you cannot legally avoid providing these bank statements if the Assessing Officer (AO) has explicitly requested them. Merely submitting account numbers is highly risky; a partial response gives the AO grounds to draw an adverse inference or issue a best-judgment assessment under Section 144

2) the AO can technically reject your claim for lacking the standard prescription details, but courts have consistently ruled that genuine relief cannot be denied over purely technical glitches if overwhelming medical evidence is available

3) You can claim HRA and Home Loan Principal (Section 80C), but you cannot claim Home Loan Interest (Section 24b) before taking legal possession of the house 

4) Section 270AA of the Income Tax Act provides an explicit option to seek immunity from penalty under Section 270A and any subsequent prosecution.

You should respond to the notice under Section 142(1) comprehensively rather than trying to avoid producing documents. A notice under Section 142(1) empowers the Assessing Officer to call for accounts, documents and information necessary for completing the assessment. Therefore, it is advisable to provide a proper point by point response rather than selectively withholding documents merely because the Department may already have some information.

For the two old or inoperative bank accounts, I would not simply omit them. If you genuinely cannot presently access the statements, disclose the complete bank details available with you and explain that the accounts were inoperative, had negligible balances, had no transactions during the relevant financial year, and that you are presently unable to obtain historical statements because you have lost the credentials and shifted cities. At the same time, request the respective banks to issue the statements. If there were genuinely no transactions, that fact can also be independently verified by the Department. It is much safer to state that the statement is presently unavailable despite reasonable efforts than to state that you are refusing to furnish it.

Regarding the deduction under Section 80DDB, there is an important distinction. Dementia and Parkinson’s disease may fall within the specified disease framework, but the deduction is subject to statutory conditions, including the prescribed medical certification requirements. Medical records, prescriptions, discharge summaries, treatment records, pharmacy bills and proof of expenditure should nevertheless be submitted because they establish the genuineness of the illness and expenditure.

However, I would not take the position that the prescribed medical certificate is legally irrelevant. If the prescribed certificate was not obtained, the Assessing Officer may technically disallow the deduction even though the underlying expenditure and illness were genuine. The stronger approach is to establish the disease, treatment, dependency and actual expenditure through contemporaneous medical records and request the Assessing Officer to consider the evidence rather than mechanically rejecting the entire claim. If the treating specialist can now issue a supporting certificate based upon the historical medical records, that possibility should also be explored, although whether a subsequent certificate can cure the defect will depend upon the applicable statutory requirements and facts.

You should also verify the exact Assessment Year and tax regime applicable to the return because the limits and conditions under Section 80DDB have changed over time.

Regarding the home loan, claiming HRA while living in rented accommodation is not automatically incompatible with having a home loan. The crucial question is the treatment of the property and the date on which possession was obtained.

Principal repayment under Section 80C and interest deduction under Section 24(b) operate under different statutory provisions. Therefore, the fact that your employer’s finance department accepted the declaration does not by itself establish that the deduction is legally allowable.

You should produce the housing loan certificate, sanction letter, possession letter, construction or completion documents, rent agreement, rent receipts and details of the property. The precise position will depend upon the Assessment Year, the date of possession and whether the property was under construction during the relevant year.

With respect to immunity, there is no general immunity merely because you suffered financial or family hardship. However, genuine hardship and bona fide circumstances can be relevant in appropriate proceedings concerning penalty, condonation or waiver, depending upon the nature of the demand.

It is therefore important to distinguish between tax, interest and penalty. A disallowed deduction does not automatically mean that you have committed a criminal offence.

If the Assessing Officer rejects a deduction, the immediate consequence may be an additional tax demand together with applicable interest. Penalty may also be considered depending upon the circumstances. A bona fide claim which is ultimately found to be legally unsustainable is not automatically equivalent to concealment or furnishing inaccurate particulars. The manner in which the claim was made and the disclosures made in the return are important.

Accordingly, I would not conceal a deduction merely because you presently lack one receipt. Instead, disclose the claim, identify the evidence available, explain what is unavailable and request an opportunity to furnish further evidence.

For the computation of income, the PDF or JSON downloaded from the e filing portal may contain the return data, but you should not assume that the JSON file alone is the computation sheet requested by the Assessing Officer.

You should prepare a clear computation for the relevant Assessment Year showing the gross total income, exemptions, deductions, taxable income, tax liability, rebate if applicable, cess, TDS, advance tax, self assessment tax and refund or balance tax.

You should also attach the filed ITR acknowledgement and the computation generated from the relevant return utility or portal, together with Form 16, Form 26AS and AIS wherever relevant.

The most important step is to structure the Section 142(1) response as a point by point reply corresponding to every question raised in the notice rather than merely submitting a bundle of documents.

For every deduction, the response should explain the statutory provision, amount claimed, factual basis, supporting documents and the reason for any document which is presently unavailable. The response should conclude with a request that the evidence and explanations be considered before making any adverse inference or disallowance.

For the bank accounts, prepare a table containing the bank name, branch, account number, type of account, status, opening balance, closing balance and whether any transaction took place during the relevant year. For inactive accounts, specifically mention that statements have been requested from the bank and will be furnished upon receipt.

For the Section 80DDB claim, prepare a chronological medical compilation containing the diagnosis, age of the parent, treating specialist, prescriptions, hospital records, medicines or equipment purchased, invoices, payment evidence and proof that the expenditure was actually borne by you.

For the HRA and home loan issue, prepare a separate reconciliation showing the period during which you lived in the rented accommodation, rent paid, HRA received, date of loan sanction, date of construction or possession, principal repaid and interest paid. This will enable the Assessing Officer to examine each component separately.

You should not ignore the deadline mentioned in the Section 142(1) notice. If the documents cannot be collected within the stipulated period, seek an extension through the prescribed e filing mechanism before the deadline expires and preserve proof of the request.

Given that the Department has specifically demanded documentary evidence and there are several potentially disputed deductions, the final response should preferably be legally vetted before submission. A poorly worded response can unnecessarily convert a documentation issue into an allegation of inaccurate particulars.

If you provide the Section 142(1) notice, the relevant Assessment Year, your ITR computation and the exact deductions questioned by the Assessing Officer, I can prepare a detailed question by question reply to the Assessing Officer covering the 80DDB claim, HRA and home loan claim, unavailable bank statements and the missing supporting documents.

You cannot avoid submitting bank statements simply because the Assessing Officer (AO) has access to your account numbers. Under Section 142(1), the burden of proof lies on the taxpayer.

You do not need to travel to your old city. You can approach any local branch of that bank, present your PAN card and ID proof, and request a bank statement or an account history printout for that specific Financial Year.

For inoperative accounts, request the bank to issue a "Certificate of Inoperative/Dormant Account" stating there were no active debit/credit transactions in that FY, along with the opening and closing balance.

Section 80DDB explicitly requires a prescription from a specialist in the prescribed format (Form 10-I). The AO has the legal authority to reject the claim on purely technical grounds due to the missing Form 10-I.

You are fully entitled to claim HRA because you lived in a rented property and paid rent.

Under the Income Tax Act, you cannot claim home loan principal repayment (Section 80C) or regular home loan interest (Section 24b) if possession was not handed over during that FY.

The AO will disallow the Section 80C principal and Section 24b interest claims for that year. Do not argue this point legally, as the rule is absolute. Accept the disallowance for that FY and request that the pre-construction interest be allowed in 5 installments starting from the year of possession.

You can file for immunity from penalty under Section 270AA if:

You pay the tax and interest demanded in the assessment order within the stipulated time.

You do not file an appeal against the assessment order.

The penalty is for Under-reporting of income, not Misreporting (which carries a heavy 200% penalty).

If you submit a receipt for a deduction without proving payment through your bank statement or credit card statement the AO will disallow the deduction and add the amount back to your total income. You will be charged interest on the unpaid tax from the due date of filing until the date of payment.

CIT v. Visakhapatnam Port Trust (AP High Court) & K. P. Varghese v. ITO (Supreme Court): Technical procedural non-compliance (such as missing a prescribed form when actual medical hardship and death are proved) should not defeat a legitimate statutory benefit intended by Parliament for genuine taxpayers.

Price Waterhouse Coopers Pvt. Ltd. v. CIT (Supreme Court): The Supreme Court held that a human error or a bona fide mistake does not automatically warrant a penalty if there is no deliberate attempt to hide income.

The downloadable JSON and PDF filed from the e-filing portal are the ITR-V (Acknowledgement) and Form ITR, not the Computation Sheet.

Check your registered email for communication sent by your previous CA/Tax preparer or employer at the time of filing.

If unavailable, you can easily recreate the Computation Sheet using an Excel template.

You can submit this recreated Excel/PDF summary alongside your Form 16 and ITR PDF as your official Computation Sheet.

1. Bank Account Statements

You cannot avoid providing the bank statements. The Assessing Officer (AO) has explicitly requested them under Section 142(1). Submitting only account numbers is risky and may be seen as a partial response, potentially leading to a "best judgment" assessment under Section 144. For the inoperative accounts, explain your situation to the AO in writing. State that no transactions occurred and the balance is minimal. Courts have recognized that assessing officers must act reasonably, and a genuine explanation for the difficulty in obtaining old statements should be considered.

2. Section 80DDB Medical Deduction

You can claim the deduction. The requirement for the statutory Form 10-I is no longer mandatory. A prescription from a specialist doctor is sufficient. Dementia and Parkinson's disease are specified illnesses under this section. You should submit all your medical records, prescriptions, discharge summaries, and the death certificate. Include a covering letter explaining the stressful circumstances and cite CBDT Notification No. 78/2015, which relaxed the rules. Courts have consistently supported a liberal interpretation for genuine medical claims.

3. HRA and Home Loan Deduction

Yes, you can claim both HRA and home loan deductions in the same financial year. They are governed by different sections of the Income Tax Act and do not cancel each other out. You can claim HRA for the rent you paid. For the home loan, you can claim the full year's interest under Section 24(b) if possession was taken even on the last day of the financial year. Principal repayment is deductible under Section 80C. You must be able to justify why you were not living in your own house.

4. Immunity / Waiver Option

Yes, you have an option. You can apply to the Principal Commissioner or Commissioner of Income-tax under Section 273A(4) for a waiver or reduction of penalty. The conditions are that the levy of penalty would cause you genuine hardship and that you have cooperated in the proceedings. The loss of a close dependent family member and the financial strain are strong grounds for genuine hardship. You should file this application early in the assessment proceedings.

5. Consequences of Deduction Being Rejected

If a deduction is rejected, the primary consequence is an increase in your tax liability and the applicable interest. A mere disallowance of a deduction does not automatically trigger a penalty for concealment. Penalties under Section 271(1)(c) require evidence of willful concealment or furnishing of inaccurate particulars. Courts have held that a bona fide claim, even if incorrect, does not attract penalty. The AO would need to prove a fraudulent or malafide intent.

6. Relevant Judgments

Here are two relevant judgments:

• CIT v. Reliance Petroproducts Ltd. (Supreme Court) : This landmark case held that penalty under Section 271(1)(c) cannot be imposed merely because a claim made by the assessee is disallowed. There must be a finding of concealment or furnishing of inaccurate particulars.

• ITAT Rajkot in Pardes Dehydration CO HUF v. ITO (2026) : This recent judgment reiterates that a disallowance of an expense, if fully disclosed, cannot be the sole ground for levying a penalty under Section 271(1)(c). The claim must be bona fide.

7. Computation of Income

The PDF of your ITR is not the computation sheet. The "Computation of Income" is a separate, detailed worksheet you or your tax consultant would have prepared. It shows your total income, deductions under various chapters, and the final tax payable. Since your previous tax consultant is unavailable, you can:

• Check the "e-Proceedings" tab for AY 2025-26 on the e-filing portal to see if a computation was uploaded.

• Recreate the computation in Excel using the figures from your ITR PDF.

• If you cannot prepare it, explain the situation in your response to the AO, attach your ITR acknowledgment and all supporting documents, and request time to obtain or prepare the computation sheet.

1. Excel Attachments

Yes, the portal accepts PDF, Excel, and CSV files (max 10 files, 5MB each). However, a formal cover letter in PDF with clearly labelled annexures is more professional. Use Excel for tabular data (e.g., account lists) and PDFs for explanations and primary documents.

2. Insurance Proof Without Bank Details

Yes, you can submit the eIA number from Bima Central and policy soft copies. While bank statements are generally required to verify transactions, if you genuinely cannot recall the payment source, explain this in your reply and rely on the policy documents. The AO primarily needs to verify the existence and validity of the policy.

3. Meaning of "Account Number"

It includes all financial accounts, not just savings. This typically means savings accounts, home loan accounts, PPF accounts, EPF/UAN, and credit cards. Provide numbers for all accounts you held during the year. If you lack details for an account, explain the situation.

4. Immunity Application

A request in an Excel file is not sufficient. To seek immunity from penalty under Section 270AA, you must file Form No. 68. Filing this form is a procedural requirement and should be done separately through the portal.

5. Requesting Another Adjournment

Yes, you can request more time. While 15 days is standard, the law doesn't strictly limit adjournments. Submit a formal letter explaining the volume of records and your genuine efforts to comply. As long as you demonstrate cooperation, the AO is likely to grant a reasonable extension to avoid a "best judgment" assessment under Section 144.

You can request further adjournment 

2) mention records sought are voluminous and not possible to get those records in 15 days .seek at least amonth tome 

3) You can attach supporting files in Excel (.xls/.xlsx) or PDF format (usually up to 5 MB per file) under e-proceedings on the Income Tax e-Filing Portal.Multi-tab formatted spreadsheets with clean borders are readable, but ensure key textual clarifications are also pasted directly into the portal's designated response text box.

Submit partial response and then seek adjournment as further details ate awaited from banks etc 

2) you should consult your CA regarding templates and forms 

3) You must file formal statutory applications or petitions through the proper electronic window or e-proceedings response format on the portal for Section 270AA (immunity from imposition of penalty) or Section 273A(4) (waiver of penalty/interest on genuine hardship).

1. The portal allows .xls, .xlsx, .csv, and .pdf attachments under e-Proceedings. You can upload an Excel file formatted with borders, structured tables, and multiple tabs.

2. Soft copies of official insurance receipts and your Bimacentral eIA (electronic Insurance Account) statement are strong, third-party proof of payment and active policy coverage.The AO usually accepts these receipts. However, if the AO cross-references your Annual Information Statement (AIS) or Statement of Financial Transactions (SFT) and identifies a large transaction from an undisclosed bank account, they may ask for source verification.

3. The savings and current accounts are to be declared, it is mandatory. You can add Fixed Deposits (FDs/RDs), Demat/Trading account IDs, Mutual Fund folios, and Crypto/VDA wallet details if relevant to the notice.

4. Requesting immunity in an Excel file or cover letter has no legal validity. You must file Form 68 electronically on the portal (e-File -> Income Tax Forms -> File Income Tax Forms -> Form 68).  Form 68 can only be filed after the final Assessment Order is passed.

5. The portal allows multiple adjournment requests. While granting it remains at the AO's discretion, principles of natural justice generally allow up to 3 reasonable adjournments if sufficient cause is shown. State that the notice requires gathering and cross-referencing multi-year records from multiple external entities (banks, insurance repositories, employers) which requires additional processing time

Requesting another 15 days without submitting substantial data risks an ex-parte Best Judgment Assessment (Section 144), where the AO makes additions arbitrarily based on available data and levies penalties. You may submit a Substantial Partial Response Immediately (50%–70% of Data) for a bonafide progress. 

File a Formal Second Adjournment Request. Go to e-Proceedings -> Seek Adjournment on the portal. State clearly: that the "Substantial data (approx. 60%) has been submitted today vide Communication Reference No. [XYZ]. Due to time constraints in sourcing multi-year third-party statements (bank bank/card statements), an additional 10–14 days are requested to furnish the remaining balance."

Neither Section 270AA nor Section 273A(4) can be applied for during the ongoing assessment stage. Both provisions are post-assessment remedies that apply only after an Assessment Order or Penalty Order is passed.

You must pay the entire tax and interest demanded in the Assessment Order within the time specified in the Notice of Demand. You must not file an appeal against the Assessment Order before the CIT(A). Under-reporting must not involve "misreporting" of income (e.g., misrepresentation or suppression of facts)

Section 273A(4) gives the Principal Commissioner of Income Tax (PCIT) discretionary power to reduce or waive any penalty payable if enforcing it causes genuine financial hardship

Dear Client,

As this is a Section 142(1) Income Tax Act notice, you may respond to every point. For the bank accounts, you may not simply omit the inactive accounts; provide their details and explain that they were inactive with no transactions, and request permission if statements are difficult to obtain. For Section 80DDB, you may submit all medical records, prescriptions, discharge summaries and the death certificate; however, the prescribed medical certificate is a statutory requirement, so the Assessing Officer may reject the deduction despite other evidence. Regarding HRA and home-loan deductions, they can generally both be claimed if you genuinely lived in rented accommodation and the house was not yet ready for possession, subject to Section 24(b) and Section 80C conditions. Rejection of a deduction usually results in additional tax and interest; penalty is not automatic, but can arise in cases of under-reporting. Section 270AA may provide immunity in eligible cases after assessment. For computation, an ITR acknowledgement is not necessarily the detailed computation sheet; download the filed return from the e-filing portal or obtain it from your previous tax preparer. Given the circumstances, submit a complete, honest, point-by-point reply with all available evidence and have a Chartered Accountant review it before filing.

Thank you for contacting us, if you have any further queries kindly do not hesitate to contact again. Thankyou.