Income Tax Assessments and Appeals from first notice to the Tribunal.
Received a notice like this? We advise and represent tax-payers through scrutiny, reassessment and appeals, on a retainer or assignment-wise basis.
Your questions, answered in order
Why has my return been picked up?
Most are not. Here is what can happen.
- 1Summary assessmentAbout 98% of returns get only this quick check.
- 2Limited scrutinySpecific points, such as cash deposits or share premium.
- 3Complete scrutinyThe entire books of accounts are examined.
- 4ReassessmentIncome said to have escaped, reassessed after an inquiry and hearing.
What the law says
- Faceless assessments leave no room for personal argument or persuasion.
I have received a notice. What will Entrecap do?
Six things, in this order.
- 1Check the noticeWe test it and challenge invalid ones.
- 2Respond on timeWe track deadlines and seek adjournments.
- 3Share what is relevantWe submit only what is asked, after your approval.
- 4Back it with case lawWe build every reply on case law.
- 5Put it all on recordWe set out the full facts and grounds in writing.
- 6Plan strategy and costWe advise on how to conclude, and what it costs.
What the law says
- A notice must come from the competent officer, within time, or the proceedings are void.
- Late replies invite best-judgment assessments and penalties.
- Give what is asked for, but nothing in excess.
- Every point must be on record for later appeals.
This is how a nil-addition order reads.
Names, numbers and addresses are removed.
details removed
- 1Section 143(3) means the scrutiny assessment is complete.
- 2Limited scrutiny: only the issue named was examined.
- 3No addition. Assessed income equals returned income.
The order went against me. Can I appeal?
Yes, in two stages.
- 1First appeal: CIT (Appeals)We draft and represent the appeal.
- 2Second appeal: TribunalWe prepare the filing and represent you.
What the law says
- The CIT (A) rarely gives substantial relief, so relief is usually sought at the Tribunal.
- The Tribunal is the final fact-finding authority, and the most important stage.
Can I go to the High Court or Supreme Court?
Only in limited cases.
- 1When it is allowedA substantial question of law, a writ petition, or perverse treatment of facts.
- 2Our roleWe represent up to the Tribunal and advise on whether to go higher.
What the law says
- Each stage carries a cost, so higher-court appeals need careful judgement.
Section finder1961 Act → 2025 Act, for every provision on this pageClick to read furtherClose
Tax years from 1 April 2026 fall under the 2025 Act; earlier years under the 1961 Act.
We Are What Our Clients Say About Us
“Income Tax Team of Entrecap handled tax scrutiny matter and resulted in absolute favourable outcome. They prepared comprehensive reply to the income tax notice, included case laws and reasoning based on law. They sent to us for approval for uploading. Their timely intervention helped to avoid adverse judgment and helped us to claim full refund. Very happy with their work.”
“We had consulted Entrecap’s Direct Tax Team for income tax scrutiny of one of our clients. They handled the matter to our satisfaction, They had clear idea of the law and how to present the facts and grounds before the officer. We would recommend Entrecap for income tax assessment and appeal matters.”
I received a notice under section 143(2). What does it mean?
It means your return has been selected for scrutiny, and the assessing officer will examine it in detail. It is not an allegation of wrongdoing — it is the first step of a scrutiny assessment.
The notice sets out what is required and the date by which you must respond. Do not ignore it: keep a copy, note the due date, and send it to us as soon as it arrives.
What is the difference between limited and complete scrutiny?
- Limited scrutiny — the officer examines only the specific issues flagged in the notice, such as cash deposits, share application money or a mismatch between GST and income-tax data.
- Complete scrutiny — the entire return and books of account can be examined.
The notice or its covering note usually tells you which of the two applies.
How long do I have to reply to a notice, and can I ask for more time?
Every notice states its own due date, and that date is the one to work to. If the information needed will take longer to assemble, a request for an adjournment or extension can be made on the portal before the due date, with reasons. Whether it is allowed is the officer’s decision, so it is safest to plan the reply from day one.
How do I respond to a notice on the income-tax portal?
Notices are issued electronically. They appear under e-Proceedings on your portal account and reach your registered email. Under the faceless system, replies and documents are uploaded online — you do not visit an officer.
Each communication carries a Document Identification Number (DIN), which you can verify on the portal. We handle the upload, track every hearing date and keep a record of each submission.
What documents will the officer usually ask for?
- Bank statements and an explanation for large cash or other deposits.
- Books of account, ledgers and invoices.
- Loan, share application and advance confirmations.
- GST returns and reconciliation with the income-tax return.
- Details of expenses claimed, and proof of the income shown.
The exact list depends on the issues in your notice, and we prepare it in that light.
What is a scrutiny assessment, and why was my return picked?
Most returns are processed without a detailed look. A scrutiny assessment — under section 143(3) of the Income-tax Act, 1961 — is an in-depth examination of a return that the department has selected.
Selection can follow risk parameters, a mismatch with information the department already holds (such as AIS data), or specific inputs received. Being picked does not mean something is wrong, but it does mean the file deserves a careful, well-documented response.
What is the difference between an intimation under section 143(1) and a scrutiny assessment?
An intimation under section 143(1) is the department’s automated processing of your return: it shows whether tax, a refund or no change is due. No officer has examined your books at that stage.
A scrutiny assessment under section 143(3) follows a notice and a detailed examination. Both sit in section 270 of the Income-tax Act, 2025, which applies to tax years beginning on or after 1 April 2026. Earlier years continue under the 1961 Act.
What is reassessment under section 147, and when can it be started?
Reassessment is the reopening of an assessment already completed, because the officer believes some income has escaped assessment. The procedure runs in stages: a preliminary inquiry and show-cause notice under section 148A, your reply, the officer’s order, and only then a notice under section 148. Sections 279 to 281 of the Income-tax Act, 2025 carry these provisions forward.
The law sets time limits that depend on the amount of income said to have escaped. A notice outside those limits can be challenged.
I received a notice under section 148A. What should I do?
Treat it as the most important stage of the reassessment. The notice states the information on which the officer relies and invites you to show why the case should not be reopened.
A timely and well-reasoned reply often ends the matter here. We review the information, reconcile it with your records, and prepare a reply before the due date.
Can a reassessment notice be challenged?
Yes. The common grounds are that the notice was issued beyond the time limit, that the proper procedure under section 148A was not followed, that the required approval was missing, or that the information relied on does not support the belief that income escaped. We review the notice on each of these points before deciding how to proceed.
Who hears the first appeal, and what is the deadline?
The first appeal goes to the Commissioner of Income-tax (Appeals), the CIT(A), under section 246A of the Income-tax Act, 1961 (section 357 of the 2025 Act).
The appeal is generally to be filed within 30 days of receiving the order or the notice of demand. A delay can be explained to the authority, but it should not be relied on. Send us the order as soon as you receive it.
What happens if I am not satisfied with the CIT(A)’s order?
The second appeal goes to the Income Tax Appellate Tribunal under section 253 (section 362 of the 2025 Act), generally within 60 days of receiving the CIT(A)’s order. The Tribunal is the last authority on questions of fact.
A further appeal on a substantial question of law lies to the High Court under section 260A, generally within 120 days, and then to the Supreme Court under section 261.
Do I have to pay the demand while my appeal is pending?
Filing an appeal does not by itself stop recovery. You can apply for a stay of the demand, and in practice the department usually expects a part of the disputed demand to be paid — commonly 20% — while the appeal is decided. We make the stay application and, where it is justified, argue for a lower deposit.
Can an error in an assessment order be corrected without filing an appeal?
Yes, where it is a mistake apparent from the record — for example, a calculation error or a credit that was not given. A rectification application under section 154 is made to the same authority. It is quicker than an appeal, but it covers only clear mistakes, not disputed views.
What does Entrecap do on an assessment or appeal?
We read the notice, plan the response, assemble the documents, file replies on the portal and attend e-hearings. If an appeal is needed, we draft and file it before the CIT(A) and the Tribunal, and appear for you. Every matter is handled by our Chartered Accountants, and we keep you informed at each step.
Do you work on a retainer or assignment-wise?
Both. A single notice or appeal can be taken up assignment-wise. If you expect continuing correspondence with the department, a retainer is usually better value. The scope and fee are agreed before work begins.