Filing of Returns
Chapter XIV of the Income Tax Act, 1961 deals with the procedure for assessment.
Section 139 of the IT Act deals with the filing of returns of income. The following are the provisions of this section in brief:-
1. Every person being a company and every other person who has taxable income during any previous year must furnish a return of income in the prescribed form and verified in the prescribed manner giving the prescribed details on or before the due date for such furnishing.
2. Every person who satisfies any one of the following six criteria will also have to file a return of income:-
He is in occupation of an immovable property exceeding a specified floor area, whether by way or ownership, tenancy or otherwise
He is the owner or the lessee of a motor vehicle (Owner of a two wheeler is not considered for this purpose)
He is a subscriber to a telephone, including a mobile phone
He has incurred expenditure for himself or any other person on travel to any foreign country other than neighbouring countries or to such places of pilgrimage as the CBDT notify (Pilgrimage to Nepal or Haj)
He is the holder of a credit card other than an add-on credit card issued by any bank or institution
He is a member of a club where entrance fee charged is Rs25,000 or more
The Central Government may by notification in the Official Gazette specify class or classes of persons to whom the above provisions do not apply.
Due date for this purpose means:-
31 October of the relevant AY where the assessee is a company.
Where the assessee is not a company and his accounts are required to be audited under the Income Tax Act or any other law for the time being in force or where an accountant's report is required u/s 80 HHC or 80HHD or where the prescribed certificate is required to be furnished u/s 80 R or 80 RR or 80 RRA or where the assessee is a co-operative society or in case of a working partner of a firm whose accounts are required to be audited, 31 October of the relevant AY Also in the case of an assessee to whose return such audited accounts are to be attached.
31 July of the relevant AY in all other cases.
If the assessee has balance of carry forward losses under the heads of "Profits & Gains of business or profession" or "Capital gains", he must furnish a return of income in the prescribed form and verified in the prescribed manner giving the prescribed details on or before the due date for such furnishing.
Any person who has not furnished the return of income within the time allowed as mentioned above may furnish the return for any previous year at any time before the expiry of one year from the end of the relevant assessment year or before the completion of the assessment, whichever is earlier.
Any person receiving income from property held under trust or other legal obligation wholly or partly for charitable or religious purposes or income in the form of voluntary contributions u/s 2(24)(iia) (dealing with such trusts and recognised institutions) must furnish a return of income in the prescribed form and verified in the prescribed manner giving the prescribed details on or before the due date for such furnishing if the total income in respect of which he is assessable under the provisions of the Income Tax Act exceeds the maximum amount not chargeable to tax.
The Chief Executive officer, by whatever name called of every political party must furnish a return of income in the prescribed form and verified in the prescribed manner giving the prescribed details on or before the due date for such furnishing if the total income in respect of which it is assessable under the provisions of the Income Tax Act exceeds the maximum amount not chargeable to tax.
If any person has already submitted his return of income in accordance with the above-mentioned provisions and subsequently he discovers any omission or wrong statement therein, he may furnish a revised return for any previous year at any time before the expiry of 1 year from the end of the relevant assessment year or before the completion of the assessment, whichever is earlier.
A return of loss can also be filed within the due dates mentioned above.
Defective or Incomplete Return
If the assessing officer is of the opinion that the return of income furnished by the assessee is defective, he has the discretion to intimate the defect to the assessee and give him an opportunity to rectify the defect within 15 days from the date of intimation or such time as may be extended by the assessing officer. If the return is not rectified by the assessee within such time, it will be treated as an invalid return and it will be deemed that the assessee had not filed any return. However if the assessee rectifies the return after such time, the assessing officer may condone the delay and treat the return as a valid return.
A return will be deemed to be defective unless all the following conditions are satisfied:-
The return, all its annexures, columns, statements relating to the computation of income chargeable under the various heads of income, computation of gross total income and taxable income are completely and properly filled.
The return is accompanied by the following:-
A statement showing the computation of tax payable on the basis of the return
An audit report referred to u/s 44AB or where such report has been furnished earlier, a copy of such report along with proof that it has been submitted earlier.
Proof of tax deducted at source, advance tax and self-assessment tax paid.
Where regular books of accounts are maintained by an assessee, copies of manufacturing, trading account, profit & loss account or income & expenditure account or other similar account and balance sheet and in case of a proprietary business or profession, the personal account of the proprietor and in case of a partnership or association of persons or body of individuals, the personal accounts of the partners or members as the case may be and in the case of a partner of a partnership or member of an association of persons or body of individuals, the personal account of the partner or member in the partnership or association of persons or body of individuals as the case may be.
Where the accounts of the assessee have been audited, copies of the audited profit & loss accounts, balance sheet and auditor's report.
Where a cost audit has been conducted u/s 233B of the Companies Act, the cost auditor's report under that section.
Where regular books of accounts are not maintained by the assessee, a statement indicating the amounts of turnover or gross receipts, gross profits, expenses and net profits of the business or profession and the basis on which such figures have been computed along with the amounts of total sundry debtors, sundry creditors, stock-in-trade and cash balance as at the end of the previous year.
The return of income shall in prescribed cases require the assessee to furnish the particulars of income exempt from tax, assets of prescribed nature and value belonging to him, expenditure exceeding the prescribed limits and such other prescribed out-goings. It shall also be required of the assessee to furnish the particulars of the location and style of the principal place of business or profession and all branches thereof, the names, addresses and shares of his partners or fellow members in the firm or AOP or BOI in which he is a partner or member as the case may be.
The return of income must be furnished in the following forms:-
Form 1 in case of companies other than those claiming exemption under section 11
Form 2 in other cases (other than companies and those claiming exemption under section 11) whose total income includes income or loss under the head "Profits & Gains from business or profession"
Form 2A in case of a resident individual or HUF if his or its total income does not exceed Rs200,000 and does not include income chargeable under the head "profits & gains from business or profession" and does not include any brought forward or carried forward loss or allowance except under the head "Income from house property". However, form 2A is optional and return may be submitted in form 3
Form 3 in case of assessees (other than companies and those claiming exemption under section 11) whose total income does not include income or loss under the head "Profits & Gains from business or profession"
Form 3A in case of assessees including companies claiming exemption under section 11
Saral Form No 2D in case of non-corporate assessees other than those claiming exemption u/s 11
Form No 2C is applicable to those assessee who fall within the one out of six criteria of section 139 and who have not yet filed their return of income.
Permanent Account Number (PAN)
Section 139A deals with Permanent Account Number (PAN) Every person whose total income or the total income of any person in respect of which he is assessable under the Income Tax Act during any previous year exceeds the maximum amount which is not taxable, or every person carrying on any business or profession whose total sales, turnover or gross receipts are or is likely to exceed Rs50,000 in any previous year or every person who is required to furnish a return of income u/s 139 (4A) and who has not been allotted a PAN shall apply to the assessing officer in the prescribed manner within the prescribed time in the prescribed form (Form 49A) for allotment of the PAN.
The assessing officer may also allot to any person by whom tax is payable a PAN.
Any person not falling within the purview of the above provisions may apply to the assessing officer for a PAN and thereupon the assessing officer shall allot a PAN to such person.
The Board shall have the power for switching over to new series of PANs. PAN under the new series has been defined to mean a number, which will have ten alphanumeric characters to be issued on a laminated card. Assessing officer for this purpose includes an Income Tax authority to whom the job of allotting PAN has been assigned. The Board has the power to notify the places to be covered from time to time, the classes of persons to be covered and the period within which application for allotment of PANs must be made.
It shall be the duty of every assessee to whom a PAN has been allotted to quote that PAN in all correspondence, returns, challans under the provisions of income tax law and other documents pertaining to such transactions as may be prescribed by the Board in the interest of the revenue with the Income Tax Department.
Every person receiving any document relating to the prescribed transactions shall ensure that the PAN / GIR has been duly quoted in the document.
The Board has the authority to make rules in relation to the form and manner in which the application for allotment of a PAN and the particulars which such application will contain, prescribing the categories of transactions and the categories of documents pertaining to business or profession in which the PAN / GIR shall have to be quoted, class or classes of persons to whom the provisions of this section shall not apply, the form and manner in which the persons to whom PAN has not been allotted or who does not have a GIR no shall make declaration, the manner in which PAN / GIR shall be quoted in prescribed transactions and the time and manner in which prescribed transactions shall be intimated to the prescribed authority.
Section 140 deals with the persons who will have to sign the return of income. The return of income must be signed and verified:-
In the case of an individual, by the individual himself or where the individual concerned is absent from India, by the individual himself or by some person duly authorised by him in this behalf or where the individual is mentally incapacitated from attending to his affairs, by his guardian or a person competent to act on his behalf and where for any other reason, it is not possible for the individual to sign return, by a duly authorised person. Such persons shall hold a valid power of attorney, which must be attached to the return.
In case of an HUF, by the karta or where the karta is absent from India or is mentally incapacitated from attending to his affairs, by any other adult member of the family.
In case of a company, by its managing director or where for any unavoidable reason, such managing director is not able to sign or where there is no managing director, by any director of the company.
In case of a firm, by its managing partner or where for any unavoidable reason, such managing partner is not able to sign or where there is no managing partner, by any partner of the firm, not being a minor.
In case of a local authority, by the principal officer thereof.
In case of a political party, by the chief executive officer thereof, by whatever name called.
In case of any other association, by any member of the association or the principal officer thereof.
In the case of any other person, by that person or by any other person competent to act on his behalf.
In case of a non-resident company, by a person holding a valid power of attorney attached to the return.
In case of a company which is wound up, the liquidator of the company.
In case the management of the company has been taken over by the Central or State Government, the principal officer.
(Source :: indiainfoline)