.
What is a penalty notice under the Sec 271 / 270A equivalent?
A penalty notice is issued when the Department proposes to levy a penalty — most commonly under-reporting (50%) or misreporting (200%) of tax under the Sec 270A equivalent, or specific defaults under the Chapter XXI equivalent. The notice gives an opportunity to show cause. The taxpayer can apply for immunity under the Sec 270AA equivalent by paying the tax and not filing an appeal.
What is a prosecution notice and when is it issued?
A prosecution notice is issued under Chapter XXII of the Income-tax Act, 2025 for serious defaults such as wilful failure to file a return, wilful attempt to evade tax, false statement in verification, or failure to deposit TDS deducted. It is a show-cause notice before the Department approaches a criminal court. Compounding of offence is available for many defaults on payment of compounding charges and the tax due.
How do I verify whether a notice is genuine?
Every notice issued under the Income-tax Act, 2025 carries a Document Identification Number (DIN). You can verify the notice on the e-filing portal using the DIN. Any notice that does not bear a valid DIN is to be treated as non-est (invalid) and can be challenged. Always download the notice directly from the e-filing portal rather than relying on e-mail attachments, which can be spoofed.
Can I respond to a notice on my own?
Yes for simple intimations like Sec 143(1) equivalent and minor defective-return corrections. For scrutiny, reassessment, revision and penalty notices, engaging a Chartered Accountant is strongly recommended because the response forms the record for every subsequent appeal. An error in the first reply can lead to permanent additions that cannot be corrected later.
What is the time limit to reply to a notice?
Defective return under Sec 139(9) equivalent — 15 days; intimation under Sec 143(1) equivalent — no fixed reply time but rectification within 4 years; scrutiny under Sec 143(2) equivalent — as specified, usually 15–30 days; information notice under Sec 142(1) equivalent — 7–15 days; reassessment under Sec 148 equivalent — 30 days; demand notice under Sec 156 equivalent — 30 days; penalty notices — as specified.
What is the consequence of ignoring a notice?
Consequences include best judgment assessment, penalty of up to ₹10,000 per default, additional penalty for under-reporting or misreporting, interest on demand, attachment of bank accounts, prosecution in serious cases, and compromise of appeal rights. Repeated non-compliance can lead to compulsory scrutiny in subsequent years and higher-risk categorisation by the CASS engine.
Is there a faceless mechanism for responding to notices?
Yes. Under the Income-tax Act, 2025 almost all notices are issued and responded to through the e-filing portal under the faceless regime of Chapter XVI. The taxpayer does not physically meet an Assessing Officer. Video hearing can be requested for scrutiny, reassessment, revision and penalty proceedings. The faceless architecture applies to first appeals as well.
Can a notice be challenged on technical grounds?
Yes. Typical technical grounds include: notice issued beyond limitation, absence of DIN, lack of approval of the Principal Commissioner where required, violation of natural justice, mis-description of the taxpayer, wrong PAN or wrong tax year, and failure to supply reasons in reassessment cases. A well-drafted preliminary objection can often end the proceeding before merits.
Author: CA V. Viswanathan, FCA, ACS, CFE, IBBI Registered Valuer (IBBI/RV/03/2019/12333) — Virtual Auditor, Chennai. Phone: +91 99622 60333 | Email: support@virtualauditor.in