How to Response Income Tax Notice

If there is a discrepancy between the income tax amount calculated and paid by the taxpayer while submitting an income tax return (ITR) and that computed by the department, the income tax department will give a tax demand notice to the taxpayer. The taxpayer will get the tax demand notice after the ITR has been processed by the tax department.

An email and SMS will be used to notify you of the change in compliance with section 143(1) of the Income-tax Act of 1961. You can find the tax demand notification in your account on the government's website for electronic filing.

According to the most recent income tax legislation, you have 30 days to respond to this. The department will proceed with the suggested adjustment to your total income as specified in the notice provided in line with Section 143(1) of the Income-tax Act if you don't respond to the notification within the allotted time period. A tax demand is treated as a Notice of Demand under Section 156 if it is made in accordance with the notification requirements of Section 143(1). Therefore, you are required to make the full payment by the deadline stated in the notice.

If the individual to whom the section 156 tax notice for demand has been sent misses the payment date, the assessee is liable for the following penalties:
Interest under Section 220: Interest at the rate of 1% per month, or a portion thereof, is due after the 30 days allowed by Section 156 of the tax notice have passed.
A penalty under Section 221 may be imposed on the assessee by the assessing officer.

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