Every assessee is mandatorily required to file its return of income notwithstanding his/its total income exceeds the basic exemption limit. A study of below provisions will help Taxpayee to find out the correctness or otherwise of the following queries/statements. The statements given hereunder are to enable you to check your understanding of the provisions:
There are 9 types of Income Tax Returns filed under section 139 of Income Tax Act, 1961 namely -
- Mandatory Return & Voluntary Return
- Loss Return
- Belated Return
- Revised Return
- Return of Income of a Public Charitable/Religious Institute
- Return of a Political Party
- Certain specific institutions claiming benefit under section 10 of the Income Tax Act 1961.
- Institutions referred to in Section 35(1)(ii) or 35(1)(iii) of the Income Tax Act 1961.
- Defective Return.
The Mandatory Return & Voluntary Return filed under section 139 (1) of the Income Tax Act, 1961.
A ‘mandatory return’ is required to be filed by the following:
- Every company (whether domestic or foreign, public or private) Every company (whether domestic or foreign, public or private)
- Every firm (it includes unlimited liability partnership firm as well as LLP)
- Every other person if his/its total income* for the relevant financial year exceeds the basis exemption limit.
*The term total income means total income computed before allowing the benefit of provisions of chapter VI-A and 10A/10B/10BA.
Where a person files his/its return of income even where he/it is not required to file a mandatory return, such return can be said to be a ‘voluntary return’. It may be noted that a voluntary return is also a valid return.
The Loss Return covered under section 139(3) of the Income Tax Act, 1961.
If an assessee has income under the head ‘profits & gains of business or profession’ or under the head ‘capital gains’ he/it shall be required to file its return of income any time before the expiry of the time limit of section 139(1). If he/it does not do so the right of carry forward of relevant loss shall not be available however set-off benefit still does not hamper.
A reading of section 139(3) also reveals that losses under the head house property as well as unabsorbed expenses like section 32(2) does not effect on account of delayed filing of return of income.
The Belated Return filed under section 139(4) of the Income Tax Act, 1961.
Where a person files his/its return of income even where he/it is not required to file a mandatory return, such return can be said to be a ‘voluntary return’. It may be noted that a voluntary return is also a valid return.
The Loss Return covered under section 139(3) of the Income Tax Act, 1961.
If an assessee has income under the head ‘profits & gains of business or profession’ or under the head ‘capital gains’ he/it shall be required to file its return of income any time before the expiry of the time limit of section 139(1). If he/it does not do so the right of carry forward of relevant loss shall not be available however set-off benefit still does not hamper.
A reading of section 139(3) also reveals that losses under the head house property as well as unabsorbed expenses like section 32(2) does not effect on account of delayed filing of return of income.
The Belated Return filed under section 139(4) of the Income Tax Act, 1961.
Where an assessee could not file a return within the time limit provided under section 139(1), he can file a belated return within 1 year from the end of relevant assessment year or before completion of the assessment whichever is earlier.
It must be noted the before completion of assessment means that before making of an assessment under section 144.
A belated return may attract penalty under section 271F of the Income Tax Act 1961 of Rs. 5,000/-. But a return of income which was not mandatorily required to be filed under section 139(1) shall not attract penalty even if it is filed after the expiry of the assessment year.
The important part for every assessee is that Revised Return, Revised Return filed under section 139(5) of the Income Tax Act, 1961.
Where an original return filed by the assessee under section 139(1) or 142(1)(i) has certain ‘omission’ or ‘wrong statement’ in it, the assessee can certainly file a revised return within 1 year from the end of relevant assessment year or before completion of assessment whichever is earlier.
It may therefore be noted that a belated return can’t be revised but a loss return if filed within section 139(1) time limit can also be revised.
Another one Return of Income of a Public Charitable/Religious Institute covered under section 139(4A) of the Income Tax Act, 1961.
It must be noted the before completion of assessment means that before making of an assessment under section 144.
A belated return may attract penalty under section 271F of the Income Tax Act 1961 of Rs. 5,000/-. But a return of income which was not mandatorily required to be filed under section 139(1) shall not attract penalty even if it is filed after the expiry of the assessment year.
The important part for every assessee is that Revised Return, Revised Return filed under section 139(5) of the Income Tax Act, 1961.
Where an original return filed by the assessee under section 139(1) or 142(1)(i) has certain ‘omission’ or ‘wrong statement’ in it, the assessee can certainly file a revised return within 1 year from the end of relevant assessment year or before completion of assessment whichever is earlier.
It may therefore be noted that a belated return can’t be revised but a loss return if filed within section 139(1) time limit can also be revised.
Another one Return of Income of a Public Charitable/Religious Institute covered under section 139(4A) of the Income Tax Act, 1961.
The details of Return of Income of a Public Charitable/Religious Institute is as under :
Institutions claiming exemption under section 11 & 12 of the Income Tax are required to file their return mandatorily if their total income before giving effect to provisions of section 11 &12 exceeds the basic exemption limit.
The Income Return of a Political Party is filed under section 139(4B) of the Income Tax Act, 1961.
A political party is required to file its return of income mandatorily if its total income exceeds the basic exemption limit without giving benefit of section 13A of the Income Tax Act 1961.
Income Tax Return Under section 139(4C) & 139(4D) is applicable for Certain specific institutions claiming benefit under section 10 of the Income Tax Act 1961.
An institution claiming exemption under clause (21), (22B), (23A), (23B), (23C), (23D), (23DA), (23FB), (24), (46) or (47) of section 10 is required to mandatory files its return of income if its total income exceeds the basic exemption limit without giving benefit of exemption.
Income Tax Return Under section 139(4D) is for Institutions referred to in Section 35(1)(ii) or 35(1)(iii) of the Income Tax Act 1961.
An institution referred to in section 35(1)(ii) or (iii) are required to mandatory file their return of income.
And at the end Defective Return is filed under Section 139(9) of the Income Tax Act, 1961.
A defective return is a return which contains certain defect mentioned in the Explanation to section 139(9). A return of income shall be regarded as defective unless the following conditions are fulfilled:
Institutions claiming exemption under section 11 & 12 of the Income Tax are required to file their return mandatorily if their total income before giving effect to provisions of section 11 &12 exceeds the basic exemption limit.
The Income Return of a Political Party is filed under section 139(4B) of the Income Tax Act, 1961.
A political party is required to file its return of income mandatorily if its total income exceeds the basic exemption limit without giving benefit of section 13A of the Income Tax Act 1961.
Income Tax Return Under section 139(4C) & 139(4D) is applicable for Certain specific institutions claiming benefit under section 10 of the Income Tax Act 1961.
An institution claiming exemption under clause (21), (22B), (23A), (23B), (23C), (23D), (23DA), (23FB), (24), (46) or (47) of section 10 is required to mandatory files its return of income if its total income exceeds the basic exemption limit without giving benefit of exemption.
Income Tax Return Under section 139(4D) is for Institutions referred to in Section 35(1)(ii) or 35(1)(iii) of the Income Tax Act 1961.
An institution referred to in section 35(1)(ii) or (iii) are required to mandatory file their return of income.
And at the end Defective Return is filed under Section 139(9) of the Income Tax Act, 1961.
A defective return is a return which contains certain defect mentioned in the Explanation to section 139(9). A return of income shall be regarded as defective unless the following conditions are fulfilled:
- The annexure, statement and columns in the return have been duly filled in.
- The tax together with interest, if any. Payable in accordance with section 140A has been paid on or before the date of furnishing return.
Where the Assessing Officer considers that the return of income furnished by the assessee is defective, he may intimate the defect to the assessee and give him an opportunity to rectify the defect. If the assessee rectifies the defect within the permitted or extended period the return shall be treated as valid otherwise it will become invalid.
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