Section 245 Notice your refund is at risk of adjustment.
A Section 245 notice tells you the Income Tax Department intends to adjust your refund against an outstanding demand from earlier years. If the demand is wrong, disputed, or stayed, you must respond — or your refund will be taken away.
Section 245 of the Income Tax Act allows the department to set off a refund due to a taxpayer against any tax demand outstanding for an earlier year. Before doing so, the department is required to issue an intimation under Section 245 and give the taxpayer an opportunity to respond.
Many 245 notices relate to demands that the taxpayer has already contested in appeal, has obtained stay against, or has paid earlier with credit not yet appearing in the system. In other cases, the demand may be stale, erroneously raised, or based on a return processing error. Either way, silence equals acceptance — the refund will be adjusted automatically.
Our team responds to Section 245 notices by examining the demand cited, identifying its current status (paid, stayed, appealed, or erroneous), drafting a structured response on the e-filing portal, and protecting your refund from being unjustly adjusted. Where the demand is genuine, we advise on payment and clarify how the refund will be applied.
Our 245 Response Services
Demand Verification
Checking the outstanding demand cited — its assessment year, amount, and current status on the portal.
Payment Trail Reconciliation
Verifying whether the demand has been paid earlier and the credit needs to be brought into the system.
Stay & Appeal Status
Confirming whether the demand is stayed or under appeal, and providing supporting orders to CPC.
Rectification Support
Filing rectification under Section 154 where the demand is erroneously reflected on the portal.
Response Drafting
Drafting a precise reply on the e-filing portal with documentary support for every contention.
Refund Protection
Ensuring that refunds due are not adjusted against demands that are paid, stayed, or invalid.
Demand Closure
Working with CPC and AO to get stale or wrong demands removed from the portal permanently.
Follow-Up
Tracking refund issuance after closure of the 245 proceeding.
How We Protect Refund
Notice Review
Study of the 245 notice and identification of the demand sought to be adjusted.
Status Check
Verifying demand status — paid, stayed, appealed, or erroneous — with documentary evidence.
Reply Drafting
Drafting a precise reply with supporting orders, challans, and reconciliations.
Portal Submission
Filing the response on the e-filing portal within the deadline mentioned in the notice.
Refund Tracking
Tracking issuance of refund post resolution of the demand adjustment proceeding.
Why a Reply is Essential
Frequently Asked Questions
A Section 245 notice is an intimation that the Income Tax Department proposes to adjust your current year's refund against an outstanding tax demand from an earlier year.
Yes. If the demand is paid, stayed, or under appeal, you can respond on the e-filing portal with supporting documents to prevent the adjustment.
The notice typically allows 30 days for response. If no reply is filed, the refund is automatically adjusted against the outstanding demand.
You can file a rectification application under Section 154 to correct the demand on the portal, and respond to the 245 notice with the rectification reference.
If your reply is accepted, the refund will be released after the demand is correctly classified. Timelines vary based on CPC processing and the nature of the demand.
Refund Held Up by a 245 Notice?
Don't let an old or wrong demand swallow your refund. Talk to our team for a clean, documented reply that protects your money.
Protect Your Refund or call +91 9819 000 511