All about intimation u/s 143(1)

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All about intimation u/s 143(1)

All about intimation u/s 143(1)

– Rohit Sharma

 

What is intimation u/s 143(1)? Why intimation u/s 143(1) is issued? What to do after receipt of u/s 143(1)? This are the common question asked by various taxpayers.

Let us discuss about it.

Issuing intimation u/s 143(1) is the first steps by the income tax department after the return is received by it. It is nothing but the information of its processing so as to correct the arithmetical mistakes, internal inconsistencies, tax calculation and verification of tax payment.

At this stage, it is processed without any verification of income & other records of the taxpayers. It is completed now entirely through the computerized processing and there is no human interference involved in this process now. Intimation under section 143(1) is sent to a taxpayer only in case any tax or interest is found payable or refundable or there is any increase / reduction in loss.

WHAT TO DO AFTER RECEIPT OF INTIMATION:

After taxpayer received such intimation, it should first check it carefully against the data & figures as per income tax return filed. The intimation would contain the details of return filed by the assessee and the computation as done by the income tax department. The return filer is required to read, analyse &compare the data.

The result varies from case to case basis and generally there can be following three situations:

  1. No demand No Refund ( but resulting in any increase / reduction in loss)
  2. Demand Determined
  3. Refund Determined.

The detailed analysis of these three situations are as follows :-

  1. No demand No Refund (but resulting in any increase / reduction in loss)
    It is a case where the adjustments as referred to in section 143(1) have been made resulting in increase/reduction in loss declared by the taxpayer and no interest or tax is payable/ refundable  by/to the assessee.

  1. Demand Determined
    It is a case where any interest or tax is found payable on the basis of the return after making adjustments as referred to in section 143(1) and after giving credit to the taxes and interest paid by the taxpayer. In this case three situations will arise as (1) Agree with Demand (2) Disagree with Demand and rectification return filing required (3) Disagree with Demand and revised return filing required. Let us understand these situations in a bit detailed manner:

    I) Agree with Demand:

    If you agree with the demand, then you will be required to pay the amount of tax as per the intimation u/s 143(1). In this case, tax can be paid in the following ways. The Taxes can be paid by a taxpayer through any one of following modes:
    a.Through Bank (physical),
    b.Online payment.

    a.Payment Through Bank: The taxes due can be paid through specified branches of nationalized banks. A challan is required to be filed by taxpayer specifying his PAN, name, Assessment Year and amount of tax to be paid. You can get a blank copy of challan here.You should take a print of the same and after filling the details, submit the same to the bank.While filing the challan details, please tick on “Tax on Regular Assessment (400)”, under the head “Type of Payment”. Bank will return the challan to the payer after affixing its stamp as duly paid. The assesse is required to keep a copy of this challan for his personal record.

    b.Payment Through Online mode: If a taxpayer wishes to pay taxes online then he is required to follow some simple steps. Click here to know the steps for making online payment of  outstanding demand.

  2. II) Disagree with demand:
    It might happen that the taxpayer may forget to claim certain incomes or deductions in his Income-tax return. Sometimes the taxpayer may inadvertently claim certain incomes or deductions under wrong head, such issues are referred as “mistake apparent from record” as per the Income Tax Act. In this case there are two with you either to file revised return or rectification request.

    -Revised Return: Revised Return can be filed only if you have made any mistakes in your original income-tax return. In other words, revised return is filed to correct the mistakes committed in your original return.

    -Rectification return: Rectification return can be filed only if you find any error in the order passed by the Department.

  1. Refund Determined:
    It is a case where any interest or tax is found refundable on the basis of the return after making adjustments as referred to in section 143(1) and after giving credit to the taxes and interest paid by the taxpayer. In the intimation so received, refund amount may be same as shown in the return with interest on it or refund amount may be reduced due to some addition in the return on the basis of mistake apparent from the record. In case less refund amount is shown in the intimation than that shown in the income-tax return, then check your income tax return along with the intimation computation for any mistake in the return. On the basis of scrutiny of return you can decide in the following ways.

    a. Agree with less refund amount: After scrutiny of return, you may realize that the refund amount as shown as per intimation is correct, in that case, you need not do anything from your end.

    b. Disagree with less refund amount: If you disagree with the reduced or less refund amount then, you will be required either to file a rectification or revised return which will depend upon the scrutiny of your income tax return and intimation u/s 143(1).

    -Revised Return: Revised Return can be filed only if you have made any mistakes in your original income-tax return. In other words, revised return is filed to correct the mistakes committed in your original return.

    -Rectification return: Rectification return can be filed only if you find any error in the order passed by the Department.

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