How to Reply to an Income Tax Notice in India – Step-by-Step Guide

Receiving an Income Tax Notice can be stressful, but it does not always mean you have done something wrong. In most cases, the notice is issued to seek clarification, missing details, or additional documents. Knowing how to reply correctly and on time is very important to avoid penalties or legal issues.

In this blog, we explain how to reply to an Income Tax notice online, types of notices, required documents, and common mistakes to avoid.

What Is an Income Tax Notice?

An Income Tax Notice is an official communication sent by the Income Tax Department of India under the Income Tax Act, 1961. It may be issued for reasons such as:

Mismatch in income details
Non-filing or late filing of ITR
High-value transactions
Incorrect deductions claimed
Scrutiny assessment
Demand for tax payment

Common Types of Income Tax Notices

1. Section 139(9) – Defective Return

Issued when the ITR is incomplete or has errors.

2. Section 142(1) – Inquiry Before Assessment

Asks for additional information or documents.

3. Section 143(1) – Intimation Notice

Sent after processing the ITR, showing refund, demand, or no demand.

4. Section 143(2) – Scrutiny Notice

Issued for detailed verification of income and expenses.

5. Section 148 – Income Escaped Assessment

Issued when income has not been disclosed.

How to Reply to Income Tax Notice Online (Step-by-Step)

Step 1: Login to Income Tax Portal

Visit 👉 https://www.incometax.gov.in

PAN
Password
Captcha

Step 2: Go to “e-Proceedings / Pending Actions”

Click on Pending Actions
Select e-Proceedings
Choose the notice you received

Step 3: Read the Notice Carefully

Check:

Section under which notice is issued
Assessment year
Due date for reply
Required documents

Step 4: Prepare Your Reply

Collect documents such as:

Form 16 / 16A
Bank statements
AIS / TIS
Investment proofs
Salary slips
Capital gain details

Write a clear and truthful explanation.

Step 5: Submit Reply Online

Upload documents (PDF format)
Add explanation in text box
Verify using Aadhaar OTP / DSC / EVC
Submit successfully

How to Reply to Income Tax Notice Offline

In rare cases where offline reply is allowed:

Draft a written reply
Attach self-attested documents
Submit to the Income Tax Office mentioned in the notice

Important Tips While Replying to Income Tax Notice

✔ Reply before the due date
✔ Provide accurate information only
✔ Do not ignore the notice
✔ Keep acknowledgment and reference number
✔ Seek professional help if notice is complex

What Happens If You Don’t Reply?

Failure to reply may lead to:

Penalty under Income Tax Act
Best judgment assessment
Tax demand with interest
Prosecution in serious cases

Can You Revise Your Reply?

Yes, in some cases, you can submit a revised response before final assessment. Always check portal status.

When Should You Consult a Tax Expert or Lawyer?

You should seek professional help if:

Notice is under Section 148 or 143(2)
High tax demand is raised
Income involves crypto, foreign assets, or business
You are unsure about documentation

Receiving an Income Tax notice is common and manageable if handled properly. Understanding how to reply to an Income Tax notice online ensures compliance and protects you from unnecessary penalties. Always respond on time, keep records, and consult experts when required.

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How to Reply to an Income Tax Notice in India ?