Discover how to address a defective return notice (Section 139(9)) from the income tax department, ensuring accurate and timely responses.
Making a mistake or two is completely normal when you’re doing something you don’t often do or are not used to doing – like filing income tax returns. Sometimes we may miss entering certain information. Sometimes there could be an error. In these situations, your return is labeled as a ‘defective return,’ and the income tax department will issue a notice of defective return as per Section 139(9). This notice aims to help you correct any mistakes. However, if these issues aren’t fixed promptly, they could lead to some undesirable consequences. In this article, we will discuss scenarios that can result in your return being marked as defective, along with how to respond to the defective return notice u/s 139(9).
What is a Defective Return?
The tax authority sends out a defective return notice when they find mistakes or inconsistencies in your ITR. These mistakes might involve missing or conflicting information, errors in calculations, or other issues. The purpose of this notice is to prompt taxpayers to correct these errors and make sure that their tax return provides precise and complete information.
Defective return notice is issued under section 139(9) via an email to your registered email id. You can also access the same on the income tax e-filing portal.
Situations in Which Notice for Defective Return Will Be Issued
The Assessing Officer may consider the below-mentioned reasons, errors or omissions while issuing a defective return notice under section 139(9):
Incomplete Income Tax Return (ITR): If the ITR lacks necessary details in its annexures, statements, or mandatory columns, such as income from all sources are not mentioned etc.
Missing Tax Information: If taxes have been paid but their details are omitted in the ITR, including information about TDS, TCS, advance tax, or self-assessment tax.
TDS and Income Mismatch: TDS is claimed but corresponding income not offered for tax in the ITR. Eg: If you have earned interest income from term deposits and tax has been deducted by the bank, both interest income and tax deducted should be reported in the ITR. However, while filing return through Vakilsearch, all your income details will be auto-populated from the income tax department and there is also an option to upload 26AS which will help in preventing such discrepancies right from the start.
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Bookkeeping Issues: Incomplete or non-submission of mandated books of accounts, such as trading accounts, Profit and Loss accounts, Balance sheets, and others may lead to a defective return notice.
Income Tax Audit Concerns: If an audit is required to be done under section 44AB, the complete audit report, including profit and loss account, Balance sheet, auditor’s report, should be submitted. In the absence of these documents or submission of an incomplete audit report, you may invite a defective return notice.
Cost Audit Non-compliance: Failure to submit ‘Cost Audit‘ details as required by the Companies Act, 2013, can lead to a defective return notice.
Presumptive Taxation Inaccuracies: In cases of presumptive taxation, providing inaccurate computation of presumptive income, non-disclosure of relevant details, or mismatched gross receipts can trigger a defective return notice. Eg: For instance, gross receipts not mentioned in the Profit and Loss account, or the amount mentioned is more than ₹ 2 crore in ITR 4, will lead to a defective return notice.
Tax Payment Discrepancies: If taxes are partially paid or the paid amount doesn’t align with the tax liability in the ITR, a defective return notice may be issued.
Incorrect details in ITR: Filing an ITR with incorrect details regarding turnover, income limits, or inappropriate reporting for a specific head of income can lead to a defective return notice.
Mismatch in the name: When the name mentioned in the ITR does not match the name on the PAN card.
How Will I Receive Notice u/s 139(9)?
The IT Department will issue the notice u/s 139(9) to your email ID registered with the income tax department. The subject of the email will be ‘Communication under section 139(9) for PAN AWZXXXXXXX for the Assessment Year 2023-24’.
How to Respond to Defective Return Notice u/s 139(9)?
If the Assessing Officer considers the return to be defective, then a notice will be sent to the taxpayer. The taxpayer will have 15 days time to respond to the notice.
- Revise your return addressing the defects pointed out by the Income Tax Department within 15 days.
- If you are unable to complete these revisions within the given timeframe, you have the option to seek an extension.
If the defect is not rectified within a period of 15 days or the extended days allowed, your return may be treated as an invalid return. This could potentially lead to consequences like interest, penalty, non-carry forward of losses, forfeiture of specific exemptions.
How to Revise Your Income Tax Return in Response to the Notice
Follow these simple procedures to file a rectification request under Section 139(9):
- Log in to the Income Tax Department’s e-filing portal with your user ID and password.
- On the dashboard, select the ‘Rectification’ tab.
- Choose the assessment year for which you want to file a rectification request.
- Enter your user ID and password into the Income Tax Department’s e-filing system.
- Select the ‘Rectification’ tab from the dashboard.
- Select the assessment year for which you want to request Rectification.
Remembering that a correction request must be filed within the time frame specified by law is critical. This is usually within four years of the end of the tax year for which the return was submitted.
FAQs
What is Section 139 of the Income Tax Act, and what does it entail?
Section 139 of the Income Tax Act deals with the late filing of income tax returns in India. It outlines the due dates for filing returns, the consequences of late filing and the procedures for filing belated returns and revised returns.
How do I file an income tax return under Section 139 of the Income Tax Act?
You can file an income tax return under Section 139 of the Income Tax Act by visiting the Income Tax Department website or using an online tax filing platform. Here, you will need to provide your personal and financial information, including your income, deductions, and tax payments.
What is the due date for filing an income tax return under Section 139?
The due date for filing an income tax return under Section 139 varies depending on the type of taxpayer and the income earned. For individuals, the due date is usually July 31st of the assessment year. However, the due date may be extended by the government in certain circumstances.
What happens if I miss the deadline for filing my income tax return?
If you miss the deadline for filing your income tax return, you may be subject to penalties and interest charges. The amount of the penalty depends on the amount of tax owed and the length of the delay.
Can I file a belated return under Section 139(4) of the Income Tax Act?
Yes, you can file a belated return under Section 139(4) of the Income Tax Act. A belated return can be filed within one year from the end of the relevant assessment year or before the completion of the assessment, whichever is earlier.
What are the consequences of not filing an income tax return as required by Section 139?
The consequences of not filing an income tax return as required by Section 139 include penalties, interest charges, and legal action by the Income Tax Department.
How can I revise my income tax return if I made a mistake in my initial filing?
You can revise your income tax return if you made a mistake in your initial filing by filing a revised return under Section 139(5) of the Income Tax Act. A revised return can be filed within one year from the end of the relevant assessment year or before the completion of the assessment, whichever is earlier.
Are there any penalties or fines for incorrect or late filing under Section 139?
Yes, there are penalties and fines for incorrect or late filing under Section 139. The amount of the penalty depends on the amount of tax owed and the length of the delay.
Can I e-file my income tax return, and how does it work under Section 139?
Yes, you can e-file your income tax return under Section 139. E-filing allows you to file your return online using the Income Tax Department website or an online tax filing platform. You will need to provide your personal and financial information, including your income, deductions, and tax payments.
What documents and information do I need to file my income tax return under Section 139?
To file your income tax return under Section 139, you will need to provide your personal and financial information, including your income, deductions, and tax payments. You will also need to provide supporting documents, such as Form 16, Form 26AS and bank statements.
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