As per latest amendments and provisions of the Income Tax Act, 1961 with the Assessment Year 2018-19, there are various new provisions related to income tax proceedings and assessment procedure being included. A new section has been inserted with the assessment year 2018-19 called as 143(1)(a). The provisions of Section 143(1)(a) provides that when an assessee files income tax return for the assessment year 2018-19 onwards, there has to be clarity on the data which is filing in the income tax return. The data should be very authentic.

Why and when a notice u/s 143(1)(a) is issued?
According to the provisions of the Income Tax Act, 1961 read with section 143(1)(a) where any assessee files its return of income not correctly and by mistakenly it provides the details of income and deductions, in such case the notice would be issued. Sometimes notices under Section 143(1)(a) are issued by Income Tax Department without detailed analysis. Following are some reasons by which notice can be issued:

When a difference of income arises in income tax return with the Form 16, Form 16A and Form 26AS in case of salaried income, Capital gain income.

Income is offered in the income tax return in a different head of income against the section under which TDS has been deducted. For instance TDS deducted u/s 194J and income is shown as Salary in the ITR.

When Business Receipts shown as gross level under the head “Income from business or profession” may not be comparable with the receipts shown in form 16, Form 16A and Form 26AS.

Any items related to P&L such as commission, interest, and revenue etc. shown as net income basis where as in Form16, Form 16A & Form 26AS shown it as gross income basis.

When deductions and exempt allowances claimed at the time of filing of ITR but not available in Form 16.

Income and receipts when offered in previous year and TDS is claimed in financial year, it can also be a reason of issuing the notice under this section.

When we accrue the income on FDR but not shown in the income tax return, due to this variation notice can be issued.

Income which is not taxable in India due to various reasons. For Instance in case of non-resident income would be exempt if in the countries there be DTAA exists.

How to respond

There is a online process to filing the response of the notice with the department. You have to follow the following procedure to make response with the department:
n First of all need to accumulate the return of income which is filed, relevant documents, Form 16A, Form 26AS and find out the reasons of issuance of notice.

Go to ‘e-Proceeding’ menu option and where as you will find ‘e-Assessment option.

After that, you will have to click on adjustments under section 143(1)(a).

After this you will find there are options on the online portal that you have to make response i.e. Agree, Disagree.

If you are agree with the demand or notice which is issued then necessary modifications and adjustment you have to do and have file a revise return with paying also additional tax which department demands.

If you are disagree with the adjustments, then you will have to file the valid reasons thereof of disagreeing of that notice or demand at the online portal.

Ganesh Kumawat is a chartered accountant
Source: Tax Guru