Got an Income Tax Intimation under Section 143(1)? Here's How to Read It and What to Do Next

You filed your ITR in July and verified it on time. Now there's an email from the Centralized Processing Centre (CPC) with a password-protected PDF titled "Intimation u/s 143(1)."

Take a breath. An intimation is not a scrutiny notice. It's the department's automated summary of how it processed your return. But you shouldn't ignore it either. Some intimations bring good news, some carry a small demand, and a few contain adjustments you can and should challenge.

What Is Section 143(1)?

Every return you file goes through a computerised check at CPC, Bengaluru. The system compares your return with what the department already knows about you: Form 26AS, AIS, TDS returns filed by deductors, and your own figures. The result is an intimation that tells you one of three things:

Outcome	What it means	Action needed
No demand, no refund	Your computation matches the department's	None. Keep it for your records
Refund determined	You've paid more tax than due	Check the amount and your bank account
Demand determined	The department computes more tax payable	Verify, then pay or dispute

A note for this year: the Income-tax Act, 2025 came into force on 1 April 2026, but returns for AY 2026-27 (income of FY 2025-26) are processed under the old Act. Proceedings relating to AY 2026-27 and earlier years continue under the old Act by virtue of Section 536(2)(c) of the new law. Your intimation will therefore still cite Section 143(1).

How to Open the Intimation

The PDF password is your PAN in lowercase followed by your date of birth in DDMMYYYY format. For example, abcde1234f01011990.

You can also download it from the e-filing portal under e-File → Income Tax Returns → View Filed Returns.

Reading It: The Two-Column Comparison

The heart of the intimation is a side-by-side table:

• "As provided by taxpayer in return of income": your figures

• "As computed under section 143(1)": the department's figures

Go line by line. If both columns match and the final line shows nil or a refund, you're done. If they differ, the variance explains any demand or reduced refund.

What Adjustments Can CPC Make?

The law allows only limited, prima facie adjustments under 143(1)(a). CPC can't question the merits of your claims. It can only correct:

1. Arithmetical errors in the return

2. Incorrect claims apparent from the return, such as a deduction exceeding the statutory limit

3. Losses claimed in a belated return where the law requires filing by the due date

4. Expenditure disallowed in the tax audit report but not added back in the return

5. Deductions under specified sections (such as 80-IA/80-IAB) claimed in a belated return

6. Income shown in Form 26AS or Form 16/16A but omitted from the return

Important safeguard: Before making any such adjustment, CPC must send you a prior communication proposing it and give you 30 days to respond. If you ignored an email in August about a "proposed adjustment," that may be why the demand now appears.

Common Reasons for a Demand (and Quick Fixes)

1. TDS credit mismatch. The deductor filed its TDS return late, quoted a wrong PAN, or hasn't filed at all. The credit you claimed doesn't appear in 26AS, so CPC disallows it. Fix: Ask the deductor to file a correction statement. Once it reflects in 26AS, file a rectification.

2. Interest under 234A/B/C recomputed. Small demands of a few hundred rupees are often just interest differences, usually because advance tax dates or self-assessment tax timing were computed differently.

3. Regime-related mismatch. Deductions claimed under the old regime without filing the required option, or claimed in a regime that doesn't permit them.

4. Income in AIS/26AS not reported. Savings interest, dividends, or FD interest you forgot to include.

5. Self-assessment tax challan not linked. A challan paid with the wrong assessment year selected won't be credited. This is a real risk this year, when both AY 2026-27 and Tax Year 2026-27 appear on the challan screen.

Your Options When You Disagree

Option 1: Respond to the outstanding demand

On the portal, go to Pending Actions → Response to Outstanding Demand. Choose whether the demand is correct (then pay), partially correct, or whether you disagree (give reasons and upload evidence). This keeps the department from adjusting the demand against future refunds without hearing you.

Option 2: File a rectification under Section 154

If the error is apparent from the record, such as a TDS credit now showing in 26AS or a computational slip, file an online rectification request. The time limit is four years from the end of the financial year in which the intimation was passed, but act early.

Option 3: File an appeal

If the dispute goes beyond a clerical mistake, an appeal before the Commissioner (Appeals) lies against the 143(1) intimation. It must be filed within 30 days of receiving it.

Option 4: Revise the return

If you made the mistake, such as missing income or a wrong deduction, a revised return is often the cleanest route, provided you're within the time limit and the assessment isn't complete.

What If It Shows a Refund?

• Check the refund amount against what you claimed.

• Confirm your bank account is pre-validated and PAN-linked, because refunds fail silently otherwise.

• Interest on refund (Section 244A): if you filed by the due date, you're generally entitled to interest at 0.5% per month from 1 April of the assessment year. CPC adds it automatically, and it's taxable in the year you receive it.

Timelines to Remember

• Processing deadline: CPC must issue the intimation within nine months from the end of the financial year in which you filed. For returns filed in 2026, that's 31 December 2027.

• Response to a prior adjustment proposal: 30 days

• Appeal: 30 days from receipt

• Rectification: up to four years, but sooner is better

The Bottom Line

Most 143(1) intimations need nothing more than a quick read and a filing in your records folder. The ones that show a demand usually trace back to a handful of fixable causes: a TDS mismatch, a missed interest entry, or a challan tagged to the wrong year.

The costly mistake is ignoring the intimation. An unanswered demand quietly eats into next year's refund, accrues interest, and closes off your right to challenge it.

Received an intimation you don't understand? Upload it to KarrTax's IT Notice Assistance, and our CA team will review the comparison, identify the cause, and file the right response for you.

Related reading on KarrTax: Responding to Section 139(9) Defective Return Notices · What to Do When Your Income Tax Refund Fails · How to Prevalidate Your Bank Account