Income Tax Notice: It is imperative that taxpayers check their AIS carefully and report the mismatches, if any, to the tax authorities
Income Tax Notice: In the event that the return of income (ITR) filed by the taxpayer does not match with the data appearing in the AIS, there are chances that the income tax department could send notice/s. AIS stands for Annual Information Statement. It is a detailed statement of transactions entered into by the taxpayer in a particular financial year.
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Anita Basrur, partner, direct tax, Sudit K Parekh & Co. LLP, said, “This statement includes not only income on which tax has been deducted but also includes details of other income such as dividend, interest on savings and fixed deposits, other interest, etc. whether or not tax has been deducted.”
Further, it also includes transactions carried out on the stock exchange such as purchase / sale of shares / mutual fund units, purchase of car, property transactions carried out, etc..
According to Basrur, if the information on the income tax return submitted by the taxpayer does not align with the data present in the AIS, there is a possibility that the tax authorities may issue the notices mentioned below;
Notice under section 133C of the Act:
The tax authorities are authorised to issue notice under section 133C of the Act for verification of information in its possession. This would include cases where an amount reported in AIS has not been considered as income at the time of filing the return of income. The taxpayer is required to furnish a response stating whether the said income pertains to himself / herself or whether the said income has been incorrectly reported under his / her PAN.
Notice under section 139(9) of the Act:
Since AIS contains information of income on which taxes have been deducted, any mismatch in the income considered in the return of income and that reported in AIS could lead to treating the return of income filed by the taxpayer as defective on the ground that income reported in the return of income is lower than that appearing in the AIS / 26AS.
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Intimation under section 143(1)(a) of the Act:
In cases where the taxpayer has claimed credit for taxes which are not appearing in the AIS/26AS, the tax authorities intimate the taxpayer through an intimation under section 143(1)(a) of the Act indicating the proposed adjustment.
Notice under section 143(2) / 148 of the Act:
In cases where the taxpayers have missed to file their return of income despite having taxable income, the tax authorities based on the AIS may initiate assessment / reassessment proceedings, as the case may be by issuing notice under section 143(2)/ 148 of the Act.
In light of the above, it is imperative that taxpayers check their AIS carefully and report the mismatches, if any, to the tax authorities (through the option available on the portal) so that the tax authorities can investigate the matter and take appropriate action.
In order to check the AIS data, taxpayer is required to follow the below steps:
Login to URL https://eportal.incometax.gov.in/iec/foservices/#/login
After login, click the e-File menu.
Click on Income Tax Return
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Click on View AIS.
Click on Proceed button which will redirect to AIS portal
Click on the AIS icon to view the Annual Information Statement.
