Notices Under Section 143(1) and 143(2)

Timelines and procedures can change. This article is for general information and does not constitute tax advice.

Section 143(1): The Intimation Everyone Gets

This isn’t an adversarial notice; it’s the automated outcome of CPC processing a filed return, checking basic arithmetic, reconciling TDS against Form 26AS, and comparing against AIS and TIS. Virtually every filer receives one. CPC has 9 months from the end of the financial year in which the return was filed to issue it. It can confirm the return as filed, confirm and process a refund, or raise a demand. Where a demand is raised, not responding at all is generally treated as accepting it.

Section 143(2): The Scrutiny Notice

A genuine notice initiating scrutiny assessment. It has to be issued within 3 months from the end of the financial year in which the return was filed, not the income year, a distinction that trips up the timeline calculation more often than anything else. Selection happens through CASS (algorithmic) or CBDT’s compulsory scrutiny guidelines. Almost all of this runs through the Faceless Assessment Scheme. Ignoring a scrutiny notice risks a best-judgment assessment, typically less favourable than genuine participation would produce.

A Recent Procedural Change

Under the current framework, penalty proceedings now run simultaneously with the assessment, rather than as a fully separate, later process. Where penalty becomes a live issue, there’s a choice between applying for immunity from it or pursuing an appeal against the assessment, since the two routes are mutually exclusive.