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Income tax assessment is the process through which the Income Tax Department checks the return you filed and decides your final income, tax, and refund. The department confirms that you have paid the right amount of tax, claimed valid deductions, and reported your income correctly.
Every taxpayer who files an ITR goes through some form of assessment. For most people it is a simple computer check. For a few, it becomes a detailed review.
The department carries out assessment to:
| Type of Assessment | Section | When It Applies |
|
Self-assessment |
140A |
You calculate and pay the tax yourself before filing the return |
|
Summary assessment (processing) |
143(1) |
Every filed return is checked by the computer system |
|
Scrutiny assessment |
143(3) |
The department picks your return for a detailed check |
|
Best judgment assessment |
144 |
You do not file a return or do not reply to notices |
|
Income escaping assessment (reassessment) |
147 |
The department believes some income was not reported |
| Point | Intimation 143(1) | Notice | Assessment Order |
|
What it is |
Result of computer processing |
Request for reply or action |
Final decision of the officer |
|
Sent when |
After you file your return |
When the department needs details |
After the assessment is complete |
|
Your action |
Pay, accept, or disagree |
Reply with proof |
Pay or file an appeal |
| Result | What It Means |
|
Return accepted as filed |
No change in income or tax |
|
Refund issued |
Tax paid is more than tax due |
|
Demand raised |
Tax, interest, or fee is payable |
|
Income increased |
Some income or claim is not accepted |
|
Deduction disallowed |
Proof is missing or the rule is not met |
|
Penalty proceedings |
Started if under-reporting or non-compliance is found |
| Case | Penalty Under Section 270A |
|
Under-reporting of income |
Under-reported income, 50% of the tax |
|
Misreporting of income |
200% of the tax on the misreported income |
Misreporting means false entries, wrong claims, or leaving out a transaction. Giving correct facts early helps you avoid the higher penalty.
You have these options:
| Option | When to Use It |
|
Rectification (Section 154) |
A clear mistake appears in the order, within 4 years from the end of the financial year of the order |
|
Revised return |
You found your own mistake and the last date is still open |
|
Appeal to CIT (Appeals) |
You disagree with the order, to be filed in Form 35 within 30 days |
|
Appeal to ITAT |
The first appeal did not give relief |
|
Stay of demand |
You want to avoid recovery while the appeal is pending |
Assessment work has strict time limits, and the reply you give decides the result. With CA Arpit Gupta, you get:
Do not wait for the last date to reply. Let an experienced Chartered Accountant study your case and handle the process for you.
Contact CA Arpit Gupta on Call or WhatsApp: +91-7081220600
Call now to book a consultation and get your income tax assessment handled on time.
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