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Intimation under section 143(1)

Intimation notice ITR creative for blog 696×348 1

Section 143(1) refers to the intimation order given by the Income Tax Department of India to the assessee against a return filed for any assessment year. In India, it is mandatory for individuals with a specified amount of annual income to file for an Income Tax Return within a specified time limit. Thus, it is necessary to understand what happens after the taxpayer has filed the return of income.

Income tax return is a form wherein taxpayer reports his gross taxable income obtained from various sources, his deductions and the net tax liability.

After the e-filing process has been completed by a taxpayer the Income Tax Department carries out a preliminary assessment of all the returns filed and informs taxpayers of the result of such preliminary assessment. This assessment primarily includes arithmetical errors, internal inconsistencies, tax computations and verification of tax payments. Such communication to the taxpayer post the preliminary assessment is called an intimation under section 143(1).

The assessee after filing the return of income receives intimation under section 143(1) if the assessee has paid either more or less than the amount which he is actually liable to pay. If the payment made is less than the actual amount, the assessee is required to make the payment. In case payment made is more than the actual amount, the assessee will be informed about the refund amount in the intimation sent by the department.

The total income of the assessee shall be computed under this section after making the following adjustments to the total income in the return-

  1. Any arithmetical error in the return.
  2. Any  incorrect claim which is apparent from any information in the return where incorrect claim means the following-
  • of an item which is inconsistent with another entry of the same item in such return; or
  • in respect of which information was required to be furnished to substantiate such entry; or
  • in respect of deduction where such deduction exceeds specified statutory limit.
  1. Disallowance of losses claimed if the return of the previous year for which set off of loss is claimed was furnished beyond the due date of filing u/s 139(1).
  2. Disallowance of expenditure indicated in the audit report but not taken into account in computing the total income.
  3. Disallowance of deduction under section 10AA, 80IA, 80IAB, 80IB, 80IC, 80ID or 80IE if the return has been filed after the due date u/s 139(1).
  4. Addition of income appearing in Form 26AS, 16 or 16A which has not been included in computing the total income but this is applicable only for the A.Y. 2017-18.

Time limit for intimation u/s 143(1)
The intimation u/s 143(1) can be sent by the tax department to the assesse any time before the expiry of one year from the end of the financial year in which return was furnished i.e. the notice u/s 143 can be sent before the expiry of assessment year.

If a taxpayer does not receive an intimation within such period, it simply means that no adjustments are carried out to the return filed by the taxpayer and there is no change in tax liability / refund. The acknowledgement itself is deemed to be section 143(1) intimation.

Opportunity of being heard
An opportunity of being heard shall be provided to the assesse before making any adjustment to explain and rectify the same within 30 days of such intimation and response, if given, by the assessee shall be considered before making any adjustments. If no such response is received by the assessee within 30 days of issue of such intimation then the adjustments can be made without any opportunity of being heard.

If you have recently received an intimation from the tax department and require assistance in filing a revised return or rectification application or tax assessment, our team of experts can assist you.

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