A new section 140B has been proposed to provide for the tax required to be paid for opting to file a return under the proposed provisions i.e., sub-section (8A) of section 139 of the Act.
These amendments will take effect from 1st April 2022.
In case of an assessee who has not furnished return of income u/s 139(1)/(4) earlier under the Act
(I) Where no return of income under sub-section or sub-section (4) of section 139 has been furnished by an assessee,
- he shall before furnishing the return under sub-section (8A) of section 139,
- be liable to pay the tax due together with interest and fee payable under any provision of the Act for any delay in furnishing the return or any default or delay in payment of advance tax, along with the payment of additional tax.
The tax payable shall be computed after taking into account the following: –
(i) the amount of tax, if any, already paid as advance tax;
(ii) any tax deducted or collected at source;
(iii) any relief of tax claimed under section 89;
(iv) any relief of tax or deduction of tax claimed under section 90 or section 91 on account of tax paid in a country outside India;
(v) any relief of tax claimed under section 90A on account of tax paid in any specified territory outside India referred to in that section; and
(vi) any tax credit claimed to be set off in accordance with the provisions of section 115JAA or section 115JD.
Such updated return shall also be accompanied by proof of payment of such tax, additional tax, interest and fee.
In summarizing form, refer below chart for better understanding: –
| S.No. | Particular | Amount |
| Tax due | XXX | |
| Add: | Interest u/s 234 A/B/C | XXX |
| Add: | Fees u/s 234 F | XXX |
| Total tax due | XXX | |
| Less: | Advance tax already paid | XXX |
| Less: | TDS/TCS | XXX |
| Less: | Relief of tax u/s 89/90A/90/91 (if any) | XXX |
| Less: | MAT credit u/s 115AA and AMT credit u/s 115JD | XXX |
| Additional Tax Payable | XXX |
In case of an assessee who has furnished earlier return of income u/s 139(1) or (4) or (5) under the Act
(II) In the case of an assessee, where, return of income under sub-section (1) or sub-section (4) or sub-section (5) of section 139 (referred to as earlier return) has been furnished by an assessee,
- he shall before furnishing the return under sub-section (8A) of section 139,
- be liable to pay the tax due together with interest and fee payable under any provision of this Act for any delay in furnishing the return or any default or delay in payment of advance tax, along with the payment of additional tax, as reduced by the amount of interest paid under the provisions of the Act in the earlier return,
The tax payable shall be computed after taking into account the following: –
(i) the amount of relief or tax, referred to in sub-section (1) of section 140A, the credit for which has been taken in the earlier return;
(ii) tax deducted or collected at source, in accordance with the provisions of Chapter XVII-B, on any income which is subject to such deduction or collection and which is taken into account in computing total income and which has not been claimed in the earlier return;
(iii) any relief of tax or deduction of tax claimed under section 90 or section 91 on account of tax paid in a country outside India on such income which has not been claimed in the earlier return;
(iv) any relief of tax claimed under section 90A on account of tax paid in any specified territory outside India referred to in that section on such income which has not been claimed in the earlier return;
(v) any tax credit claimed, to be set off in accordance with the provisions of section 115JAA or section 115JD, which has not been claimed in the earlier return.
The aforesaid tax shall be increased by the amount of refund, if any, issued in respect of such earlier return.
The updated return, furnished under sub-section (8A) of section 139, shall be accompanied by proof of payment of such tax, additional tax, interest and fee.
In summarizing form, refer below chart for better understanding: –
| S.No. | Particular | Amount |
| Tax due | XXX | |
| Add: | Interest u/s 234 A/B/C | XXX |
| Add: | Fees u/s 234 F | XXX |
| Total tax due | XXX | |
| Less: | Relief as given u/s 140A (1) {Simply refer above table} | |
| Less: | TDS/TCS (not claimed in earlier return) | XXX |
| Less: | Relief of tax u/s 90A/90/91 (if any) (not claimed in earlier return) | XXX |
| Less: | MAT credit u/s 115AA and AMT credit u/s 115JD (not claimed in earlier return) | XXX |
| Add: | The refund issued in respect of an earlier return filed | XXX |
| Additional Tax Payable | XXX |
Caping on minimum 25% or 50% as the case may be of additional income tax required to be pay by assesse in case if he opt to furnish return of income u/s 139(8A)
(III) The additional tax, payable at the time of furnishing the return under sub-section (8A) of section 139, shall be equal
→ to 25% of aggregate of tax and interest payable, as determined in sub- paragraphs I or II above,
→ if such return is furnished after expiry of the time available under sub-section (4) or subsection (5) of section 139 and
→ before completion of period of 12 months from the end of the relevant assessment year.
However,
→ if such return is furnished
→ after the expiry of 12 months from the end of the relevant assessment year
→ but before completion of the period of 24 months from the end of the relevant assessment year, the additional tax payable shall be 50% of aggregate of tax and interest payable, as determined in sub- paragraphs I or II above.
Explanation.––For the purposes of computation of “additional income-tax”, tax shall include surcharge and cess, by whatever name called, on such tax.
Calculation of interest u/s 234B on assessed tax, following points required to be taking into account
(IV) It is further provided that notwithstanding anything contained in the Explanation 1 to section 234B,
→ in the cases where an earlier return has been furnished,
→ interest payable under section 234B shall be computed
→ on an amount equal to the assessed tax or, as the case may be, on the amount by which the advance tax paid falls short of the assessed tax, where, “assessed tax” means the tax on the total income as declared in the return to be furnished under sub-section (8A) of section 139, after taking into account the following:
(i) the amount of relief or tax, referred to in sub-section (1) of section 140A, the credit for which has been taken in the earlier return;
(ii) tax deducted or collected at source, in accordance with the provisions of Chapter XVII-B, on any income which is subject to such deduction or collection and which is taken into account in computing such total income and which has not been claimed in the earlier return;
(iii) any relief of tax or deduction of tax claimed under section 90 or section 91 on account of tax paid in a country outside India on such income which has not been claimed in the earlier return;
(iv) any relief of tax claimed under section 90A on account of tax paid in any specified territory outside India referred to in that section on such income which has not been claimed in the earlier return;
(v) any tax credit claimed, to be set off in accordance with the provisions of section 115JAA or
section 115JD, which has not been claimed in the earlier return. The aforesaid tax shall be increased by the amount of refund, if any, issued in respect of such earlier return.
Interest u/s 234A shall be computed on the return income under this section
Where no earlier return has been furnished,
→ the interest payable under section 234A
→ shall be computed
→ on the amount of the tax on the total income
→ as declared in the return under sub-section (8A) of section 139.
Further, interest payable under section 234C,
→ where an earlier return has not been furnished,
→ shall be computed after taking into account the income furnished in the return under sub-section (8A) of section 139 as the returned income.
At the same time,
→ for the computation of additional tax above,
→ the interest payable shall be interest chargeable under any provision of the Income-tax Act,
→ on the income as per return furnished under sub-section (8A) of section 139, as reduced by interest paid in the earlier return, if any. However, the interest paid in the earlier return shall be considered to be nil if no earlier return has been furnished.
In view of the proposed sub-section (8A) of section 139 and new section 140B, consequential amendments in section 144, section 153, section 234A and section 234B and 276CC have also been made.
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