How to Respond to Notice u/s 143(1)(a) for A.Y. 2017-18?
In an earlier Post regarding Communication u/s 143(1)(a) for PAN XXXxxxxxXX for the A.Y. 2017-18 we had asked readers to wait for further clarity from Income tax department as was communicated by them through their helpline number – 18001034455.
But it’s more than 10 days now and there have been NO further clarification coming from department, we thought we should start responding to Proposed adjustment u/s 143(1)(a) of Income Tax Act, 1961 Notice.
The Section u/s 143(1)(a) existed earlier too but has not been used extensively by tax department. What has happened this time they are sending out notices even if there is slightest mismatch between Form 16, Form 16A and Form 26AS versus the return filed.
Even for deductions u/s 80TTA which exempts interest income up to Rs 10,000 in savings bank account which mostly do no figure out in Form 16 are receiving notices. The problem is we still do NOT know what proof tax department would require for this exemption.
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All pensioners who do not have to submit their investment declaration u/s 80C too are receiving this notice.
Other than that salaried employees who have not submitted their investment proofs or rent receipts to their employers and claimed such deductions at the time of filing the return are getting these notices.
The notice mentions that you should respond to the same within 30 days of receiving it. We list down steps you should follow to respond to the notice.
Step 1: Login to the efiling portal – incometaxindiaefiling.gov.in
Step 2: Goto e- Proceeding > eAssessment menu
For some tax payers this section may show nothing even if they have received notice. This is because it takes 2 to 3 days for the details to appear.
This is what is visible on clicking the above menu options.
Also Read: How are your Investments Taxed?
Step 3: Click on Prmia Facie Adjustment u/s 143(1)
This will open the next screen
Also Read: Best Tax Saving Investments u/s 80C
Step 4: Choose “Submit” to Direct to the next page
Step 5: Choose to Agree or Disagree
The details show the same details as present in the notice. Now you have to choose from “Response” – Agree or Disagree.
In case you agree which means the tax department was right in its calculation, you should submit the response and file a revised return within 15 days after paying additional taxes.
Also Read: How to file Revised Income Tax return?
Another thing to notice is if you agree it sums up the Variance – which is a bug in the system. Both the rows question the same exemption and hence it should have shown addition of Rs 1,59,000 only (as in the above example).
Also Read: How to pay additional Self-Assessment Tax Online?
However in most cases Taxpayer would disagree to the addition. So if you respond by choosing Disagree, an additional response table opens up at the bottom asking for more details.
The Form for reply is shown below:
The form has the following fields. Read carefully on what needs to be filled:
TAN
Deduction made under section
You’ll get the complete list from the ITR form you filled
Also Read: 21 changes in Income Tax laws in FY 2017-18
Amount paid/credited by deductor
Put the amount paid – you’ll get this from Form 16 or 26AS (shown below) for salaried and Form 16A or 26AS for interest income, etc.
Nature of receipt as per the deductor
This would be any of five types of income defined by income Tax – salary (Pension is salary income), Business, Capital Gains, income from house and other income (includes interest income)
Income/Gross Receipts as per the return
Enter the amount after taking on account the above deduction.
So for the case above I would put Rs 4,36,160 (5,95,156 – 1,59,000) which was the income filed in actual tax return
Head of Income/Schedule under which reported in the return
This should be same as “Nature of receipt as per the deductor” until you have put it differently in income tax return. For e.g. Pension income should be treated as salary income but someone unknowingly has put in other income. So in this case he has to fill “Other Income”
Head of Income/Schedule under which reported in the return IS ACCEPTING ONLY NUMERIC VALUE BUT YOU SAID IT IS SAME AS NATURE OF RECEIPT. So you’ll have to put following numbers (Sections) as the case may be:
This idea came from comment from Sagar (Thanks Sagar)!
Also I am surprised how tax department thinks all taxpayers would know these sections. If it was just 5 they should have given a drop down rather than fill numbers only!
Also Read: When and How can Tax Benefits Claimed Earlier be Reversed?
Reason
There are 10 reasons to choose from as shown below:
In case you claimed HRA which was not present in Form 16 then select reason as “Allowance exempt claimed in return but not in Form 16”
Also Read: How to claim Tax Benefit on both HRA & Home Loan?
For all deductions under chapter VIA (includes 80C, 80D, 80E, NPS related etc) which you claimed but were not part of Form 16 select “Deductions claimed in the return but not in Form 16”
In case everything was present in your Form 16 but still you got notice select “Others” and mention in Justification that the deduction already present in Form 16. Also attach the Form 16.
Justification/Remarks
Briefly state why your Allowance or deduction was not in Form 16. It could be “employer did not consider this deduction” or “investment was made after proof submission to employer” etc.
And most important DO NOT forget to attach relevant documents.
Section 143(1) Acknowledgement
After all the process is complete you get the following acknowledgement:
Disclaimer: Please remember this post is best to my understanding and I am not a tax expert. You might want to consult a qualified tax consultant or CA for your specific case!
This action was initiated by income tax department as some tax payers misused the “proof not required while filing tax return” part and used to claim deductions they were not eligible for. For e.g. with more strict polices at employer end many people could not claim HRA with fake receipts as rent receipt without landlord PAN in not accepted. But they claimed while filing ITR as this is allowed. We all know there are a lot of genuine tax payers who are not able to claim HRA as landlords DO NOT share their PAN number. Also some tax payers took advantage of 80C without making actual investment.
The intent of income tax department was good – to weed out such events. But unfortunately as we have seen with mot government initiatives – the plan is good on paper but execution is very poor. Same is the case here.
Even tax helpline is NOT able to guide people and telling them to wait. Also this should be stated while filing returns and not sending a notice after that. This would badly hurt people who are not tech savvy and do not check emails frequently & this means a lot of housewives, senior citizens on pension income.
Also sending notice for Section 80TTA – deduction up to Rs 10,000 for interest earned in savings account is ridiculous because I do not understand what proof would be required for the same.
Also Read: 25 Tax Free Incomes & Investments in India
The e- Proceeding form has bugs and it adds income across rows – as shown above. The department has still not corrected these and neither sent further communication. On one hand they want more and more people to file returns by telling it’s simple and then bowl a googly by sending such notices. Hopefully the tax department is working on it and would create more awareness on how to reply to these notices or at the end its tax payer would be sufferer.
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View Comments
Hi Mr.Amit,
Request to suggest for notice received under section 143(1)a:
1.fyi the notice I have received is the difference amount of exempt income declared which is not mentioned in my form 16. 2.My exempt income declared in ITR-1 is under others-Gift, Tax free bonds interest and PPF interest received. So can you suggest do I need to fill three separate rows individually explaining reasons for three different exempt income or everything in one row?
3.if everything in one row then how do I explain different reasons of exemptions, please sugeest.
4.Suppose in one row then what do I mention under - Amount paid/credited by deductor for my salary and fd interest and other income, also under Nature of receipt as per the deductor-for my salary, fd interest and other income.
5.For attaching file - can I attach bank passbook scan copy for Tax free bonds interest received, PPF pass book for interest received and how do I attach proof for Gift amount received, please suggest, thanks
Hi Amit, Thanks for ur detailed information. It is really helpful. I have couple of doubts listed below:
1. In the section 'Amount paid/credited by deductor': Do I need to enter the gross salary (say 8,00,000/) or gross income (i.e Gross salary- allowannce u/s 10= say 7,50,000/) ? Moreover, during filling tax return, I entered 7,50,000/ as income from salary.
2. In the section'Income/Gross Receipts as per the return': Do I need to enter the taxable income i.e. Gross salary- (allowance u/s 10 + 1.5 lack u/s 80C + 50k u/s 80CCD(1B) + 5000 u/s 80 TTA)= 8,00,000-(50000+150000+50000+5000)= 5,45,000/. Therefore do i need to enter 5,45,000/ ?
Notice 143(1A) sent to me because of form 16 deduction mismatch, I applied for deduction of 50k u/s 80CCD(1B) & 5000/ under 80 TTA( for my 4 savings a/c). Now do i need to enter them in separate row? Can I attach two separate docs, one for each?
Plz help me.
1. Enter the salary you entered while filing return
2. Accordingly above salary - all exemptions u/s 80C, 80CCD
I think even if you have multiple rows, only one attachment field is present. SO zip all files and attach. NPS statement should be sufficient. I am not sure what to attach for 80TTA as its too cumbersome for people with multiple accounts. Also government has never stated that it needs proof for 80TTA.
Thanks Amit. Its rellay helpful. Now the worst kind of tax terrorism I am facing. Entered all & merged 2 docs in a single PDF, choosing file to upload and then when submitting it not accepting & showing invalid input & the uploaded doc gets deleted from chosen file option. What to do now?
Amit finally I could submit my response. Their helpline no r all bogus.They dont knw anything. I written a mail to them & they replied saying 'Do not use special characters (Example :~,@,#,$,%,^,&,*.(,),") and Double Spaces. Copy and Paste option is not allowed in "Form filling"'. It instantly worked. Thanks a ton becoz of u I could get relief. Thanks once again
Heard the same problem from others too... Wait and try again is best we can do.You might want to tweet to finance minister/PMO in case you think they would pay heed to it!
Sir,
We have filed a response u/s 143. Some deductions u/s 80C were claimed in return but was not part of Form 16. At the time of filing response there were two lines for Agree/ Disagree. In first line we correctly selected Disagree but in second line by fault Agree got selected. We have given complete justifications and proofs also. How can we change/ revise reply to mention Disagree for both lines.
I don't think you can change the response now. I would suggest to file revised return.
I am a salaried employee.
I got a TDS deducted by bank, for interest earn on FD, but forgot to add it in "Others Income" during filling. I got the notice of mismatch income.
What shall I do now?
1. Agree the addition for all the cases and then, resubmit the ITR, OR
2. Disagree and fill the "Reason for disagreement" with the details of TDS by bank?
Please help.
Agree and file revised return.
Hello Team,
I have doubt about e-proceeding. I have two Form 16 for FY 16-17. i have not submitted the proof of investment (LIC) under 80C deduction to both the employer.
Now while filing ITR, I have add investment amount under 80C deduction.so I received Intimation 143(1)a for Adjustment in income. I want to disagree with this so selected “Disagree” option.
Now my doubt is what needs to be filled in following column:
1) TAN number -- which employer tan(1st Employer or 2nd employer) number i should choose
2) Amount paid/credit by deductor – This would be amount paid by 1st Employer/2nd employer or Total amount paid by both employer
3) Income/Gross Receipt as per Return – This would be gross given by 1st employer/2nd employer or total gross by both employer
Please help me out.
Thanks,
Mayank Gupta
Choose any 1 employer (where the income is more than 1.5 lakhs) and fill corresponding details.
I have income from salary as well as interest on multiple savings bank accounts. I have received the communication with a gap of Rs 10000 in my taxable income. I assume this is because of the 80TTA deduction that I reported in the return.
I decided to disagree in the response.
Questions:
1. Do I need to add any row for 80C deduction ? Or just one row for 80TTA should be fine ?
2. Amount paid/credited by deductor: Should I copy the amount from 26AS ?
3. Nature of receipt as per the deductor: Should I write "Salary + Other Income" or just "Other Income" ?
4. Income/Gross Receipt as per return: Should I write the net taxable income from my earlier ITR1?
5. Head of Income/Schedule under which reported in the return: Should I write 17 or 56 ? Does it accept "17, 56" ?
Hi, thanks for your help
I have a question - If one revises the return , is it still necessary to do anything under e-proceedings ? The communication clearly states revise return OR submit response.
:) I am not sure but if you want to revise return I would recommend to agree and then revise your ITR.
Any information on what proof to submit for 80TTA claims.? Please help here.
I am not sure what to attach for 80TTA as its too cumbersome for people with multiple accounts. Also government has never stated that it needs proof for 80TTA.
I got 143(1)(a), this is regarding..
80TTA for interest income...
Question : If interest is earned from more than 1 bank then how to do ? Can I add two rows and fill according to Form 26A ?
80DD : For Disable dependent
Question : This certificate I couldn't submit to my employer. Can you please let me know what entries to be filled for each columns in response like TAN...etc
For 80TTA - I don't think you require any proof
80DD - All details related to employer as this was suppose to go in Form 16
Hi Amit,
In case of 80TTA, If I have interest from two banks then do we need to add two TAN from banks. This is
confusing...
As you mentioned , for 80 DD, details related to employer but document was not submitted and is it ok? please confirm.
See for 80TTA there might now be any proof required as there are no guidelines to the same. You can also use your employer TAN for the same.
For 80DD you need to use your employer TAN as the relevant deduction should have been part of Form 16 (had you submitted the same on time to them)
What in case where section 80C deduction as per Form 16 is correct but when I filed the return I made a mistake.
Let say I have mentioned Rs. 150000 as 80C deduction in my return whereas the form16 is correct which is Rs. 75000.
How to respond in this case, because in this case I need to agree to one (wrong 80C deduction) and disagree to increase in total income for which TDS is already paid (salaried employee) as per form16.
Do I need to agree to both?
Agree and revise your returns.