What To Do If Wrong Assessment Year Is Entered In Income Tax Challan

Learn what to do if the wrong assessment year is entered in an income tax challan. Understand the process for correction and adjustment of refunds.

Humans are prone to mistakes. Many a times due to many unavoidable reasons assessment year is wrongly entered in challan due to which demand is raised and also gets adjusted against refund of subsequent years if any.

What Happens If Challan Is Paid in Wrong Assessment Year?

Normally, the challan paid is reflected in Form 26AS/AIS of taxpayer. If A.Y. is wrongly entered in challan then amount paid in challan is shown in 26AS of different year. For Example : If tax of Rs.100000/- for A.Y.2020-21 is wrongly paid in A.Y.2017-18, then tax paid of Rs.100000/- will be shown in 26AS/AIS of A.Y.2017-18 and demand of Rs.100000/- plus interest say Rs.10000/- i.e.110000/- will be raised in A.Y.2020-21. Further if there is refund computed in A.Y.2022-23 of Rs.200000/- then demand of Rs.110000/- will be adjusted against refund of Rs.200000/- and only balance Rs.90000/- will be received by taxpayer.

What To Do If A.Y. Entered in Challan Is Wrong?

In that case write a letter to Jurisdictional Assessing Officer for correction in challan along with enclosures and submit it to Income Tax Office requesting to correct the A.Y. wrongly entered in challan. Remember, here banks cannot do any rectification. You have to visit to Income Tax Department. Once rectification is done by concerned Assessing Officer, the challan paid of Rs.100000/- will be correctly shown in 26AS/AIS of A.Y.2020-21.

How To File Response Against Outstanding Demand And Refund Adjusted?

You have two options-

1. Write letter to Jurisdictional Assessing Officer.

2. File Rectification u/s. 154 online through income tax portal if you do not wish to visit to department.

It is always advisable to file rectification online.

Our Comments: The taxpayers should be very careful while filling the Challans. If mistake happens then demand is raised unnecessarily because of non-reflection in form 26AS/AIS. However, you have an option to file rectification online. It is always advisable to take help of experts in solving these cases.

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Disclaimer: The above comments do not constitute professional advice. The Author can be reached at contact@financialtreecompany.com. My name is CA Divya Agrawal and I am Practising Chartered Accountant, CEO and Founder of FINANCIAL TREE COMPANY (An online return filing and Tax Consultancy Company). We also upload educational videos in You tube and name of our channel is FINANCIAL TREE COMPANY. Our aim is to help people in improving their financial health by spreading knowledge and love. Stay Financially Fit and Healthy.