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u/s 139(9)/142(1)/148
Filing of Return under Section 139 (9) “Defective Return"
Defective return is the return of income which is rejected by the Income Tax Department due to certain defects. After the defects being identified by the department, a notice under section 139(9) is issued to assessee.
Some of the common errors that make a return Defective?
- Credit for TDS has been claimed but the corresponding receipts/income has been omitted to be offered for taxation,
- The gross receipts shown in Form 26AS, on which credit for TDS has been claimed, are higher than the total of the receipts shown under all heads of income, in the return of income.
- Gross Total Income and all the heads of income is entered as "nil or 0" but tax liability has been computed and paid.
- Name of taxpayer in ITR does not match with the "Name" as per the PAN data base.
- Taxpayer having income under the head “Profits and gains of Business or Profession” but has not filled Balance Sheet and Profit and Loss Account.
What to do next?
The assessee is required to rectify the defects within 15 days of notice and in case he fails to do so, the return is treated as invalid. In case assessee is unable to rectify the mistake within 15 days, then he can file an application in writing to AO for extension and if AO finds the reasons stated to be reasonable, then he may condone the delay.
What if don't respond to a Defective Notice?
If you fail to respond to the defective notice within stipulated period then your return may be treated as invalid and therefore consequences such as penalty, interest, non carry forward of losses, loss of specific exemptions may occur, as the case may be in accordance with the Income Tax Act.
Filing of Return under Section 142 (1)
Section 142(1) of the Income-tax act 1961 empowers Income-tax authorities to issue a notice for more clarification or for further details about where a return has been filed or if the return has not been filed, then to furnish the required information in a prescribed manner.
With the issuance of a notice under Section 142(1), the AO may request that the assessee
- Provide a return of income for which he/she is assessable if he/she has not filed the return of income within the customary time limit. It may contain a return for his or her own income or the income of another individual for whom he or she is liable to be assessed. In the case of a legal guardian or a deceased person.
- Provide accounts or documents in order to make an assessment.
- Provide Any other information, notes, or workings as desired by the AO.
In case an assessee does not comply with the provisions of Section 142
- It may result in the best judgement assessment under Section 144,
- A penalty under Section 271(1)(b), which is Rs. 10,000 for each failure, or
- Prosecution under Section 276D, which may extend up to a year and may attract a fine.
Filing of Return under Section 148
- income tax returns of an assessee.
- An individual's income tax return besides the assessee.
- The details of his/her income tax returns within such period, as may be specified in such notice.
- Remember, an assessee must furnish income tax returns within 30 days or a date specified in a notice.
Time limit to issue a notice under Section 148
A notice under Section 148 can be issued to a taxpayer within 3 years from the end of the relevant assessment year, If the escaped assessment amounts to or likely to amounts to less than Rs. 50,00,000. However, if the escaped income is Rs. 50,00,000 or more, the notice can be issued within ten years from the end of the relevant assessment year.
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