Intimation u/s 245 of income tax act

Submit manual representations and proof of part-payment directly to your jurisdictional Assessing Officer alongside a Section 154 application to correct the old demand records of A.Y. 2016-17.

Section 245 is an intimation, not a demand order - you have options here even after so many years.

The good news is that the original mismatch was a tax credit issue, which falls squarely under Section 154 (rectification of mistake apparent from record). If Form 26AS showed the credit correctly and the AO is going off a different figure, that is rectifiable. Here is what to do:

Step 1 - Check the outstanding demand on the e-filing portal under Pending Actions. See if the demand has been confirmed or is still at the intimation stage.

Step 2 - File a Section 154 rectification online for AY 2016-17 citing the Form 26AS credit mismatch. Attach the Form 26AS and the original payment proof.

Step 3 - Simultaneously respond to the Section 245 notice on the portal (Services > Response to Outstanding Demand). You can dispute the demand or request the AO to verify before adjusting your refund.

Step 4 - If the online rectification has time-bar concerns (Section 154 petitions can be filed within 6 years of the assessment, so AY 2016-17 may still be open until AY 2022-23 technically), a manual representation to the AO citing Form 26AS evidence is the fallback.

The compounding interest situation is tricky, but if the underlying demand was wrong, the interest also falls away once it is rectified.

This [Section 245 income tax notice guide](https://taxgarden.in/blog/section-245-income-tax-notice-refund-adjusted-demand-india) explains the full process of responding and getting your refund released.