CA Sharad Jain

CA Sharad JainFee Under Section 234F For Default In Timely Furnishing of Income Tax Return– When Leviable and When Not

According to the Section 234F of the Income Tax Act a fee for non filing (or late filing) of the Income Tax Return within due date prescribed under section 139(1) of the Act is leviable. The same is leviable in respect of the I T returns for the Assessment Year 2018-19 and onwards.

The above fee is not leviable in respect of each and every case of non filing / late filing of return. The same is leviable only if the conditions as prescribed in section 234F are existing i.e., :

Condition 1 : There must be a mandatory requirement under section 139 of the Act to file the return ; and

Condition 2 : In those cases where there is a mandatory requirement, there must be a failure to file the return within the due date prescribed under section 139(1) i.e., 31st July / 30th September / 30th November.

In this regard, some considerable points are as under :

(i) In some cases, section 139 gives mere an option / opportunity to file return and do not mandate for the same. Therefore above fee may not be leviable if return is not filed / late filed in such cases e.g., revised return U/s. 139(5) etc.

(ii) In some cases, there is a mention in section 139 regarding filing of return but the due date for filing is not mentioned in section 139(1) but has been mentioned in other sections e.g., for filing revised return the due date is mentioned in section 139(5) itself and not in section 139(1). Therefore above fee may not be leviable if return is not filed / late filed in such cases.

(iii) Apart from section 139, there are also various other sections e.g., 148, 142(1), 153A etc. which requires mandatory filing of returns. The returns to be filed under those sections are treated as return required to be filed under section 139. However, the due date / last date for filing the same are not mentioned in section 139(1) but have been mentioned in those sections themselves i.e., section 148 etc. Therefore above fee may not be leviable if return is not filed / late filed in such cases.

(iv) Similarly, in cases where the return has been filed voluntary without any mandatory requirement for the same U/s. 139, the fee is not leviable.

All these cases mentioned in point no. (i) to (iv) above have been discussed in detail succeeding paras.

Here in this article, an attempt has been made (on the basis of analysis of section 139, 148, 142(1), 143A, 234F etc.) to summarize in a tabular form, the cases where the fee is leviable and where not leviable.

Type Of Assessee / Return Return Filing Liability U/s. 139 Return Filed Up To Due Date U/s. 139(1) Late Filing Fee under Section 234F Leviable or Not
Company (Original Return)

(Nil Income / Positive Income / Loss)

In every case there is a liability without any threshold limit of income No Late Filing Fee under Section 234F Leviable (even for nil income / loss return)
Firm (Original Return)

(Nil Income / Positive Income / Loss)

In every case there is a liability without any threshold limit of income No Late Filing Fee under Section 234F Leviable (even for nil income / loss return)
Individual, HUF, AOP, BOI, Artificial Judicial Person

(Original Return)

If total income before taking benefit of Chapter VI-A (i.e., 80C etc.), Section 10(38) i.e., LTCG of equity shares etc., 10A, 10B, 10BA exceeds basic exemption limit i.e., Rs. 2.50 lacs / 3 lacs / 5 lacs No Late Filing Fee under Section 234F Leviable (e.g., Gross Total Income of a non senior citizen is Rs. 2,60,000 and 80C deduction is Rs. 20,000 and Total Income is Rs. 2,40,000. The late fee is leviable for default. Please refer sixth proviso to Section 139(1) applicable w.e.f. 01.04.2006)

(Note : Loss Returns : The fee may not be leviable for late filing / non filing of loss return. It is so because filing of loss return is though mentioned in section 139 but is not mandatory. It is optional. As per section 139(3) it is required to be filed only for carry forward of losses U/s. 72. The claiming of carry forward is optional (a person may not wish to carry forward loss) hence filing of loss return is also optional. If loss return is not filed / late filed only the carry forward of loss is not allowable but the fee is not leviable.

 

Individual, HUF, AOP, BOI, Artificial Judicial Person

(Fourth Proviso To Section 139(1))

(Resident and Beneficial Owner Of Assets / Signing Authority In Account etc. Located Outside India not covered above)

(Original Return)

(Positive or Nil Income / Loss)

In every case there is a liability without any threshold limit of income No Late Filing Fee under Section 234F Leviable (even for nil income / loss return)
Charitable / Religious Trust, Society, Institution etc. (Section 139(4A) If total income before taking benefit of section 11 and 12 exceeds basic exemption limit i.e., Rs. 2.50 lacs. No Late Filing Fee under Section 234F Leviable (For loss return / below threshold limit income return fee is not leviable).

(Note : If not registered U/s. 12AA or not claiming benefit of Section 11 & 12 / become ineligible etc. then threshold limit for return filing liability is basic exemption limit).

University, Educational Institution, Hospital, Medical Institutions etc. claiming exemption U/s. 10 (Section 139 (4C)) If total income before taking benefit of section 10 exceeds basic exemption limit i.e., Rs. 2.50 lacs. No Late Filing Fee under Section 234F Leviable

(Note : If not claiming benefit of Section 10 / become ineligible then threshold limit for return filing liability is the basic exemption limit)

Political Party (Section 139(4B) If total income before taking benefit of section 13A exceeds basic exemption limit i.e., Rs. 2.50 lacs. No Late Filing Fee under Section 234F Leviable

(Note : If not claiming benefit of Section 13A / become ineligible then threshold limit for return filing liability is the basic exemption limit)

University, College etc. referred to in Section 35(1)(ii) & (iii), Business Trust and Investment Fund (Not covered above)

(Positive Income / Nil Income / Loss)

In every case there is a liability without any threshold limit of income No Late Filing Fee under Section 234F Leviable (even for nil income / loss return)
Revised Return (All Assesses) NA NA Late Filing Fee under Section 234F Not Leviable

(Note : The revised return is only optional and last date for filing the same is mentioned in a separate section i.e., 139(5) and not in section 139(1). Here both the conditions for levy of fee are not satisfied. Hence no fee is leviable for late filing of revised return.)

 

Defective Return Rectification (All Assesses) NA NA Late Filing Fee under Section 234F Not Leviable

(Note : Such return is only optional and last date for filing the same is mentioned in section 139(9) and not in section 139(1). Hence no fee is leviable for non submission / late submission of rectified return within 15 days time limit prescribed in section 139(9).)

(Note : However, due to non filing of rectified return in time, the original return filed U/s. 139(1) shall become invalid and where there was mandatory liability U/s. 139(1) for filing of valid original return, the fee may be leviable for non filing of original valid return.)

Return In Response To Notice U/s. 148 / 142(1) / 153A (All Assesses) NA NA Late Filing Fee under Section 234F Not Leviable

(Note : Though a return filed in response to these notices is treated as a return required to be furnished U/s. 139 but the due / last date furnishing is mentioned in section 148 etc. themselves and not in section 139(1). Thus, both conditions for levy of fee are not satisfied. Therefore, if return in response to notice U/s. 139(1) is not filed within time allowed in notice then fee is not leviable.)

(Note : However, where there was mandatory liability U/s. 139(1) for filing of original return, and the original voluntary return was not filed, then the fee may be leviable for non filing of original valid return.)

Conclusion : Thus, the fee is not leviable in each and every case. The same is leviable only if the above two conditions mentioned in section 234F are satisfied.

Disclaimer: The information contained in the above article are solely for informational purpose after exercising due care. However, it does not constitute professional advice or a formal recommendation. The author do not owns any responsibility for any loss or damage caused to any person, directly or indirectly, for any action taken on the basis of the above article.

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One response to “Section 234F Fee for delayed Furnishing of Income Tax Return– When Leviable & When Not”

  1. C.S.MADHURANATH says:

    WHERE A PARTNERSHIP FIRM WHICH COMES UNDER COMPULSORY AUDIT OF ACCOUNTS PERVIEW HAS GOT TIME TILL 30/09/2018 TO FILE THE RETURN WITHOUT ATTRACTING PENALTY. HOWEVER, A PARTNER IS SUCH A FIRM WHO HAS GOT OTHER BUSINESS INCOME HAS TO FILE THE RETURN BEFORE 31/07/2018.
    UNTIL AUDIT IS OVER, THE PARTNER MAY NOT GET THE TAXABLE AMOUNT PAID TO HIM.
    IN SUCH CASES HOW THIS PENALTY CLAUSE WORKS?

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