Summary: Under Section 139(9) of the Income Tax Act, 1961, a return of income (ROI) deemed defective must be rectified within 15 days of the assessing officer’s (AO) intimation. Failure to correct the defect within this period, or any extension granted by the AO, renders the return invalid, treated as if it was never filed. In such cases, the taxpayer must submit a new return, classified as a belated return, which is subject to late fees under Section 234F. However, if defects are corrected after the deadline but before the assessment is completed, the AO has discretion to condone the delay, potentially accepting the original return as valid. In certain situations, taxpayers may mistakenly submit a revised return instead of a belated one, which could result in procedural complications. If the AO condones the delay in defect rectification, the originally defective return may still be considered valid, saving the taxpayer from late fees ranging from ₹1,000 to ₹5,000. It is crucial for taxpayers to ensure timely compliance and maintain clear communication with tax authorities to avoid penalties.
As per the Section 139(9) of Income Tax Act, 1961, Where the AO considers that the ROI furnished by the assessee is defective, he may intimate the defect to the assessee and give him an opportunity to rectify the defect within a period of fifteen days from the date of such intimation or within such further period which, on an application made in this behalf, the AO may, in his discretion, allow; and if the defect is not rectified within the said period of fifteen days or, as the case may be, the further period so allowed, then, notwithstanding anything contained in any other provision of this Act, the return shall be treated as an invalid return and the provisions of this Act shall apply as if the assessee had failed to furnish the return.
Defective Return: If a return is filed with defects and these defects are not corrected within the prescribed time frame, the return is treated as invalid. This essentially means it is as if the return was never filed.
Filing a New Return: If the return is considered invalid, the taxpayer must file a new return, which would be treated as a belated return. This belated return is subject to different rules and penalties including interest.
Rectification After Deadline: If the defects are rectified after the deadline but before the assessment is completed, the assessing officer may condone the delay. This means that the originally filed return could be considered valid if the defects are fixed within this time frame, even though the correction was made after the initial deadline.
Revised Return Issue: In many cases, taxpayers may inadvertently end up filing a revised return rather than a belated one after the deadline has passed. This could be due to misunderstandings or procedural issues.
Condonation of Delay: If the assessing officer condones the delay, the originally filed return might be accepted as valid. This can potentially save the taxpayer from additional late fees under Section 234F, which are ₹1,000 to ₹5,000 depending on the timing and nature of the delay.
In summary, while the rules require a new belated return if the original is invalid, there is some leeway if the defects are corrected after the deadline. If the assessing officer agrees to condone the delay, the original return could be accepted as valid, potentially saving the taxpayer from late fees. It’s always a good idea to keep clear records and communicate with the tax authorities to ensure compliance and address any issues promptly.
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