Return of income is a special type of form to be used by the assesse to furnish necessary information – name, address, PAN/GIR No., Bank Account, income under each head, total income, tax liability, etc. before the income tax authority. Different types of forms are prescribed in Rule 12 of the Income Tax Rules, 1962 to be used by different categories of assesse.
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Person liable to submitting return of income
| Sections | Person liable to furnish return | Maximum income during the relevant assessment year |
| 139(1) | Company | Any amount of income or loss |
| 139(1) | Firm | Any amount of income or loss |
| 139(1) | Individual, HUF, AOP, BOI, Artificial Juridical person | If total income of such person or total income of any person in respect of which such person is assessable under the act exceeds the maximum amount not chargeable to tax. |
| 139(1) | Co-operative society or local authority | Any amount of income |
| 139(4A) | A person in receipt of income derived from property held under charitable or religious trust. | If total income of such person exceeds the amount chargeable to tax. |
| 139(4B) | Chief executive officer of every political party | I total income in respect of which the political party is assessable exceeds the maximum amount not chargeable to tax. |
| 35(1)(ii) & 35(1)(iii) | Every university, college, institutions | Any income or loss |
In case of company, a firm and university, college or other institution referred to in section 35(1) (ii) and (iii) furnishing of return of loss is compulsory as per the third proviso to section 139(1).
If the assesse is required to furnish return of income under section 139(1) but fails to do so, then he/she will be liable to interest under section 234A, penalty under section 271F and prosecution under section 276CC.
Section 139(1A) explains the scheme for bulk filling of returns by salaried employees. The provisions of this scheme are outlined as below;
1. This scheme is optional and provides an additional mode of furnishing returns of income by persons deriving income from SALARIES.
2. It shall be applicable to all ‘eligible employers’ and their ‘eligible employees’.
3. ‘Eligible employer’ means an employer who has a minimum of 50 employees and who has been allotted tax deduction account number.
Due date of furnishing the Income Tax returns
| Assessee | Due date |
| Company | Sep 30 of the relevant AY |
| Where the assessee is required to furnish a report under section 92E | Nov 30 of the relevant AY |
| Person other than company whose accounts are required to get audited under IT Act | Sep 30 of the relevant AY |
| Working partner of a firm | Sep 30 of the relevant AY |
| In any other case | July 31 of the relevant AY |
Prescribed Income Tax return forms
| Assessee | Form No |
| Individuals having income from salary, income from one house property and income from other sources. | SAHAJ (ITR-I) |
| Individuals & HUF not having income from business or profession | ITR – 2 |
| Individual & HUF being partners in a firm & not carrying out any business or profession under any proprietorship | ITR – 3 |
| Individual and HUFs deriving business income computed under section 44AD & 44AE | SUGAM (ITR – 4S) |
| Individual and HUFs having income from proprietary business and profession. | ITR – 4 |
| Firms, AOPs and BOIs | ITR – 5 |
| Companies other than companies claiming exemption under section 11 | ITR – 6 |
| Persons including companies required to furnish return under section 139(4A), 139(4B), 139(4C), 139(4D). | ITR – 7 |
The assesse who has sustained a loss in any previous year under the head ‘Profits and gains of business or profession’ or under the head ‘capital gains’ may furnish a return of loss on or before the due date in the prescribed form as mentioned in section 139(1). If such return is not submitted by the assesse then he is not entitled to carry forward and set off the following losses;
1. Loss from business or profession.
2. Loss under the head ‘capital gains’
3. Loss from the activity of owning and maintaining race horses.
Section 139(4) explains the concept of ‘Belated Return’.
If the assesse fails to submit return of income
1. Within the time allowed under section 139(1), or
2. Within the time specified in the notice issued under section 142(1).
He may submit a return (known as Belated Return) after the expiry of the said period but before the time mentioned below;
- The assesse may furnish a belated return at any time before the expiry of one year from the end of relevant assessment year or before the completion of assessment, whichever is earlier.
Section 139(5) allows an assesse to submit a revised return if the following conditions are satisfied;
- The assesse has furnished a return under section 139(1) or in pursuance of a notice issued under section 142(1);
- The assesse has not furnished the original return belatedly as per section 139(4),
- The assesse has discovered any omission or any wrong statement in the original return.
Time limit for submitting a revised return is same as belated return.
Section 139(9) says about defective return, the provisions of this section discussed below:
1. Return considered as defective: These provisions are applicable if the AO considers that the return of income furnished by the assesse is defective. Return of income shall be regarded as defective in the following cases:
- The annexures, statements and columns in the return of income have not been duly filled in.
- The return of income is not accompanied by certain documents like proof of payment of tax, proof of TDS, audit report u/s 44AB, copies of accounts.
2. The AO may intimate the defect to the assesse and give him appropriate time to rectify the return, this time limit will be of 15 days which may extend by the AO, in his discretion, on an application made by the assesse.
- Within the specified time limit, if the return is not rectified then it will be considered as invalid.
- According to section 139(9) defective return and invalid return are not same. If the return contains defects the return shall be treated as defective. If defect is not rectified by the assesse within the specified time, then the return shall be treated as invalid.
Income Tax Return by whom to be signed
| Assessee | Signed by whom |
| Individual | By the individual himself or by his authorized person, if he is absent from India;
By his guardian or any competent person, in case he is mentally incapacitated; By his dully authorized person, if for any other reason he is not able to sign the return. |
| Hindu undivided family | By karta, |
| Company | By managing director, any director, person holding power of attorney, liquidator, principal officer of the company (any one of them) |
| Firm | By managing partner, any other partner |
| LLP | By the designated partner, if not available then by any other partner. |
| Local authority | By the principal officer. |
| Political party | By CEO of such party. |
| Any other person | By member of the association or the principal officer. |
Section 139C has been inserted by the Finance Act, 2007 empowering the board to make rules for not submitting documents and statement with the return of income.
Section 140A outlined the provisions for self-assessment:
1. On the basis of any return required to be furnished under section 115WD or 115WH or 139 or 142 or 148 or 158BC it is required to find out whether any tax is payable before furnishing the return.
2. If any short payment made by the assesse, the amount so paid shall be first adjusted towards the interest payable and balance shall be adjusted towards the tax payable.
3. Interest u/s 234A shall be computed on the amount of tax on the total income declared.
Presumptive taxation scheme
Before going deep into the topic let us understand what presumptive is and reason for using it in taxation. PRESUMTIVE means having a good reason to believe that something is true means that it is presumptive. When collecting tax from public the government tries to implement the tax structure which is extremely simple so that the general public does not feel the burden to determine and pay taxes.
Salient features
- Simplification in relation to compliance burden on tax payer.
- Combat tax avoidance or evasion.
- Rebuttable presumptions can encourage taxpayers to keep proper accounts, because they subject taxpayers to a possibly higher tax burden.
- It considered desirable because of their incentive effects- a taxpayer who earns more income will not have to pay more tax.
Eligible business” means:-
- Any business except the business of plying, hiring or leasing goods carriages referred to in section 44AE;
- Whose total turnover or gross receipts in the previous year does not exceed Rs 2 crore
“Eligible assessee” means:
- An individual, Hindu undivided family or a partnership firm, who is a resident, but not a limited liability partnership firm as defined under section 2(1)(n) of the Limited Liability Partnership Act, 2008 .
- Who has not claimed deduction under any of the sections 10A, 10AA, 10B, 10BA or deduction under any provisions of Chapter VIA under the heading “C. – Deductions in respect of certain incomes” in the relevant assessment year;
Section 44AD shall not apply to:
- a person carrying on profession as referred to in section 44AA(1)
- a person earning income in the nature of commission or brokerage
- a person carrying on any agency business
References
Dhawan, S. (2020, july 13). income-tax/itr-filing. Retrieved from income-tax/itr-filing: https://www.financialexpress.com/money/income-tax/itr-filing-incomplete-due-to-non-submission-of-itr-v-form-cbdt-gives-one-time-relaxation-till-this-date/2022804/
rahul, d. (2020, aug 22). Know all about Presumptive Taxation Scheme under Income Tax. Retrieved from Know all about Presumptive Taxation Scheme under Income Tax: https://facelesscompliance.com/tag/know-all-about-presumptive-taxation-scheme-under-income-tax
Taxguru. (2019, oct 08). who is eligible for PTS. Retrieved from who is eligible for PTS: https://www.financialexpress.com/money/know-who-is-eligible-for-presumptive-taxation-scheme/1729385/
Team, T. (2020, May 26). Presumptive taxation- Section 44AD, 44ADA, 44AE. Retrieved from Presumptive taxation- Section 44AD, 44ADA, 44AE: https://taxguru.in/income-tax/income-tax-provisions-related-to-presumptive-taxation-under-sections-44ad-44ae-and-44af-in-a-brief.html
What is presumptive taxation scheme. ( 2018, Jun 07 ). Retrieved from What is presumptive taxation scheme: https://www.livemint.com/Money/B1IDYFwT0Xh329M7IPeDNM/What-is-presumptive-taxation-scheme.html
Author Bio
I have been wondering as to where the AO comes in particularly when the 143(1) is authenticated by CPC. I think someone needs to look into these aspects in the age of digitalisation.