If you’ve been searching on Google to understand what a notice under section 142(1) is and aren’t finding relevant answers, let me help you. In this blog post, I’ll explain what this income tax notice is, the purpose of issuing such notices, and how to handle them.
Hi, I am CA Arun Tiwari. I am a tax litigation expert and have been handling income tax and GST notices for the last nine years. I have also filed several appeals, so I believe I am qualified to answer this question.
Watch this Informative video!
In this article, we will discuss about...
What is an Income Tax Notice Under Section 142(1)?
When you search on Google, you may find some information, but I’ll explain it in simple terms. Generally, a notice under section 142(1) is issued when the income tax officer is not satisfied with your income tax return. This notice can be issued in two situations:
1. You Have Not Filed Your Income Tax Return: If the income tax officer believes that you should have filed a return but haven’t, they will issue this notice. In response, you must file a proper income tax return.
2. You Have Filed Your Income Tax Return, But It Is Incomplete: If the officer thinks that your filed return is incomplete or some income has been omitted, they will issue this notice requesting additional information and documents to verify your return’s accuracy.
Consult CA Arun Tiwari for more information ay 📞 8080088288 or cs@aktassociates.com
Should You Be Worried About This Notice?
Yes, receiving this notice means that the income tax department has found something significant. They typically issue notices when they believe there is at least one lakh rupees of income that has been omitted. Therefore, you should carefully check the reason for the notice.
What to Do If You Receive a Notice Under Section 142(1)?
Here’s what you should do based on the two situations mentioned:
If You Have Not Filed a Return
- File a Proper Return: After thoroughly checking all details, file a proper return. It’s advisable to seek professional help to ensure accuracy and avoid penalties.
- Ensure Accuracy: Since you are already under the income tax department’s scrutiny, filing an incorrect return could result in substantial penalties.
If You Have Filed a Return but It Is Incomplete
- Review Your Computations: Submit all necessary documents, such as bank statements. Prepare a revised return and compare it with your original return to ensure no income is missed.
- Include All Income Sources: This might include dividend income, interest income, income from the sale of shares, or property that was omitted in the original return.
Handling Income Tax Notice Under Section 142(1)
For the first situation, if you haven’t filed a return, ensure that you file a proper return with the help of a professional. Professionals may charge a fee, but they will help ensure that the return is filed correctly, preventing further issues.
For the second situation, if your filed return is incomplete, a professional can help you prepare and submit the correct documents. If there is any additional tax liability, paying it promptly will satisfy the income tax officer and avoid unnecessary penalties.
Why Professional Help is Crucial
Professional help is essential because any submission to the income tax department becomes part of the official record, and errors can lead to significant penalties under section 271C. Don’t try to handle it yourself if you’re unsure; professionals can easily resolve these issues. Once proceedings start, they are similar to judicial proceedings, so you must be accurate and truthful in all submissions.
Conclusion
If you receive a notice under section 142(1) and need professional consulting, you can approach us. For simple questions, you can leave a comment. Handling tax matters can be complex and stressful, but with the right guidance, you can navigate these issues smoothly.
To sum up, a notice under section 142(1) indicates that the income tax department has found discrepancies in your tax return or believes you should have filed one. It’s crucial to address this notice promptly and accurately, preferably with professional assistance, to avoid penalties and further complications.