MOST IMPORTANT FAQ OF INCOME TAX RETURN

MOST IMPORTANT FAQ OF INCOME TAX RETURN
Revised
FAQs on income tax returns
Q 1. What are the modes of filing return of
income?
Return of income can be filed in paper mode or in
e-filing mode. If return of income is filed through electronic mode, then the
assessee has following two options:
(1) E-filing using a Digital Signature
(2) E-filing without a Digital Signature
If return of income is filed by using a digital
signature, then there is no requirement of sending the signed copy ITR V (i.e.
acknowledgement of return filed electronically) to Bangalore CPC. However,
if the return is filed without using digital signature, then the assessee shall
send the signed copy of ITR V to CPC, Bangalore at below mentioned address.
Income Tax Department – CPC, Post Bag No -1, Electronic City Post Office,
Bangalore -560100, Karnataka
within 120 days of uploading the return either
by ordinary post or speed post only.

Q 2. When it is mandatory to file return of
income?
Every company is required to file return of
income. However, for an individual and HUF, it is mandatory to file return of
income if his/its gross total income (before claiming Chapter VI-A deduction)
exceeds the maximum exemption limit. The maximum exemption limit and the slab
rates for Assessment Year 2013-14 are given in the following table:
Class of persons
Tax slab(Amount)
Tax rate
Resident senior citizen (aged 60 years and above
but less than 80 years)
Up to Rs. 2,50,000
Nil
Rs. 2,50,000 to Rs. 5,00,000
10%
Rs. 5,00,000 to Rs. 10,00,000
20%
Above Rs. 10,00,000
30%
Resident super senior citizen (aged 80 years or
above)
Up to Rs. 5,00,000
Nil
Rs. 5,00,000 to Rs. 10,00,000
20%
Above Rs. 10,00,000
30%
Any other individual or HUF (i.e. other than
above)
 Up to Rs. 2,00,000
Nil
Rs. 2,00,000 to Rs. 5,00,000
10%
Rs. 5,00,000 to Rs. 10,00,000
20%
Above Rs. 10,00,000
30%
Q 3. Is it mandatory to file return of income, if
I have a PAN?
No, it is not mandatory to file return of income
if your income is less than maximum exemption limit irrespective of the fact
that you have been allotted a PAN.
Q 4. I am an Individual and resident of India. Do
I need to file return if my income is below taxable limit but I am having an
account in a foreign bank?
Yes, it is mandatory for you to file the income
tax return. In view of newly inserted proviso to Section 139(1), it is
mandatory to file income-tax return, if following conditions are satisfied:
(a)
The assessee is resident and ordinarily
resident in India;
(b)
He has any of following:
(i)
Signing authority in any account located
abroad;
(ii)
Any asset located abroad; or
(iii)
Financial interest in any entity located
abroad.
The assessee is required to provide requisite
details of such account, assets or financial interest in the return of income.
Q 5. Which form should I opt to file income-tax
return for the assessment year 2013-14?
Individual and HUF
Nature of income
ITR 1 (Sahaj)
ITR 2
ITR 3
ITR 4
ITR 4S (Sugam)
Income from salary/pension
Income from one house property (excluding
losses)
Income or losses from more than one house
property
Income not chargeable to tax which exceeds Rs.
5,000
Income from other sources (other than winnings
from lottery and race horses or losses under this head)
Income from other sources (including winnings
from lottery and race horses)
Capital gains/loss on sale of
investments/property
Share of profit of partner from a partnership
firm
Income from proprietary business/profession
Income from presumptive business
Details of foreign assets
Claiming relief of tax under section 90, 90A or
91
 
Other Assessees
Nature of income
ITR 5
ITR 6
ITR 7
Firm
Association of Persons (AOP)
Body of Individuals (BOI)
Companies other than companies claiming
exemption under Sec. 11
Persons including companies required to furnish
return under:
(1) Section 139(4A);
(2) Section 139(4B);
(3) Section 139(4C); and
(4) Section 139(4D)
 
ITR-1
Who can file return in ITR 1
Return in ITR 1 can be filed by an individual
if his total income includes:
(a) Salary or pension
(b) Income from one house property
(except brought forward loss under this head)
(c) Income from other sources (except
winnings from lotteries or horse races or losses under this head)
Who can’t file return in ITR 1
Return in ITR 1 cannot be filed by an individual
if he:
(a) Is resident and ordinarily resident
and has an asset located outside India or has signing authority outside India
(b) Has claimed any relief under Section
90 or 90A or 91
(c) Has income not chargeable to tax
which exceeds Rs. 5,000
ITR-2
Who can file return in ITR 2
Return in ITR 2 can be filed by an individual
and HUF if his/its total income includes:
(a) Salary or pension
(b) Income from more than one house
property (including losses
thereon)
(c) Income from capital gains
(d) Income from other sources (including
winnings from lotteries or horse races or losses under this head)
Who can’t file return in ITR 2
Return in ITR 2 cannot be filed by an
individual and HUF if he/it has income chargeable to tax under the head
‘Profit or gains from business or profession’
ITR-3
Who can file return in ITR 3
Return in ITR 3 can be filed by an Individual
or HUF deriving his/its share of profit as partner of firm.
ITR-4S
Who can file return in ITR 4S
 Return in ITR 4S can be filed by an
Individual or HUF deriving presumptive business income.
Who can’t file return in ITR 4S
Return in ITR 4S cannot be filed by a person
who:
(a) Is resident and ordinarily resident
and has an asset located outside India or has signing authority outside India
(b) Has claimed any relief under Section
90 or 90A or 91
(c) Has income not chargeable to tax
which exceeds Rs. 5,000
ITR-4
Who can file return in ITR 4
Return in ITR 4S can be filed by an Individual
or HUF deriving income from proprietary business or profession
Q 6. What are the due dates for filing of
income-tax return for the year ending March 31, 2013?
Assessee
Due date
An Individual or HUF
July 31, 2013
A Company
September 30, 2013
A person whose accounts are required to be
audited
September 30, 2013
A working partner of a firm whose accounts are
required to be audited
September 30, 2013
An assessee who is required to furnish a report
under Sec. 92E for international transaction
November 30, 2013
Any other person
July 31, 2013
Q 7. Whether it is mandatory to file return
electronically?
E-filing of return is mandatory for:
(a)
Every company;
(b)
A firm or an individual or HUF who are required
to get their accounts audited under section 44AB;
(c)
Every person claiming tax relief under Section
90, 90A or 91.
(d)
Every resident and ordinarily resident assessee
in India, if he has any of following:
(i)
Signing authority in any account located
abroad;
(ii)
Any asset located abroad; or
(iii)
Financial interest in any entity located
abroad.
(e)
A person other than a company and a person
required to furnish return in form ITR- 7, if his total income exceeds Rs. 5
lakh rupees during the previous year 2012- 13.
Q 8. How to file return electronically?
Income tax return can be filed electronically
with the help of following instructions:
(a)
Visit https://incometaxindiaefiling.gov.in;
(b)
Choose the appropriate ITR form suitable for
your status and source of income (Refer FAQ No. 5) and download excel utility
from the aforementioned website;
(c)
Fill the income-tax return in the downloaded
excel utility and generate XML file;
(d)
Use the following link to create your account:
https://incometaxindiaefiling.gov.in/e-Filing/Registration/RegistrationHome.html;
(e)
After creation of account, you need to login
and then click on “submit return” option;
(f)
Select the ‘assessment year’ and ‘form name’,
then click ‘next’;
(g)
Click on Browse option to select the generated
XML file and upload it;
(h)
On successful uploading, a pop-up menu will be
displayed on the screen. Click on “Download” button to get the
acknowledgement i.e. ITR-V;
(i)
The final step is to get the printout of such
acknowledgement, get it signed and send it to “Income Tax Department –
CPC, Post Bag No – 1, Electronic City Post Office, Bangalore – 560100,
Karnataka” within 120 days of uploading the return either by ordinary
post or speed post only.
If ITR-V is not submitted within stipulated
period of 120 days, then it will be deemed that assessee has not filed the
return of income.
The assessee who are required to file the ITR-1
may alternatively fill and file their return online without downloading the
excel utility after login at the incometaxindiaefiling.gov.in.
If assessee is using digital signature
(“DSC”) for uploading the return, it is to be registered on the
website beforehand. If return is filed through DSC, assessee would not be
required to send the print-out of the acknowledgement to CPC.
Q 9. What if I have forgotten the login details
of https://incometaxindiaefiling.gov.in?
(a)
Click on forget password or on the following
link (https://incometaxindiaefiling.gov.in/e-Filing/UserLogin/LoginHome.html);
(b)
Enter you user id (i.e., your PAN) and the
captcha (i.e. the security random code) and click on continue;
(c)
In the password reset page, one of the
following options can be selected:
(i)
Answer to the secret question;
(ii)
Upload the digital signature certificate; or
(iii)
Enter e-filed acknowledgment number or bank
account number as furnished in return of income.
(d)
Enter new password twice and click on ‘Reset
Password’ to generate new password;
(e)
If you are still unable to retrieve your
password then send an email request from registered email-id, to
validate@incometaxindia.gov.in with following details:
(i)
PAN;
(ii)
Name of the assessee as appearing on the PAN
card;
(iii)
Date of Birth/Date of incorporation;
(iv)
Name of father as appearing on the PAN card;
(v)
Registered PAN Address;
New password will be communicated to you by the
income-tax department via email.
Q 10. If the last date to file income-tax return
is a public holiday, whether the next day would be treated as “last date
of filing”?
Normally, income-tax department continues its
operation during the last days of filing of income-tax return even if the last
days eventually fall on Sundays or on holidays. However, if department is
closed on the last due date then the immediately next working day of the
department would be considered as the last date of filing of income tax return.
Q 11. How can I find my jurisdictional Assessing
Officer?
Either click on Services & Know your
Jurisdiction
given on the home page of incometaxindiaefiling.gov.in or use
the following link https://incometaxindiaefiling.gov.in/e-Filing/Services/KnowYourJurisdictionLink.html  to know your jurisdictional officer.
Q 12. How to know about TAN of my deductor?
It can be found either on the Form 16/16A or in
the 26AS tax credit statement available on https://www.tdscpc.gov.in/app/login.xhtml
TRACES (TDS Reconciliation and Correction Enabling System) website.
Q 13. How would I know whether my e-return has
been processed at CPC Bangalore?
Log on to the e-filing website and select CPC
processing status to check the status of return.
Q 14. I am the authorized signatory of the firm.
While filing the return of income I get an error that ‘PAN mentioned in
Verification section is invalid’.
In case of return of income of
firm/company/AOP/BOI/Artificial judicial person/Co¬operative society/trust
etc., PAN of authorized signatory is required to be filled in verification
field instead of the assessee’s PAN.
Q 15. I had e-filed my return and had identified
some mistake which seems to be a ‘mistake apparent from record’. Can I make
rectification with CPC in paper form?
No, the CPC doesn’t accept any of the manual
correspondence. You have to login to incometaxindiaefiling.gov.in and have to
file rectification request using web portal.
Q 16. What to do in case of TDS mismatch?
Even if the credit for TDS as claimed in the
return matches with the balance as appearing in the Form 26AS, still Assessing
Officer may raise a demand for payment of differential amount due to TDS
mismatch. The reason for such differences could be as under:
(1)
TAN of deductor was wrongly mentioned
(2)
Name of deductor was not spelt correctly
(3)
Tax deducted by one deductor wrongly included
in the amount of tax deducted by another deductor
In case of such TDS mismatch, an assessee can
file a rectification request.
Steps to file the rectification request:
(1)
Login to your account in
https://incometaxindiaefiling.gov.in
(2)
Go to My Account & Rectification request
(3)
You need the following to fill in the required
details:
(a)
PAN
(b)
Assessment Year
(c)
Latest Communication Reference Number (it
starts with CPC/Assessment Year/)
(d)
Latest CPC Order date
(4)
Click on Validate to go to next step
(5)
On the next screen, choose ‘Taxpayer is
correcting data for Tax Credit Mismatch Only’ from the drop-down box of
‘Rectification Request Type’
(6)
Check from the following relevant boxes for
which taxpayer is seeking rectification:
(a)
TDS on salary details
(b)
TDS on other than salary details
(c)
IT details
(7)
Fill in all the relevant details including
details of tax deducted and reported in the return of income filed earlier
(8)
Click on the button of ‘Submit’ to submit the
rectification request.
The TDS mismatch may also be due to error in TDS
return filed by deductor. In such a situation, you should intimate the deductor
about such error and require him to rectify the TDS return. However, if your
return is related to assessment year 2011-12 then it is advised to the assessee
to claim the actual tax deducted in the return and such mismatch would be
handled in accordance with Instruction No. 4/2012, in the following manner:
(a)
Where difference between TDS claimed and amount
reported in 26AS does not exceed Rs. 5,000, the claim shall be accepted;
(b)
Where even a single claim isn’t matching, the
credit shall be allowed only after due verification by department;
(c)
Where there are claims with invalid TAN, the
TDS credit for such claims is not to be allowed; and
(d)
In all other cases, the credit shall be allowed
after due verification by department.
Q 17. I have my return electronically and
furnished the signed copy of acknowledgment to the CPC. However, I have
received a letter from CPC that said copy of acknowledgement had not been
received. Since, time limit to resend the acknowledgement already expired,
whether it will be deemed that I have not filed the return.
The same issue has been dealt by Bombay High
Court in the case of Crawford Bayley & Co. v. Union of India [2011]
16 taxmann.com 323 (Bom.),wherein, the Court, despite expiry of the time limit
to send the acknowledgment, allowed additional time to assessee to resend the
same, since the assessee had furnished adequate material before the Court in
support of its contention that having filed return electronically, it had also
submitted ITR-V Form by ordinary post.
Based on the above, it can be inferred if you
have already submitted the ITR-V to the CPC then you can resend the
acknowledgement even though the time limit for filing ITR-V has already
expired, provided you have sufficient evidences to substantiate the fact that
you have send the acknowledgment earlier within 120 days of uploading the
return either by ordinary post or speed post only.
Q 18. Can I file the return even if the due date
to file the same has been expired?
Yes, you can file return of income belatedly
within a period of one year from the end of relevant assessment year or before
the completion of assessment whichever is earlier.
Q 19. What are the consequences of filing belated
return?
If return is filed after the end of relevant
assessment year, then in that case, penalty of five thousand rupees can be
levied under section 271F.
If the return of income is not filed within the
due date specified under section 139(1), then loss incurred during the year,
under the heads ‘Profits and gains of business and professions’ and ‘Capital
gains’ cannot be carried forward to next year.
Q 20. Can I file return of income even if my
income is below taxable limits?
Yes, you can file return of income voluntarily
even if your income is less than the maximum exemption limit.
Q 21. I have filed my return of income; however,
I omit to claim benefit of Section 80C deduction. What should I do?
The benefit of omitted claim can be availed only
by filing of revised return. But in that case you have to ensure that your
original return has been filed within the due date as return can be revised,
only if it has been filed originally within the specified due date. An
income-tax return can be revised within one year from the end of relevant
assessment year or before completion of assessment, whichever is earlier.
Q 22. I am a salaried person. My total taxable
salary is Rs. 5,40,000 on which tax has been duly deducted under Sec. 192
amounting to Rs. 39,140. During finalization of return, I found that my bank
has given me a credit of Rs. 124,500 towards interest. Please guide me what
should I do now?
In this situation, you have to pay the balance
taxes on the interest income (or any other income) before filing of return. As
per revised computation, your total tax liability would be Rs. 64,787. Since,
tax of Rs. 39,140 has already been deducted under Sec. 192, the balance tax of
Rs. 25,647 should be paid along with interest under Section 234B and 234C. The
tax and interest can be paid in any authorized bank, through Challan No. ITNS
280. Alternatively, it can be paid through online bank portal through following
link https://onlineservices.tin.nsdl.com/etaxnew/tdsnontds.jsp.
Q 23. What documents needed to be enclosed along
with the return of income?
Income-tax returns are annexure less. Hence, there
is no need to enclose any document(s) along with the return of income. Thus,
documents like TDS certificate, balance sheet, Profit & Loss A/c, Capital
A/c, proof of investments, etc. are not to be attached along with the return of
income. However, these documents should be retained and have to produce before
the Assessing Officer whenever required so.
Q 24. My employer has deducted tax without
allowing me relief of section 89. Now, can I claim the relief while filing the
return of income?
If the employer fails to provide relief under
section 89 and deducts excess tax, then you can claim such relief in your
return of income and can claim refund of excess tax deducted.
Q 25. How to claim deduction of donation given to
an organization registered under section 80G.
Deduction under section 80G can be claimed by
filing the return of income in which the following details needs to be given:
(a)
Name of donee;
(b)
PAN of donee;
(c)
Address of donee; and
(d)
Amount of donation.
Q 26. How to avoid deduction of tax, if during
the year, the accrued interest on deposit in my saving account is Rs. 15,000
and my total income including such interest income is below taxable limit.
You can file a self-declaration to the banker in
form 15H stating that your income is below taxable limit.
Q 27. Whether salaried persons are not required
to file return of income for assessment year 2013-14?
Exemption from filing return of income isn’t
available for salaried persons for assessment year 2013-14, as the benefit of
non-filing of return of income for salaried persons was allowed under
Notification No. 9/2012 only in respect of the assessment year 2012-13. No
similar notification for assessment year 2013-14 has been issued so far.
Therefore, every assessee earning income more than basic exemption limit shall
file the return of income.
Q 28. Whether all salaried class taxpayers can
choose ITR-1 for filing income tax returns?
No, all salaried class taxpayers can’t choose
ITR-1 for filing tax returns from assessment year 2013-14 onwards. They can
choose ITR-1 only if they are claiming exemption under sec. 10 (E.g. HRA,
Conveyance allowance etc) upto Rs 5,000 or less. So, if taxpayer is claiming
any exemption under sec. 10 which exceeds Rs. 5,000, they cannot file return of
income in ITR-1 (As per amended Rule 12 of income-tax rules).
Q 29. I omitted to submit rent receipt and
investment proof to my employer because of which relief for HRA and certain
other deductions weren’t given to me, the tax deducted from my salary income is
much higher than my actual tax liability. How to claim refund of such excess
tax?
Even if the benefit of HRA under Section 10(13A)
and deduction under Chapter VI-A are not considered by the employer in Form 16,
yet they can be claimed in the income-tax return. Accordingly, the excess tax
deducted by employer can be claimed as refund.
Q 30. Can I claim deduction under section 80C of
interest on housing loan?
Repayment of principal portion of residential
housing loan will be allowed as deduction under section 80C within the overall
limit of Rs. 1,00,000. However, such deduction is available if housing loan is
borrowed by assessee from:
(a)
Central Government or any State Governments
(b)
Banks, including a co-operative banks
(c)
LIC
(d)
National Housing Bank
(e)
Domestic Public company providing long-term
finance for construction or purchase of houses in India
(f)
Assessee’s employer being an authority or a
board or a corporation or any other body established or constituted under
Central or State Act
(g)
Assessee’s employer being a public company or a
public sector company or a university or a university established by law or a
college affiliated to such university or a local authority or a co-operative
society.
However, interest on housing loan is deductible
under section 24(b) while computing income chargeable to tax under the head
“Income from house property”.
Q 31. How to claim benefit of tax deducted in
advance on income which is taxable in subsequent years.
The portion of TDS credit, pertaining to income
taxable in the subsequent year, can be claimed through same TDS certificate.
[2013] 35 taxmann.com 418  (Article)
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