Within days after notifying the New ITR Forms, CBDT vide a Press release dated 09.01.2020 has rolled back the non-applicability clauses which were inserted through Notification 01/2020 dated 03.01.2020 by amending Rule 12 of the Income-tax rules, 1962.

This gives a major relief to taxpayers who jointly own House property or to those High spenders who have spent on Electricity or Foreign Travel in excess of Rs 100000 and Rs 200000 respectively by allowing them to avail the benefit of ITR-1 (Sahaj). Also, ITR-4 (Sugam) can now be availed by Joint property owners who wish to file their return under Presumptive taxation scheme.

So now only the format related changes stay effective in respect of the New Year Surprise by the CBDT. These include a few additional disclosures such as –

1. The new forms now ask you whether you hold an Indian passport. If you do, you will have to mention your passport number. This is applicable to both ITR-1 and ITR-4.

2. Additionally, in case of ITR-4, a major change in Financial details is that the figures of Cash and Bank are to be given in detailed (i.e. Opening Balance + Receipts during the year – Payments during the year = Closing Balance) as against the existing disclosure of only Closing balance as on the end of the financial year.

3. However, now there is no requirement to give the other Financial details of Unsecured Loans, Sundry Debtors and Creditors, Closing Stock which were required to be provided earlier in ITR-4.

This step taken by the Government will surely be welcomed by the Salaried and Presumptive Taxation class of assessees as it reinstates the relief provided to them to file these easier forms and thus have lesser compliance burden.

Now, it would be interesting to see whether the Department comes out with the utilities of the forms before the end of the FY as the format is already notified. This will allow the taxpayers to start filing their ITR for FY 19-20 from 1st April 2020 itself so that the compliance by all get smoothly completed by the due date i.e. 31st of July 2020.

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