Filing of Income Tax Return without paying Self Assessment Tax makes it defective

Present provisions of section 139(9) of the Income Tax Act:

The present provisions of section 139(9) of the Income Tax Act contain the conditions the lack of which makes the return furnished by the assessee a defective one.

Proposed amendment:

The Finance Bill aims to amend section 139 of the Income Tax Act dealing with return of income. Clause 32 of the Bill states that in section 139 of the Act, in sub-section (9), after clause (a), the following clause is to be added –

(aa) the tax along with interest, if any, which should be paid according to the provisions of section 140A, has been paid within the date of filing of the return.

The proposed amendment aims to make the return of income defective if the tax together with interest is not paid according to the provisions of section 140A of the Income Tax Act on or before the date of filing of the return.

Date from which the amendment shall be effective: The said amendment shall be effective from the first day of June, 2013.

Correction of a defective return:

If any return of income is not signed by signatory as provided section 140, making it defective, the same can be rectified under section 139(9) of the Income Tax Act.

Procedure followed by the Department in case of defective return:

Recently the Income Tax Department is giving notice for a defective return under section 139(9) to the assessee.

Consequences of receiving a notice under section 139(9) :

If the Assessing Officer thinks that a return is defective, he may inform the same to the assessee through a notice under section 139(9) giving him an opportunity to cure the defect within 15 days from the receipt of such notice.

The assessee is also permitted to extend the time upon making application. If the said defect is not rectified within the said time or the extended time, the return shall become void or invalid. In such case it shall be considered that no return of income has been filed by him.

When the assessee cures the defect after the said time period or the extended one but before the completion of assessment, then the Assessing Officer has the liberty to consider the return as a valid one.

Effects of the proposed amendment:

An income tax return becomes defective if all the conditions of section 139(9) are not followed. The new proposed amendment imposes another condition upon filing of return. It makes a return defective if the self assessed tax is not paid with interest, if any, payable according to the provisions of section 140A of the Income Tax Act, along with the return.