“Its better to be late than never”

Section 139 of the Income Tax Act 1961 consists of different subsections governing the due dates for filing of income tax returns under various categories. There are two different categories on the basis of which the due date of filing of income tax returns depends.

If the return is not filed within the stipulated due date as mentioned in the law, then both interest and penalty would be levied for late filing of income tax return.

Mandatory fees for late filing of Income Tax Return under Section 234F of the Income Tax Act 1961

Income Within Due date Upto 31st Dec 2018 Upto  31st March 2019
More than Rs. 5 lakhs Nil Rs. 5000 Rs. 10000
Upto Rs. 5 lakhs Nil Rs. 1000 Rs. 1000

It is to be noted that if the total income of the person  does not exceeds Rs. 5 lakhs then fee payable shall be Rs. 1000.

Both the interest and penalty levied are independent of each other. This implies that depending upon different situations, either one or both will be levied.

  • Interest @ 1% per month is leviable if the amount of advance tax is not paid as per the schedule prescribed under Income Tax Act.
  • The fees is levied on the late filing of the income tax return as per the threshold limit mentioned in the above table.

The levy of fees as mentioned in the table above has been made applicable from the current Assessment year only. Earlier there was no such provision under Income Tax Act 1961.  Earlier (upto A.y 2017-18) a penalty of Rs 5000 was imposed under section 271F if the  belated return was filed after end of the relevant assessment year.

From A.y  2017-18, a penalty of 50 percent of the tax payable shall be charged on under-reported income and 200 percent of such tax in case of misreporting of income under section 270A

Consequences of late filing/ non filing of Income Tax Return

1. Loss of interest on Refund in case the same is due to the assesee

2. Even a few of deductions are also not eligible to the assesse in case the return is filed after the due date

        3. If the return is filed beyond the `due date’ mentioned in section 139(1), few losses cannot be carried and set off against the income of subsequent years.

Not filing of Income tax returns on time can land you in jail. This can happen if the I-T authorities feel the assessee wilfully failed to furnish returns on time and the tax due is more than Rs 3,000. Under section 276CC of the I-T Act, if the amount of tax exceeds Rs 25 lakh, the assessee can be sentenced to rigorous imprisonment for anywhere between six months to seven years, and fined. In other cases, imprisonment can be between three months and two years, with fine.However, these penalties are levied in a very rare case. In most of the cases, the taxpayer is only required to pay interest @ 1% for late deposit of income tax

If TDS has been deducted from the income and the assessee has not filed ITR, then department can issue a notice under 142 (1) (i) for non-filing of returns. A penalty may also be levied by the assessing officer of Rs 5,000 for non-filing of income tax returns (upto A.y 2017-18). Wef A.y 2018-19   fees under section 234F shall be charged for non filing of return.”

Every taxpayer is required to file ITR if his/her total income exceeds the basic exemption limit. The department can issue you a notice under section 148 for income escaping the assessment for non-filing of ITR.

Other consequential effects of non filing of returns-

– Notice under sec 142(1)

– Best judgement assessment under Sec 144

– No loan no credit facilities from banks

– Credibility loss

– Ineligibility for various job positions such as judicial posts and class one officers

In order to save yourself from the huge amount of penalty/ interest and losing of various benefits , it is strongly suggested that the timely filing of return be ensured. The deadline for filing of income tax return is approaching  i.e. 31st July 2018. The timeline should not be missed as there are very few chances that this time the deadline will be extended for any cause or reason.

Checkout the Procedure of E- Filing Of Income Tax Return

Author Bio

Qualification: CA in Job / Business
Company: M/s SML Isuzu Ltd
Location: Chandigarh, Chandigarh, IN
Member Since: 10 May 2017 | Total Posts: 40
CA Rubneet Anand B.Com, M.Com(Finance& Taxation), MBA(Finance & International Business- IMT Ghaziabad) carubneetanand@gmail.com Deputy Manager (Internal Audit & Indirect Taxation)-M/s SML Isuzu Ltd Facebook Page- Corporate Prism-Consultation in Accounting & Corporate Managemen View Full Profile

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3 Comments

  1. Akshoy Das says:

    If income of an individual is not taxable before calculating the deduction under chapter VIA> is he liable to file Income Tax Return? (say his gross total Income is Rs. 1,80,000,00)

    1. CA Karan Arora says:

      Dear Akshoy das ji

      Reply to your query is “No”

      For your information, ITR filing is compulsory in case “your gross total income before allowing deductions under chapter VI A, exceeds the basic exemption limits i.e. 2.5 lacs (3 lacs in case of senior citizen, 5 lacs in case of super senior citizen)”

  2. GANDHI MOHAN BHARATI says:

    Sheer harassment. In my village, some Nidhi deducted Rs.73/- on a total payment of Rs.730/- in a year; Obviously, the Nidhi does not know the Rules. The Individual has got a notice. His total income is 27,000/- in a year. He is forced to reply and file a Return to always end up filing Returns for nothing.

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