Income Tax Notice 143(1) vs 143(2) vs 148: What Is the Difference?

Three section numbers turn up most often in income tax emails, and they mean very different things:

• 143(1) is the processing result almost every filer receives. Most of the time you only save the PDF.
• 143(2) means your return has been picked for scrutiny, a detailed examination. You must reply with documents.
• 148 means the department believes income escaped tax in an earlier year and is reopening it. Get a chartered accountant involved early.

The first thing to check is the subject line and the section quoted on the PDF, then the DIN (Document Identification Number). Every genuine notice carries one, and you can check it on incometax.gov.in under Authenticate notice/order issued by ITD without logging in.

At a glance

1. Section 143(1): the processing intimation

What it is

When CPC processes your return, it compares what you declared with its own computation, using Form 26AS, AIS (Annual Information Statement) and the schedules in your return. The intimation puts the two side by side: one column for your figures, one for CPC's.

It ends in one of three ways:

1. No demand, no refund. Your figures and CPC's match.
2. Refund. You paid more than you owed through TDS, TCS or advance tax. The refund is sent to your validated bank account, with interest under section 244A where it applies.
3. Demand. CPC's figure is higher than yours, for example because a deduction was disallowed, TDS did not match Form 26AS, or a tax payment you made was not claimed in the return.

A 143(1) intimation does not close the year. Your return can still be picked for scrutiny under section 143(2) within that section's own time limit.

Before CPC makes an adjustment that increases your income, it sends a communication of proposed adjustment under section 143(1)(a) and gives you 30 days to respond under Pending Actions > e-Proceedings. If you agree, the adjustment goes through. If you disagree and explain, CPC considers the reply before processing.

Time limit

The intimation must be sent within 9 months from the end of the financial year in which the return was filed. A return filed in July 2026 falls in FY 2026-27, so its intimation must be issued by 31 December 2027.

What to do

• No demand or a refund: download the PDF and keep it. The password is your PAN in lower case followed by your date of birth as DDMMYYYY, for example abcde1234f01011990.
• A demand you think is wrong: find out why first. If CPC did not give credit for tax already paid or TDS shown in Form 26AS, or there is an arithmetic error, file a rectification request under section 154 from Services > Rectification. If your own return had other mistakes (missed income, a wrong deduction) and the window for a revised return under section 139(5) is open, file a revised return. Both are valid, and you can use both where they fit. Meanwhile, record your view under Pending Actions > Response to Outstanding Demand.
• A demand you agree with: pay it through e-Pay Tax and mark it as correct in the response screen.

Our guide on a demand raised after you already paid tax walks through the rectification and revised return steps.

2. Section 143(2): scrutiny notice

What it is

A notice under section 143(2) says your return has been selected for scrutiny. It is handled under the faceless assessment scheme: everything happens on the portal, and you do not meet an officer.

Returns are picked through computer-assisted selection and specific risk parameters. Common triggers include a large gap between AIS and the return (share sales, property purchases, interest), deductions that look high for the income declared, and big swings in business turnover or profit.

Limited or complete scrutiny

• Limited scrutiny looks only at the issues named in the notice, for example the cost of a property you sold.
• Complete scrutiny can examine the whole return.

The notice says which one applies.

Time limit

The notice must be served within 3 months from the end of the financial year in which the return was filed. For a return filed in July 2026, that is 30 June 2027. A notice served after this date is not valid.

What to do

1. Open Pending Actions > e-Proceedings and read the notice and its questionnaire.
2. Reply by the date shown, uploading the documents asked for: bank statements, contract notes, sale deeds, ledgers, deduction proofs.
3. If you need more time, use the adjournment option on the same screen and give a reason.
4. Do not ignore it. Without a reply, the officer can complete a best judgment assessment under section 144 using whatever information the department has.

For anything beyond a single, simple issue, a chartered accountant's help is worth it. The replies form the record for any later appeal.

3. Section 148 and 148A: reassessment

What it is

Section 148 lets the department reopen an earlier year when it has information suggesting income escaped assessment, for example large cash deposits, a property purchase or share sales that do not appear in your return.

The process runs in order:

1. Show-cause notice under section 148A. The officer shares the information the department has and asks why the year should not be reopened.
2. Your reply, within the time stated in the notice. You can show the income was already taxed, was exempt, or belongs to someone else.
3. Order under section 148A. The officer decides, with reasons, whether it is a fit case to reopen.
4. Notice under section 148, if the officer decides to reopen, asking you to file a return for that year within the time stated.

Time limit

After the changes made by the Finance (No. 2) Act, 2024, which apply to notices issued from 1 September 2024:

• a year can generally be reopened only within 3 years from the end of the relevant assessment year
• it can be reopened up to 5 years from the end of the assessment year if the income that escaped is ₹50 lakh or more

The rules for calculating these limits have extra provisions for older years and for time spent on the show-cause stage. Check the dates in your notice with a professional.

What to do

• Reply to the show-cause notice with documents. This stage is often your best chance to stop the year being reopened.
• If a 148 notice follows, file the return it asks for within the time given, and keep replying to the proceedings on e-Proceedings.
• Penalties on reassessment can be significant: under section 270A, 50% of the tax on under-reported income, and 200% where income is misreported. A chartered accountant should handle this.

How the stages connect

Keeping notices to a minimum

1. Match your return with AIS before filing. Interest, dividends, mutual fund redemptions and property deals in AIS should all appear in the return, or you should know why they don't.
2. Claim every tax payment. Put each self-assessment and advance tax challan in Schedule IT. A missing challan is one of the commonest causes of a wrong 143(1) demand.
3. Act only on notices you can see on the portal. Faceless proceedings run through the portal. A phone call or email asking you to pay into a bank account is not how notices work; check the DIN.

If you file for several family members, myutils.me shows each PAN's ITR status, outstanding demands and AIS in one place after you add the PAN or press Sync, and fetches the 143(1) intimation PDF from the portal when you download it. It does not send alerts, so check e-Proceedings on the portal for notices.