RTI If You Receive an Unexplained Income Tax Demand or Notice

An Income Tax demand notice can arrive without any accompanying explanation clear enough to understand. The assessment order may contain additions that refer to "information received from the Investigation Wing" without specifying what that information was. A reassessment notice under Section 148 may state that the Assessing Officer has "reason to believe" income has escaped assessment — but not tell you what that reason is. A Section 143(1) intimation may show a tax demand based on adjustments to your return that seem arbitrary.

In every one of these situations, you have a right to know the basis of the government's claim against you. RTI is not a substitute for filing a rectification, an objection, or an appeal — those statutory routes must be pursued within their own timelines. What RTI does is give you direct access to the document underlying the demand: the computation sheet, the file noting, the reasons recorded by the Assessing Officer, and the prior approvals obtained. With that material, your response to the demand becomes substantially more grounded.

This guide is specifically about RTI as a tool when you receive a demand or notice you cannot understand or verify. It is not a general guide to income tax procedures.

The RTI Target: CBDT and the Income Tax Department

The Central Board of Direct Taxes (CBDT) is a statutory authority under the Ministry of Finance. The Income Tax Department — including all Assessing Officers, Principal Commissioners, Commissioners, and the CBDT itself — is a Central Government body.

This means:

• RTI applications: addressed to the PIO of the relevant Income Tax office (typically the PIO of the charge/range where your assessment is being handled)
• First Appeal: to the First Appellate Authority within the Income Tax Department
• Second Appeal: to the Central Information Commission (CIC)

The fee is ₹10 under the RTI (Regulation of Fee and Cost) Rules, 2005. You can pay by demand draft, IPO, or cash at the office, depending on the facility available.

Section 138: The Misunderstood Restriction

Before looking at what RTI can get you, it is worth addressing Section 138 of the Income Tax Act, 1961 — because Income Tax Department PIOs sometimes invoke it to deny RTI requests.

Section 138 restricts the Income Tax Department from disclosing information about a taxpayer's affairs to third parties — specifically, it prohibits disclosure of information obtained by a public servant in connection with the exercise of their official functions under the Income Tax Act, unless authorised under that section.

This restriction applies to disclosures to outside parties. It does not restrict a taxpayer from accessing information about their own tax file through RTI. When you ask for your own computation sheet, your own assessment file noting, your own APAR reasons, or the reasons recorded by the Assessing Officer regarding your own case — you are asking for information about yourself. Section 138's privacy protection is designed to prevent the tax department from sharing your information with others, not to prevent you from accessing your own file.

If a PIO invokes Section 138 to deny your RTI request for your own tax records, challenge it at the First Appeal stage. The CIC has repeatedly held that Section 138 does not bar a taxpayer from accessing information about their own assessment under the RTI Act.

Scenario 1: Demand Under Section 143(1) Intimation

A Section 143(1) intimation is the automated or summary assessment intimation sent after processing your return. It may show a tax demand if the system has made adjustments to your return — disallowing deductions, adding back income, or making mathematical corrections.

Sometimes these adjustments are wrong, or at least not self-explanatory. The intimation may not make clear precisely what was adjusted or on what basis.

RTI for:

"Please provide a certified copy of the computation sheet or details of the adjustments made under Section 143(1) of the Income Tax Act, 1961 for the assessment year AY, for the taxpayer bearing PAN XXXXX, including the specific head under which each adjustment was made, the amount of the adjustment, and the statutory basis for each adjustment."

This gives you the itemised basis for the demand — which you then use to file a rectification application under Section 154 if there is an error, or to pay the demand with the correct figures if the adjustment is justified.

Scenario 2: Scrutiny Notice Under Section 143(2)

If your return was selected for scrutiny and a notice under Section 143(2) was issued, you are entitled to know why your return was selected. Cases are selected either by the Computer-Aided Scrutiny Selection (CASS) system or manually by the Assessing Officer.

RTI for:

"Please provide: (a) the basis or reason for the selection of the return filed by name, PAN for assessment year AY for scrutiny under Section 143(2) of the Income Tax Act, 1961, specifying whether the selection was made through CASS or manually; (b) if the selection was manual, the file noting or order of the AO recording the reasons for manual selection and the approval of the competent authority obtained before issuing the scrutiny notice."

Manual selection requires reasons and competent authority approval. If the AO selected your return manually without proper reasons or approval, that is a procedural infirmity you should be aware of before the scrutiny proceeds.

Scenario 3: Reassessment Notice Under Section 148 or Section 148A

Reassessment — reopening a previously completed assessment — is a serious step that requires the Assessing Officer to have specific, tangible information suggesting that income has escaped assessment. The Finance Act, 2021 introduced Section 148A, which requires the AO to give the taxpayer an opportunity to be heard before issuing a reassessment notice under Section 148.

Under the current scheme:

1. The AO conducts an inquiry under Section 148A(a) based on "information" suggesting escaped income
2. The AO must show this information to the taxpayer and seek a response under Section 148A(b)
3. After receiving the response, the AO passes an order under Section 148A(d) determining whether a case for reassessment exists
4. Only then is a Section 148 notice issued

Despite this, taxpayers sometimes receive Section 148 notices where the underlying "information" is vague, the prior approval under Section 148A(b) appears to have been obtained mechanically, or the order under Section 148A(d) does not engage with the taxpayer's response.

RTI for:

"Please provide: (a) the 'information' as defined under Explanation 1 to Section 148 of the Income Tax Act, 1961, that formed the basis for initiating proceedings under Section 148A in the case of name, PAN for assessment year AY; (b) a copy of the show-cause notice or information provided to the taxpayer under Section 148A(b); (c) a copy of the prior approval obtained from the specified authority under Section 148A(1) before issuing the Section 148A(b) notice; (d) a copy of the order passed under Section 148A(d); (e) a copy of the prior sanction obtained under Section 151 before issuing the Section 148 notice."

The "reasons to believe" — or in the post-2021 scheme, the specific "information" — is the bedrock of any reassessment proceeding. Courts have consistently held that vague, non-specific, or borrowed information cannot sustain reassessment. If the RTI response reveals that the information was thin or not properly verified, that strengthens your objection under Section 148A or your challenge before the ITAT.

Scenario 4: High-Pitched Assessment and Unexplained Additions

An assessment order under Section 143(3) may contain additions to your income — on account of unexplained cash credits, unexplained investments, unexplained expenditure, or income from undisclosed sources. Sometimes these additions are based on documents or information that you were not given a full opportunity to address, or on reasons that are not stated clearly in the assessment order itself.

RTI for:

"Please provide: (a) a certified copy of the assessment order and computation sheet for the assessment year AY in the case of name, PAN, including all additions made to the returned income and the statutory provisions under which each addition was made; (b) the file noting(s) recording the Assessing Officer's reasons for each addition made in the assessment order; (c) copies of all documents, statements, or material relied upon by the Assessing Officer in making the additions, which were not already provided to the taxpayer during the assessment proceedings."

The file noting is particularly important. The assessment order is the public face of the decision; the file noting shows you the officer's internal reasoning, the instructions received from higher-ups (if any), and the evidence relied upon. Any material that was used against you and not provided to you raises a natural justice concern that can be pressed at the Commissioner of Income Tax (Appeals) or the ITAT.

Scenario 5: Demand Despite a Filed Return or Claimed Refund

Sometimes a demand arrives for an assessment year for which you have already filed a return claiming a refund, or for which you believe the tax has already been paid. The accounts may show a mismatch.

RTI for:

"Please provide: (a) the tax credit statement or Form 26AS data as processed by the department for name, PAN for assessment year AY at the time of issuing the demand dated date; (b) the reconciliation prepared by the Assessing Officer or Processing Centre between the tax liability as per the return filed and the demand raised; (c) the specific reason recorded for issuing the demand notwithstanding the return filed/refund claimed."

This is especially useful for demands arising from TDS credit mismatches or employer-side filing errors. The RTI response may show that the department's own records have a processing error that should be corrected through rectification.

RTI for ITAT Case Status and Delay

The Income Tax Appellate Tribunal (ITAT) is a quasi-judicial body under the Ministry of Finance. It is a Central Government body for RTI purposes, and second appeals from ITAT RTI denials go to the CIC.

If you have a pending appeal before the ITAT and want to know the status, bench allocation, or reason for extended delay:

"Please provide: (a) the current status of ITA Number X for assessment year AY filed by name, PAN, including the bench to which it has been allocated and the date of the last hearing; (b) the number of ITAT appeals pending in zone/city bench that were filed in assessment year AY and have not been heard for more than X years; (c) whether any priority or out-of-turn listing has been applied to any appeal filed by the same taxpayer."

ITAT delays can stretch for years. While RTI cannot compel a faster hearing, documenting the delay — especially if you have a stay on demand that is subject to periodic renewal — creates a record that can be referred to in a mentioning application before the ITAT bench or in correspondence with the ITAT's administrative machinery.

The File Noting Denial: Challenging Section 8(1)(e)

The Income Tax Department sometimes denies access to file notings in assessment cases by invoking Section 8(1)(e) — arguing that the file noting contains information about the taxpayer held in a fiduciary relationship.

This argument is wrong, and the CIC has said so repeatedly.

The Assessing Officer is a statutory authority performing a quasi-judicial function under the Income Tax Act. The AO is not in a fiduciary relationship with the taxpayer — the AO is an adjudicating officer exercising statutory powers against the taxpayer. A fiduciary relationship involves trust and confidence reposed by one party in another — the opposite of an adversarial tax assessment proceeding.

In your First Appeal against a file noting denial, make this argument explicitly: the AO is performing a quasi-judicial function, not holding information in trust; Section 8(1)(e) does not apply; the file noting is the basis of the assessment order and the taxpayer has a direct interest in accessing it.

Critical Timing Note: Do Not Wait for RTI Before Acting

This is the most important practical point in this guide.

The RTI Act gives the PIO 30 days to respond. Tax proceedings have much shorter statutory timelines:

• Objections to a Section 148A notice must be filed within the time specified in the notice (typically 15 to 30 days)
• Appeals against assessment orders to the CIT(A) must be filed within 30 days of the date of service of the assessment order
• Rectification applications under Section 154 have a four-year window but should be filed promptly to arrest demand recovery

Do not delay filing your objection, response, or appeal while waiting for your RTI response. Pursue both simultaneously.

File your RTI on the day you receive the demand or notice, and file your statutory response or appeal independently, within the required timeline, even if you do not yet have all the information you want. Once the RTI response arrives — within 30 days, or 48 hours if life/liberty is genuinely at stake, which is unlikely in tax matters — you can use the additional information to supplement your submissions, file an additional reply, or prepare for the appellate proceeding with a stronger evidentiary base.

RTI is a parallel track, not a substitute for the statutory response mechanism. The two reinforce each other — but only if you have preserved your rights in the statutory proceeding by acting in time.