23 Feb

Income tax section 143 (1)

Income tax section 143 (1)

Taxpayers are somewhat annoyed when they hear the words tax, tax return. If there is any notice from the Income Tax Department, this displeasure turns into fear. Taxpayers are frightened by any notice or letter from the Income Tax Department. However, the Section 143 (1) notice means there is no need to worry.

1. Letter of Intimation u / s 143 (1)

The income tax return can be filed voluntarily as per section 139 of the Income-tax Act, 1961 or it can be demanded from the Income-tax department as per section 142 (1).

Preliminary assessment of all returns is done by the income tax department after filing the return by the taxpayer. The information or information received by the taxpayer in this regard after completion of the preliminary verification is called information or information received by 143 (1).

• Preliminary verification is done entirely by computer.

Due to the increase in the number of returns, the entire process of preliminary verification of returns (e-returns and papers) has been carried out at CPC Bangalore as per the advice of the Technical Advisory Group.

No person is involved in this process. This speeds up the initial verification and reduces the workload on the income tax department.

2. Preliminary verification

• It verifies the information filled in by the taxpayer and the information available with the income tax department through a computer or system. E.g. Form 16, Form 26AS and AIS, TDS information obtained through a bank, etc.

• If any errors are found in it, it is recorded in the system. This whole process runs according to the program in the computer, that is, the system is generated.

After filing the return by the taxpayer, the information about income or loss is checked by computer with the information of the taxpayer which is available with the income tax department. The taxpayer is informed by comparing the two.

It consists of two columns - the first is the information filled by the taxpayer and the system-generated information as per clause 143 (1). In it, while checking information


o Income from various sources

o Total income

o Deductions as per Chapter VIA Section 80C, 80D, etc.

o Tax deducted at source

o Advance tax (tax payments by taxpayers in the form of advance tax and self-assessment tax.)

Verification is done based on all the above points.

Final tax liability or refund is decided after all verifications as per section 143 (1).

In this regard, the taxpayer is notified in writing or electronically (email). The response must be received from the taxpayer within 30 days from the date of issue of the notice. In the case of non-receipt, the final liability is decided based on preliminary verification under section 90/91 and the relevant information is prepared and reported to the assessee.

• Final tax liability is determined by considering TDS and tax payment and other reliefs mentioned in section 90/91.

This includes the following instructions

·        No liability or refund

·        Taxation and its amount

·        Refund and its amount

When the amount of tax liability is demanded from the taxpayer, it is his final liability. Also, the refund amount is refunded to the taxpayer along with interest.

3. Adjustments made under Section 143 (1)

·        Adjustments to be made under section 143 (1) in determining total income and loss.

·        Arithmetical error in the return when calculating the return or calculating in the wrong place

·        Under false income or wrong claim when making a claim

·        Carry forward of loss claim of the previous year made after the due date

·        Returns that appear in the audit report but are not specified

4. Duration

Notice of return as per section 143 (1) is sent within one year from the end of the financial year for which the return has been filed.

• If the taxpayer does not receive any notice during the year, then there is no change in the same tax liability and refund and the returns filed by him are valid.

5. The role of the taxpayer after receiving the notice under section 143 (1)

        First of all, understand the instructions properly and verify the relevant documents.

Re-check the information in the instruction e.g. Name, address, PAN number, assessment year, an acknowledgement number of e-filing, etc.

        If the taxpayer notices errors in filing the return, correct them immediately and file the revised return.

        If the taxpayer does not find any error in his return form and the taxpayer does not agree with the notice received or does not notice exactly what went wrong, then he should apply in this regard as per section 154 (1) to rectify the errors indicated by section 143 (1).

·        If the taxpayer agrees to these adjustments, he is obliged to pay the additional tax amount indicated by the Income Tax Department.

·        When paying tax in this section, select the option of 'Regular Assessment (400) Tax' according to the type of payment in the currency type.

·        If the taxpayer does not agree with the notice given by section 143 (1) or correction of errors, he should contact the concerned Assessing Officer in this regard.

·        If it has not been admitted by the concerned Assessing Officer, a complaint should be lodged with the Lokayukta of the Income Tax Department.



Santosh Patil


Alliance Tax Experts Pvt Ltd



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