If you are an investor or a salaried filer in a hurry to get your ITR in for AY 26-27, be aware that the real hazard is now past the due date. The CBDT has put six situations on notice for mandatory scrutiny in FY 2026-27. Even if you are in the clear, you may find yourself with more documentation to produce and a refund that is a bit harder to come by.
You can see the concern in Google Trends: over the past week, there has been a run of searches on what it takes to be put under the ITR scrutiny lens. The message is plain – some of you will be looked at in full, with or without a risk profile or a claim for a refund, and being on time won’t make you immune.
What changed and why now
A recent circular (F.No.225/56/2026/ITA-II) from the CBDT has put in place six Scenario Codes, CS01 through CS06. In FY 2026-27, these will be auto-selected for a closer look. Most returns go through without a hitch, but not when one of these codes is in play.
When an officer does a scrutiny assessment, he is going to be thorough. He will be over the return, the disclosures, every deduction and exemption, and the records to back them up. With the new rules, if your case matches a code, you are in for it, whether you are after a refund or not.
What this means for your cash flow
Your tax rate is the same, but the process has become a little more of a risk. For an investor who needs a refund to put to work, or someone running a trust where exemptions are part of the operation, that is something to factor in.
Some things to keep in mind as you plan:
– You will be selected if you hit the criteria
– A few questions from the department can put off your refund
– Missing a piece of paper can be expensive
– Old disputes have a way of resurfacing
– Any kind of mismatch in the data will be probed
The triggers explained
We are still seeing reassessment cases in the crosshairs. Have you had a Section 148 notice for income that was left out? Your return for FY27 will be subject to complete scrutiny, period. It doesn’t matter what your profile looks like for the current year.
Then there is the matter of intelligence. If an investigation wing or a regulator puts forward a tip about possible evasion, you can be hauled in for a review under Code CS06, even if you have been a model taxpayer.
Those with an eye on exemptions will be checked more closely. We are talking about trusts and research bodies that put in an ITR-7 and claim benefits after their 12A, 12AB, 10(23C) or 35 approvals have been called in. Expect to be put under the scope.
A survey under 133A is also a given. Was your place of business surveyed on or after April 1, 2024? Your return is fair game. (Though we are not counting the 133A(2A) type of surveys done for TDS.)
Search and seizure is in a league of its own. Any action under 132 or 132A from April 1, 2024 onwards will be followed up on. And for any search on or after September 1, 2024, we are looking at the years covered by 158BA(6).
Additions from the past can draw you in again. If the department has had its way on a recurring issue and the numbers are sizeable – say, 50 lakh in the big cities like Delhi, Mumbai or Bangalore, or 20 lakh in other parts of the country – you will be selected.
How to stay off the scanner
The department is using better analytics and talking to other agencies. So it is not just about the ITR; you have to be consistent in your bank and investment activity as well.
Put in all your income and make sure it jives with your 26AS, AIS and TIS. Foreign assets and income should be declared. Hold on to your proofs for any deductions. Check your capital gains and dividends. Don’t put in anything you can’t stand behind.
If you receive a notice
It’s not an admission of guilt, but you do have to be on top of it. Do this to make the process smoother:
– Get your response in on time
– Put up the documents online
– Call in an expert if it is complicated
– Stay on top of your correspondence
They are going to be on top of search results, survey reports, and any hint of evasion. For the rest of us, the only way to go is to be exact in your filing and have your ITR line up with your books.
As we get into the AY 26-27 filings, it is not so much how fast you can be as how right you are. With the CS01 to CS06 codes in effect, having your documentation in order is what will separate a normal year from one with a long-tail review.
