Income Tax Notice Complete Guide after Income Tax Act 2025
Here are the various types of income tax notices categorized by their function:
1. Notices for Assessment and Reassessment
- Section 268(1) Notice (Inquiry before assessment): This notice is issued to require an assessee to furnish a return of income, especially if they have not filed their return within the allowed time or to provide specific particulars required for making an assessment.
- Section 281 Notice (Show-Cause for Escaped Income): A mandatory show-cause notice issued by the Assessing Officer (AO) accompanied by information suggesting that income has escaped assessment, asking the taxpayer why a formal reassessment notice should not be issued. If the AO has information suggesting that your income chargeable to tax has escaped assessment for a relevant tax year, they cannot immediately demand a new tax return. Instead, they must follow procedure to issue Show Cause Notice refer Income Tax Notice Section 281 Income Tax Act 2025
- Section 280 Notice (Income Escaping Assessment): Following the Section 281 show-cause procedure, this is the formal notice issued to compel the taxpayer to furnish a new return for income that has escaped assessment.
- Section 294(1)(a) Notice (Block Assessment for Search/Requisition): Issued when a search is initiated or assets are requisitioned, requiring the person to furnish a return setting forth their undisclosed income for the block period within a specified time not exceeding sixty days,.
| 1961 Act (Old) | 2025 Act (New) | Purpose |
|---|---|---|
| Section 148A | Section 281 | Show-Cause Procedure: Opportunity to explain before reopening. |
| Section 148 | Section 280 | Reassessment Notice: Mandatory minimum 30-day time to reply. |
| Section 149 | Section 282 | Time Limits: Reassessment can be initiated up to 3 yrs 3 mo (normal) or 5 yrs 3 mo (serious). |
Note: Even after April 2026, any pending proceedings initiated under the old Act will continue to follow the old section numbers (148A) until they are closed.
Under the Income-tax Act, 2025, there are several types of notices issued by income-tax authorities for various purposes, ranging from routine inquiries to demands for tax recovery and block assessments.
2. Notices for Demand and Recovery
- Section 289 Notice (Notice of Demand): Issued (typically in Form 103 or Form 151) when any tax, interest, penalty, fine, or other sum is payable by the assessee as a result of an order passed under the Act,,,.
- Section 290 Notice (Modified Notice of Demand): If a previously issued Section 289 demand is reduced as a result of an order by the Adjudicating Authority under the Insolvency and Bankruptcy Code, 2016, the AO will issue a modified notice of demand,.
3. Notices for Information, Evidence, and Audit
- Section 246(1) Notice (Production of Evidence): A notice requiring a person to produce, or cause to be produced, books of account, documents, or information in electronic form/computer systems for a proceeding,.
- Section 259(1) Notice (Power to Call for Information): A notice issued by a prescribed income-tax authority requiring any person to furnish information that may be useful for, or relevant to, any inquiry or proceeding.
- Section 268(5) Direction/Notice: A notice from the AO directing the assessee to get their accounts audited or their inventory valued by an accountant or valuer,.
4. Special Procedural Notices
- Section 274(2) Notice: Issued by the Principal Commissioner or Commissioner setting out the reasons and basis of their opinion (for instance, declaring an arrangement as an impermissible avoidance arrangement) and allowing the assessee to submit objections within a period not exceeding sixty days,.
- Section 287(4)(a) Notice (Intention to Amend): If an income-tax authority intends to amend an order (such as rectifying a mistake that enhances an assessment or reduces a refund), they must first issue a notice of their intention to make such an amendment and provide a reasonable opportunity to be heard.
- Section 351 / Section 332 Notices: Notices issued by the Principal Commissioner or Commissioner to a registered non-profit organization calling for documents, information, or inquiry regarding specified violations of their registration conditions,.
Related Post
Section 246 Income Tax Act 2025 Power regarding discovery, production of evidence, etc.Section 246 Income Tax Act 2025 Power regarding discovery, production of evidence, etc.
Section 259 Income Tax Act 2025 Power to call for information by prescribed income-tax authority.
Section 268 Income Tax Act 2025 Inquiry before assessment.
Section 280 Income Tax Act 2025 Issue of notice where income has escaped assessment.
Section 281 Income Tax Act 2025 Procedure before issuance of notice under section 280.
Section 287 Income Tax Act 2025 Rectification of mistake.
Section 289 Income Tax Act 2025 Notice of demand.
Section 290 Income Tax Act 2025 Modification and revision of notice in certain cases.
Section 294 Income Tax Act 2025 Procedure for block assessment.
Section 332 Income Tax Act 2025 Application for registration.
Section 351 Income Tax Act 2025 Specified violation.