Section 270 Income Tax Act 2025: When Can Your ITR Be Adjusted or Scrutinised?
Section 270 of the Income-tax Act, 2025, titled Assessment, governs processing of returns, tax and refund intimations, scrutiny notices, and regular assessment orders. It also provides procedural safeguards and special requirements for certain institutions.
How is an income-tax return processed under Section 270(1)?
Where a return is filed under Section 263, or in response to a notice under Section 268(1), the return is processed to determine income or loss, applicable tax, interest and fees, and the amount payable or refundable.
Under Section 270(1)(c), the computation takes account of tax deducted at source (TDS), tax collected at source (TCS), advance tax, eligible rebates or relief under Chapter IX, self-assessment tax, and other relevant payments of tax, interest or fee. An intimation states the amount payable or refundable, and a refund determined under the provision is to be granted.
Which adjustments can be made while processing an ITR?
Section 270(1)(a) permits specified adjustments, rather than a general reassessment of every factual or legal dispute:
| Provision | Permissible adjustment |
|---|---|
| 270(1)(a)(i) | Correction of an arithmetical error in the return. |
| 270(1)(a)(ii) | An incorrect claim apparent from information in the return. |
| 270(1)(a)(iii) | A prescribed inconsistency between the return and information in the return for a preceding tax year. |
| 270(1)(a)(iv) | Disallowance of loss claimed where the return for the tax year to which the relevant set-off relates was filed after the specified due date. |
| 270(1)(a)(v) | Disallowance of expenditure, or increase of income, identified in an audit report but omitted from the return computation. |
| 270(1)(a)(vi) | Disallowance of a deduction under Chapter VIII-C where the return was filed beyond the due date under Section 263(1), as provided by the current amended text. |
Statutory definition - Section 270(5)(a): An "incorrect claim apparent from any information in the return" includes a claim inconsistent with another return entry; a claim for which legally required supporting information has not been furnished; or a deduction exceeding an express statutory monetary, percentage, ratio or fractional limit.
Must the department give an opportunity to respond?
Yes. Section 270(2) requires communication of a proposed adjustment in writing or electronically before it is made. Any taxpayer response must be considered. If no response is received within 30 days from issue of the communication, the adjustment may be made and an intimation issued. Check the notice carefully and preserve proof of a timely reply.
Under Section 270(3), an intimation is also required where the returned loss is adjusted even if neither tax nor a refund results. Section 270(5)(b) treats the return acknowledgement as the intimation where no sum is payable or refundable and no adjustment is made.
What are the statutory time limits?
| Event | Section 270 time limit |
|---|---|
| Response to proposed adjustment | 30 days from issue of the communication: Section 270(2). |
| Issue of return-processing intimation | Not later than nine months from the end of the financial year in which the return was made: Section 270(4). |
| Service of scrutiny notice | Not later than three months from the end of the financial year in which the return was furnished: Section 270(9). |
The above periods relate to the specified actions under Section 270. Completion of an assessment is governed by separate provisions, including Section 286, and may involve special rules or exclusions.
When can the Assessing Officer initiate scrutiny assessment?
Section 270(8): Scrutiny notice
The Assessing Officer or prescribed income-tax authority may issue a notice where considered necessary or expedient to ensure that the taxpayer has not understated income, computed excessive loss, or underpaid tax. The notice may require attendance or production of evidence supporting the return.
Section 270(9): Time for service
A scrutiny notice under Section 270(8) must be served within three months from the end of the financial year in which the return is furnished.
Section 270(10): Assessment order
After considering the taxpayer's evidence, other evidence requested on specified points, and all relevant material gathered, the Assessing Officer makes a written order assessing total income or loss and determining tax payable or refund due, subject to the safeguards for specified entities in Section 270.
Section 270(6) and (7): Centralised processing
The Central Board of Direct Taxes may establish a centralised return-processing scheme to expedite the determination of tax payable or refunds. The scheme must be laid before each House of Parliament as provided by the Act.
What safeguards apply to specified institutions?
Sections 270(11) and (12): For research associations, associations or institutions, and other institutions specified in Schedule III (Table serial numbers 23, 24 and 25), the provision places conditions on making an assessment without giving effect to Section 11. It requires the prescribed communication of contravention and withdrawal or rescission of the relevant approval or notification.
Section 270(13): Where a registered non-profit organisation has committed a specified violation under Section 351(1), the Assessing Officer must refer the matter to the Principal Commissioner or Commissioner and give effect to the relevant order before completing the specified assessment.
Section 270(14): Where a university, college or other institution referred to in Section 45(3)(a) fails to comply with approval conditions, the Assessing Officer may recommend withdrawal after giving a reasonable opportunity to show cause; the Central Government may then decide on withdrawal.
Section 270(15): Tax or interest paid during return processing is credited towards regular assessment under Section 270(10) or Section 271. A refund paid in excess of what is due on regular assessment is treated as tax payable under the Act.
Relevant statutory definitions and concepts
Practical illustrations
Example 1 - Arithmetical mistake: A taxpayer totals income entries incorrectly. The return may be adjusted for the arithmetic error under Section 270(1)(a)(i), after the communication required by Section 270(2).
Example 2 - Proposed disallowance: The taxpayer receives an electronic proposal to disallow a deduction. The taxpayer should check whether the proposed adjustment falls within Section 270(1)(a) and respond with the relevant return entries and evidence within the statutory 30-day period.
Example 3 - Scrutiny notice: A return filed in July 2026 falls in financial year 2026-27. Under Section 270(9), the ordinary deadline for service of a scrutiny notice under Section 270(8) is three months from 31 March 2027, namely 30 June 2027, subject to any applicable statutory modification.
Example 4 - Refund after scrutiny: If a refund issued on processing exceeds the amount ultimately due on regular assessment, Section 270(15) addresses recovery of the excess as tax payable.
Frequently asked questions
Is Section 270 assessment the same as automated ITR processing?
No. Section 270 contains both return processing under subsection (1) and scrutiny assessment under subsections (8) to (10). The procedures and safeguards differ.
Can a tax adjustment be made without informing the taxpayer?
For adjustments under Section 270(1)(a), Section 270(2) requires prior communication and consideration of a response, if received.
How much time is allowed to reply to a proposed adjustment?
Section 270(2) specifies 30 days from the issue of the communication before the proposed adjustment may be made where no response is received.
What is the deadline for issuing an ITR processing intimation?
Section 270(4) prohibits an intimation under subsection (1) after nine months from the end of the financial year in which the return was made.
What is the deadline for a scrutiny notice?
Under Section 270(9), a notice under Section 270(8) cannot be served after three months from the end of the financial year in which the return was furnished.
Is Section 270 of the 2025 Act equivalent to Section 270 of the 1961 Act?
No. Section 270 of the 2025 Act broadly corresponds to Section 143 of the 1961 Act. Numbering under the two Acts should not be confused.
Statutory sources and related provisions
Read the Income Tax Department's official Income-tax Act, 2025 resources and the official 1961-to-2025 section mapping. For the wording of Section 270, consult the published statutory text and verify it against the latest official amended Act and notifications.
Updated: 11 November 2026. This article is general legal information and does not replace examination of the applicable statutory text, notifications, assessment notice and tax-year-specific facts.