Income Tax Notice Under Section 142(1)

A notice under Section 142(1) is an "inquiry before assessment" notice issued by the Assessing Officer to gather information before completing your assessment. It is a routine procedural notice, not an allegation of tax evasion, and can be issued whether or not you have filed your return. Section 142(1) sits between filing and assessment: it lets the Assessing Officer ask you to file a missing return, or to substantiate a return you have already filed, before the department decides whether to accept it or move to scrutiny.

A Section 142(1) notice, often written as a notice u/s 142(1), is one of the most common income tax notices a salaried taxpayer or small-business owner meets, and it lands on the e-filing portal for assessment year AY 2026-27 like any other. Read it as a request the Assessing Officer (AO) needs answered, not a verdict. It differs from a Section 143(1) intimation, the automated summary the department generates after processing your return, and from a Section 143(2) scrutiny notice, which issues only after a return is filed and the case is selected for detailed examination. Because a 142(1) inquiry can precede and even trigger scrutiny, a clean, complete response keeps the matter at the inquiry stage.

Section 142(1) has two limbs: clause (i) can require you to file a return if you were liable but have not filed one; clauses (ii) and (iii) can require you to produce accounts and documents or to furnish information in writing, including a statement of your assets and liabilities. The Assessing Officer commonly asks for:

• bank statements for the year;
• deduction proofs (PPF, LIC, ELSS, 80C/80D receipts);
• capital-gains computations;
• purchase/sale deeds;
• business books of account;
• a reconciliation of your return with the Annual Information Statement (AIS), the Taxpayer Information Summary (TIS) and Form 26AS.

You must supply what is asked even if you think it is irrelevant; relevance is the AO's call, not yours.

Clause (i) of Section 142(1), the sub-clause cited as 142(1)(i), covers the missing return; clauses (ii) and (iii) cover accounts, documents, and information, and the statement of assets and liabilities under clause (iii) can be called for only with the prior approval of the Joint Commissioner. Two related sub-sections sit alongside it. Section 142(2) lets the Assessing Officer make such inquiry as he considers necessary beyond what you filed. Section 142(3) protects you: you must be given an opportunity to be heard on any material gathered under 142(2) or (3), except in a best-judgment assessment under Section 144. If the notice is the file-a-return limb because your filing is missing or defective, treat it like a defective return notice under Section 139(9) and file first.

The time to respond to a Section 142(1) notice is the period specified in the notice itself; the Assessing Officer fixes it, and it is commonly 15 days (sometimes up to 30). There is no single statutory response window, so always read the deadline printed on your notice and reply through e-Proceedings before it. On the issue side, two limits apply: for the accounts limb, the Assessing Officer cannot require accounts relating to a period more than three years before the previous year (proviso to Section 142(1)); the return-filing limb carries no fixed outer date and is bounded only by the assessment-completion limit under Section 153.

To respond to a Section 142(1) notice, log in to the income-tax e-filing portal, open Pending Actions → e-Proceedings, select the 142(1) notice, and submit your reply with the requested documents as PDFs before the deadline. The core steps:

1. Authenticate first. Before you act, authenticate that the notice is genuine: check the DIN and use the department's service to authenticate the notice / check it is genuine.
2. Reconcile. Match your return against the Annual Information Statement (AIS), TIS and Form 26AS, and where the figures are complex, consult a chartered accountant before you reply.
3. Prepare. Assemble the exact documents the notice lists, each as a clearly named PDF.
4. Submit and save. Upload your reply through e-Proceedings and save the acknowledgement.

Reply even if you have already filed your return: the Assessing Officer wants substantiation, not a fresh filing, unless the notice is the file-a-return limb. For the full walkthrough, see how to respond to the notice on the e-filing portal.

What should your reply to a Section 142(1) notice contain? (reply structure)

A reply to a Section 142(1) notice should contain three parts: a short covering response that quotes the notice's DIN and the assessment year; a point-by-point answer to each item the notice lists, each numbered to match the notice; and an annexure index of the supporting documents you upload (bank statements, deduction proofs, computations). Address every item the AO raised (even one you dispute), and where you disagree, state your position and attach evidence rather than leaving it blank. Keep the reply factual and self-contained: the officer should be able to close the inquiry from your submission without a second request. The full sample-reply letter and a clause-by-clause template live on the guide to respond to the notice on the e-filing portal.

Failing to comply with a Section 142(1) notice carries a penalty of Rs 10,000 for each failure under Section 272A(1)(d) of the Income-tax Act, 1961. Beyond the penalty, the Assessing Officer can complete a best-judgment assessment under Section 144, estimating your income on the material available (usually to your disadvantage) after giving you a show-cause opportunity. Wilful failure to produce accounts or documents can also attract prosecution under Section 276D (imprisonment up to one year), and wilful failure to file the return called for can attract prosecution under Section 276CC. This is why a 142(1) notice, though routine, should never be left unanswered.

Ignore a 142(1) notice and the cost is a Rs 10,000 penalty under Section 272A(1)(d), plus a best-judgment assessment under Section 144. The current, correct provision is Section 272A(1)(d), not the older Section 271(1)(b).

A Section 142(1) notice can precede scrutiny but does not automatically mean it. If your reply satisfies the Assessing Officer, the inquiry can end there; if it is unsatisfactory or you do not reply, the case can move to a scrutiny assessment under Section 143(2). A Section 143(2) scrutiny notice is the department's formal selection of your return for detailed examination.

The two are distinct, and a full Section 142(1) vs Section 143(2) comparison lives on its own page: 142(1) is a pre-assessment inquiry (and can be issued even before you file), whereas 143(2) is a scrutiny selection notice issued only after a return is filed, within three months from the end of the financial year in which the return is furnished. Treat a clean, complete 142(1) response as your best chance to avoid escalation.