income tax Rectification

I filed an ITR-U in August 2025 for FY 2022–23 (AY 2023–24) to withdraw one tax exemption while keeping the rest of the return unchanged.

In March 2026, I received an outstanding demand of ₹x,000. To resolve this, I have taken the following actions on the Income Tax e-Filing portal:

1. Filed a Rectification Request

• Logged in to the e-Filing portal
• Went to Services → Rectification
• Selected Order Passed by CPC and the relevant Assessment Year
• Chose the option “Reprocess the Return”

2. Responded to the Demand Notice

• Logged in to the e-Filing portal
• Went to Pending Actions → Response to Outstanding Demand
• Selected “Disagree with demand”
• Chose the reason “Rectification/Revised Return filed at CPC”
• Entered ₹x,000 as the amount not payable
• Filing Type: Rectified
• Provided the e-Filed Acknowledgement Number
• Submitted the response

My queries are:

1. After taking the above steps, what will happen next? Will the return be reprocessed by CPC, or will the case be transferred to the Jurisdictional Assessing Officer (AO)?
2. If it goes to the AO, can the AO ask for documentary proof for the tax exemption that was originally claimed?
3. If I am unable to provide such proof, what action can the AO take?
4. Or will the department simply recompute the tax based on the updated ITR-U that I filed?
5. If I pay the ₹x,000 demand and then resubmit the response, will the case close automatically, or will it still depend on AO review or CPC processing?
6. Is it mandatory to respond to the outstanding demand notice even after filing a rectification request, or is the rectification request alone sufficient?

I would appreciate guidance on the correct procedure and the likely process going forward.