Notice of demand: section 156 notice

Which law applies? The Income-tax Act, 2025 applies to the tax year 2026-27 onwards. Section 536(2)(c) of that Act says the repealed Income-tax Act, 1961 continues to apply to proceedings, including notices, assessment, reassessment, rectification, penalty and appeals, for any tax year beginning before 1 April 2026, that is the financial year 2025-26 (assessment year 2026-27) and earlier. Each notice page below gives both: the 2025 Act first, then the 1961 Act as printed by the Income Tax Department on 22 May 2026. For the oldest assessment years (up to 2021-22) the reassessment time limits in force before 1 September 2024 may apply, and that earlier text was not read.

The Department tells you a sum is payable: tax, interest, penalty, fine or another amount arising from an order or an intimation.

What it means under the Income-tax Act, 2025 (tax year 2026-27 onwards)

Section 289(1) requires the Assessing Officer to serve a notice of demand specifying the sum payable in consequence of an order. Under section 289(2) a sum determined as payable in an intimation under section 270 is itself treated as a notice of demand. Section 411(1) says the amount specified must be paid within thirty days of service of the notice, or a shorter period of not less than the minimum the Joint Commissioner approves where there is reason to believe full time would be detrimental to the revenue. If you file an appeal against the demand, section 411(2) says it is deemed valid until the appeal is finally disposed of.

Time limits under the 2025 Act

Pay within thirty days of service of the notice (section 411(1)). An appeal against an assessment or penalty is filed within thirty days from the date of service of the notice of demand (section 358(3)).

Under the Income-tax Act, 1961 (tax years before 2026-27)

Section 156. Section 156(1): when a sum is payable in consequence of an order the Assessing Officer serves a notice of demand. An intimation under section 143(1) is deemed a notice of demand. Section 220(1): the amount must be paid within thirty days of service, or in a shorter period of less than thirty days if the officer, with the Joint Commissioner's approval, believes a full period would be detrimental to the revenue. If an appeal is filed against the demand, section 220(1A) treats the demand as valid until the appeal is finally decided.

Time limits. Pay within thirty days of service (section 220(1)); present an appeal against an assessment or penalty within thirty days of the service of the notice of demand (section 249(2)).

What to do first

Match the demand with the order or intimation it comes from.
Check the arithmetic and any credit for tax already paid.
Pay within thirty days, or file an appeal or rectification request before the thirty days end.
Ask a chartered accountant before you let a demand lapse: a continuing default carries interest and a penalty (sections 411 and 412).

An outline for a reply

If you dispute it: refer to the demand notice number and date, give the amount you dispute and the reason with the figures, mention any payment already made, and say whether you have applied for rectification or appealed.

Check the deadline

This is a general outline, not a reply to your own notice: facts and documents differ, and the deadline is short. Ask a chartered accountant.

Common questions

What section of the new Act replaces section 156?

Section 289 and 411 of the Income-tax Act, 2025, for the tax year 2026-27 onwards. For earlier tax years the 1961 Act continues to apply to notices (section 536(2)(c)) and the notice quotes section 156 of that Act.

Source

The Income-tax Act, 2025, as published in the Gazette of India Extraordinary: sections 252, 263, 268, 270, 279 to 282, 287, 289, 357, 358, 411, 412 and 536. The enacted text was read on 13 November 2026.
The Income-tax Act, 1961 (text with amendments, printed by the Income Tax Department on 22 May 2026): sections 133, 139(9), 142, 143, 148, 148A, 149, 150, 154, 156, 220 and 249(2). Downloaded from incometaxindia.gov.in and read on 13 November 2026.
Old-section to new-section mapping: the Income Tax Department’s section navigator, checked against the Act (see the Income-tax Sections section of this family).

Rules read on 13 November 2026 from the Income-tax Act, 2025. This site explains notices in general terms. It is not legal advice and does not replace a chartered accountant or tax lawyer. A notice has a deadline: do not rely on a web page for your own case, and ask a professional soon.