The existing provisions of section 239 of the Act provide inter alia that every claim of refund under Chapter XIX of the Act shall be made in the prescribed form and verified in the prescribed manner.
In order to simplify the procedure for claim of refund, it is proposed to amend the said section so as to provide that every claim for refund under Chapter XIX of the Act shall be made by furnishing return in accordance with the provisions of section 139 of the Act.
This amendment will take effect from 1st September, 2019.
[Clause 55]
Extract of Clause 55 of Finance Bill 2019
55. Amendment of section 239.
In section 239 of the Income-tax Act, with effect from the 1st day of September, 2019,––
(a) in sub-section (1), for the words “in the prescribed form and verified in the prescribed manner”, the words and figures “by furnishing return in accordance with the provisions of section 139” shall be substituted;
(b) sub-section (2) shall be omitted.
Note on Clause 55 of Finance Bill 2019
Clause 55 of the Bill seeks to amend section 239 of the Income-tax Act relating to form of claim for refund and limitation.
Sub-section (1) of the said section provides that every claim of refund under Chapter XIX of the said Act shall be made in such form and verified in the such manner as may be prescribed.
It is proposed to amend the said sub-section so as to provide that every claim for refund under the said Chapter shall be made by furnishing return in accordance with the provisions of section 139.
It is further proposed to omit sub-section (2) of section 239. These amendments will take effect from 1st September, 2019.
One question arises on the Section 239. While it permits to claim refund only through return, when an additional claim is raised under return, can AO deny the same if it is resulting into refund, as refund is not claimed under the return? If yes, it be argued that Section 239 is violative to article 265 of the Constitution, as the government has no authority to levy and retain taxes without authority of law?