AMIT BAJAJ ADVOCATE

Section 139(9) of Income Tax Act has been proposed to be amended in the Finance Bill 2013-14:

A. Existing provisions of section 139(9):

Under the existing provisions of the Income Tax Act, 1961, a Return of Income is regarded as defective unless it fulfils all the conditions laid down in sub-section (9) of section 139 of the Act.

B. Amendment proposed by Finance Bill, 2013:

The Finance Bill, 2013 proposes to insert clause (aa) in the Explanation to sub-section 9 of section 139 of the Income-tax Act, with effect from the 1st day of June, 2013, namely:—

A. Memorandum explaining the proposed Amendment: The existing provisions contained in sub-section (9) of section 139 provide that where the Assessing Officer considers that the return of income furnished by the assessee is defective, he may intimate the defect to the assessee and give him an opportunity to rectify the defect within a period of fifteen days. If the defect is not rectified within the time allowed by the Assessing Officer, the return is treated as an invalid return. The conditions, the non-fulfilment of which renders the return defective, have been provided in the Explanation to the aforesaid sub-section.

Section 140A provides that where any tax is payable on the basis of any return, after taking into account the prepaid taxes, the assessee shall be liable to pay such tax together with interest payable under any provision of this Act for any delay in furnishing the return or any default or delay in payment of advance tax, before furnishing the return.

It has been noticed that a large number of assessees are filing their returns of income without payment of self-assessment tax.

It is, therefore, proposed to amend the aforesaid Explanation so as to provide that the return of income shall be regarded as defective unless the tax together with interest, if any, payable in accordance with the provisions of section 140A has been paid on or before the date of furnishing of the return.

This amendment will take effect from 1st June, 2013.

B. Impact of the Amendment:

A Return of income is regarded as defective unless it fulfils all the conditions laid down in section 139(9) of the Income Tax Act, 1961. The Finance Bill, 2013 proposes to add one more condition stipulating that the return of income shall be regarded as defective unless the tax together with interest, if any, payable in accordance with the provisions of section 140A has been paid on or before the date of furnishing of the return.