Income Tax Raids, Notices, Assessments – Reasons behind it

Income Tax Raids, Notices, Assessments – Reasons behind it, The article is mainly about why the Income tax officials conduct raids at your office.

CA Yash Shah

Income Tax Raids, Notices, Assessments

Income Tax Raids: The article is mainly about why the Income tax officials conduct raids at your office or house or any other places. This article is written for guiding every person to avoid such mistakes, which helps the income tax officials to find the mistakes done by common man in Business. Now check more details regarding “Income Tax Raids, Notices, Assessments” from below….

Income Tax Raids, Notices, Assessments

There are two instances where the assessee may be given a scrutiny notice or their case may be taken up by income tax officials. They are:

  • Voluntary Route
  • Compulsory Route

These are the routes which are available with the income tax officials to conduct raid or give notice or start with the scrutiny assessments. We would discuss each of them individually.

1. Voluntary Route –

This Route refers to the instances where the assessee has made some mistakes in filing the return and due to which the doubt has been arisen in the minds of income tax officials. Mainly due to the following reasons, income tax scrutiny assessments are done:


Content in this Article

  • Not filed Return – If your income exceeds the basic exemption limit, than it is compulsory for you to file the income tax return with the income tax department. If your case comes in the hands of the income tax officials through the outer sources, than you might fall in trouble, because it may lead to huge penalty and interest.
  • Shown Lesser Income – When the person shows the income which is less than what he has actually earned or if tries to hide the income through various illegal tax practices, Then your case may come into the eyes of income tax department.
  • Claimed more expenses – As in the above case, if you have shown less income than it may come to scrutiny, in the similar manner, if you try to show more expenses and try to claim more expense as deductions then also it may lead you in trouble.
  • Large Value Transactions – If you have transacted for more than a typical amount with some party, then it may come into the notice of income tax department which might lead you to detailed analysis of the transaction.
  • Mismatch in TDS credits – You should always match the tax credit you have taken with the actual tax credit available in Form 26AS. The amount of credit you should be allowed should be the same. If it is not matching, than you need to check the whole scenario before submitting to the income tax department.
  • Non-Disclosure of Exempted Income – The common man is not much aware about the disclosures which need to be made to the department. It should be noted that the income which is exempted needs to be disclosed to the department without seeing the nature of it.

2. Compulsory Route –

This is the route which is selected by the department if there have been discrepancies in following the laws. The following are some of the instances :

  • There is some pre-decided level of income which is decided every year by income tax department, which are taken up for the scrutiny. So if your income falls under the category, they would be taken up.
  • Assessee has been granted the subsidies or any incentives which is dependent upon some criteria’s, failing to which, the department would be carrying out detailed scrutiny into the matter.
  • Some information has been received by the outside party based on some of the proofs provided by the other party, find some of the tax evasions, than department would be carrying out detailed scrutiny.
  • There can be many other cases, where the notices can be issued or scrutiny can be initiated.


To save yourself from such tax consequences, you need to take care of the small and silly mistakes that can be occurred while finalizing the accounts.

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CA Yash Shah

Yash Shah is passionate article writer in and has written more than 100 articles in the field of Finance, Insurance, Stock Market, Company Law, Auditing, Taxation and many others. In case of any queries or suggestions, you can reach the author @, you can also catch him on facebook @ yashshah299

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