Replying to an income-tax notice calling for information (s.133(6), now s.252(1)(a))

What the notice is

Under the Income-tax Act 1961 this was a notice under s.133(6). In the Income-tax Act 2025, in force from 1 April 2026, the same power sits in s.252(1)(a): an income-tax authority may require any person, including a banking company or any of its officers, to furnish information on points or matters, or statements of accounts, that will be useful for or relevant to any enquiry or proceeding under the Act.

• It is a request for information, not an assessment of your income, and not a summons to appear.
• Where no proceeding is pending, an officer below the rank of Principal Director or Principal Commissioner needs prior approval of a higher authority before issuing it (s.252(3)).
• Notices issued after 1 April 2026 for earlier years commonly cite s.252(1)(a) of the 2025 Act, sometimes alongside s.133(6). The power is the same; quote whatever section the notice uses.

Who receives it

• The taxpayer, under the department's data-matching programmes: high-value cash deposits, property purchases, share or mutual fund transactions, foreign remittances, or a mismatch between the AIS and the return.
• Banks, brokers, depositories and registrars, for account statements and transaction data.
• Companies and firms asked about third parties: payments to a vendor or contractor, salary to an employee, loans from or to a person, or the shareholding of a particular shareholder, because that person is being assessed.

The third-party case is common and often confusing. A company may receive a notice listing items such as demat statements, contract notes, capital gains and F&O profit for one of its shareholders, because the officer has used a standard broker-format questionnaire. A company that is not a broker or depository participant holds none of that. The right reply says so, item by item, and gives what the company does hold.

Check it is genuine

1. Find the DIN on the notice. Verify it on the e-filing portal under Authenticate notice/order issued by ITD.
2. Log in to the e-filing portal and check Pending Actions > e-Proceedings (or the Compliance portal for e-verification items). A genuine notice is usually there.
3. Check that the officer, ward and email domain match the department. Notices never ask you to pay to a private account or share passwords or OTPs.
4. If a notice is delivered only by email and not traceable on the portal, reply asking the officer to upload it, and keep a record.

How to reply

1. Read the scope. Note the period (financial year or tax year), the person or transactions it relates to, and each item requested.
2. Make an item list. For each item: do we hold it (yes, partly, no), where it is, who will pull it.
3. Reply through e-proceedings on the e-filing portal against that notice: a covering letter plus attachments (PDF, within the portal size limits). Keep the acknowledgement.
4. Answer point by point in the notice's numbering. For items you do not hold, say "not applicable" with a one-line reason (for example, "the company is not a stock broker or depository participant and holds no trading or demat records of any person").
5. Attach what you do hold and what was asked: ledger extracts, payment details, TDS particulars, KYC on file, register of members entries, as relevant.
6. Sign by the authorised signatory, with a statement that the information is furnished from the records of the entity.
7. If you need more time, request an adjournment through the portal before the due date with a reason.

What to give and what not to volunteer

Adding a short statement of the person's shareholding from the register of members, where the notice is about a shareholder, is usually helpful: it is information the company does hold, and it explains the relationship. Beyond that, answer the question asked.

Timelines and penalty

• The due date is the one in the notice, often 7 to 15 days. There is no fixed statutory period.
• Failure to furnish information called for is liable to a penalty of ₹500 for every day the failure continues: s.465(2)(c) of the 2025 Act [272A(2)(c)].
• Penalty should not be levied where there was reasonable cause for the failure (old s.273B; check the corresponding provision of the 2025 Act verify).
• Furnishing false information is a separate and more serious matter. Check figures before filing.

Confidentiality of third-party data

• A statutory notice generally overrides a contractual confidentiality clause, so you do not need the third party's consent to comply. Note in the reply that the information is personal data furnished in compliance with the notice.
• Share only with the officer named in the notice, through the portal. Do not email personal data to unverified addresses.
• Do not tell the third party what the notice asks or what you replied unless you have a clear reason and legal advice. There is no general duty to inform them.
• Under the Digital Personal Data Protection Act 2023, processing personal data to comply with a law or an order of a government body is a permitted ground; keep a record of what was shared and why verify.

Common questions