All about Income Tax Return Including Updated Return under section 139(8A)

1. ALL ABOUT INCOME TAX RETURN INCLUDING UPDATEDRETURNUNDER SECTION139(8A) https://taxguru.in/income-tax/income-tax-return-including-updated-return-section-1398a.html In this Article, we will discuss about concept of ‘Updated Return‘ Introduced by Finance Act 2022. However, we will analyze the provisions & timelines in general to file Normal return, belated or revised return before discussing the concept of UPDATEDRETURN. GENERALPROVISIONS&TIMELINETOFILEINCOMETAXRETURN:Aspertheprovisionof section 139(1) of the Income Tax Act 1961, the following category of the taxpayer are mandatorily required to furnish the return of Income within the due specified duedate:

2. CATEGORY OFASSESSEE Company Firm MANDATORY/OPTIONAL Mandatory in allcases. Mandatory in allcases. Generally, Income Tax Return is mandatory infollow If total income of the person exceeds the maximu chargeable to Tax;or If total sales, turnover, or gross receipts of a bus INR. 60 Lakh in PY;or 3.IfgrossreceiptsofaprofessionexceedsINR.10 Any other person other than Company orFirm or Aggregate amount of TDS and TCS equal or m 25,000 in PY (in case of resident senior citizen the 50,000);or Total deposit in saving bank in aggregate is equal INR. 50 Lakh inPY. TIMELINE TO FILE INCOME TAX RETURN:The general timeline to furnish the return of income with tax authority is ashereunder:

3. CATEGORY OF ASSESSEE DUEDATES Any Assessee who requires to furnish report of Transfer Pricing 30th November of Assessment Year under section92E For– Company 31st October of Assessment Year AssesseehavingauditrequirementunderIncomeTaxActor any OtherLaw Others 31st July of AssessmentYear BELTED RETURN:If an assessee has not furnished the return of Income within stipulated time, they may furnish the return of Income at anytime: –At any time before 3 months prior to the end of the relevant assessmentyear. OR -At any time before the completion ofAssessment Whichever isEarlier. FEESUNDERSECTION234EFORDEFAULTINFURNISHINGRETURNOFINCOMEU/S139(1): Where the return of income filed after due date notified u/s 139(1) but on or 31st December of the Assessment Year, the late fee would be payable by the Assessee as per provisions of Section 234F. The situation and applicable late fees would be ashereunder: Failure Fees /Penalty INR.5,000 [ However, If the total income of the Assessee do INR. 5,00,000, the fee payable under this section sh INR.1,000.] Fee for default in furnishing ROI U/S139(1)

4. REVISE RETURN:If an assessee discovers any error, omission, or wrong statement in the return furnished u/s 139(1) or Section 139(4), they may furnish revised return at any point oftime: – Any time before 3 Month prior to the end of the relevant assessmentyear. OR -Any time before the completion ofAssessment- Whichever isEarlier. UPDATED RETURN:Reading the above provisions for furnishing the Return of Income, it appears that an additional time of approximately 5 months to an individual assessee, 2 months to a company/auditable assessee and 1 month to an assessee who enters an international transaction or specified domestic transaction respectively has been given for an assessment year to file belated or revised return. Since the given timeline for filing belated or revise return may not be adequate or to motivates the taxpayer towards the desired objective of voluntary tax compliance, Finance Act 2022 introduced new position under sub-section 8A of section 139 of The Income Tax Act 1961. The said amendment will come into force from 1st April2022. As per new provision of Section 139(8A) of Act “ Any person, whether or not he has furnished a return under sub-section(1), sub-section (4) or sub-section (5), for an assessment year, may furnish an updated return of his income in respect of which he is assessable under the Act, for the previous year relevant to such assessmentyear, within 24 months from the end of the assessment year. Such return shall be furnished in the FORM ITR-U and manner and shall contain prescribedparticulars’’. Example: For Financial year 2022-23 i.e., Assessment Year 2023-24, the assessee may file updated return till31 st March2026. WHEN UPDATED RETURN CANNOT BEFILED? Updated Return u/s 139(8A) cannot be filedwhen: Updated return will result into loss, or Updated return will result decrease in tax,or Updated return will result refund,or Updated return will result Increase inRefund WHO IS NOT ELIGIBLE FOR FILING UPDATEDRETURNS: The following person shall be not eligible to file updatedreturn If Search initiated under section 132 or Books of account, other documents or any assets has been taken into custody under section 132A in the case of such person,or IfSurveyhasbeenconductedundersection133A,otherthansubsection(2A)ofthatsection,inthecase such person,or IfAnoticehasbeenissuedtotheeffectthatanymoney,bullion,jewelleryorvaluablearticleorthing, seizedorrequisitionedundersection132orsection132Ainthecaseofanyotherpersonbelongsto

5. such person,or If A notice has been issued to the effect that any books of account or documents, seized, or requisitioned under section 132 or section 132A in the case of any other person, pertain or pertains to, or any other information contained therein, relate to, suchperson. Ifanupdatedreturnhasbeenfurnishedbyhimunderthesubsection(8A)ofsection139oftheActfor the relevant assessment year,or If Any proceeding for assessment or reassessment or recomputation or revision of income under the Act is pending or has been completed for the relevant assessment year in his case,or TheAssessingOfficerhasinformationinrespectofsuchpersonfortherelevantassessmentyearinhis possession under the Prevention of Money Laundering Act, 2002 or the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 or the Prohibition of Benami Property Transactions Act, 1988 or The Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 and the same has been communicated to him, prior to the date of his filing of return under the proposed sub-section (8A) of section 139 of the Act,or If Information for the relevant assessment has been received under an agreement referred to insections 90 or 90A of the Act in respect of such person and the same communicated to him, prior to the date of filing of return under the proposed sub-section (8A) of section 139 of the Act,or If Any prosecution proceedings under Chapter XXII have been initiated for the relevant assessmentyear in respect of such person, prior to the date of his filing of return under the proposed sub-section(8A) of section 139 of the Act,or If he is a person or belongs to a class of persons, as maybe notified by the board in thisregard. MANDATORYPAYMENTOFADDITIONALTAXBEFOREFILINGUPDATERETURNU/S 139(8A):A new section 140B has been Introduced to provide for the tax required to be paid for opting to file a return under the proposed provisions i.e., sub-section(8A) of section 139 of the Act. Further, Section 139(9) of the Income Tax Act also amended to provide that any updated return filed u/s 139(8A) without accompanied by proof of payment of tax as computed under section 140B shall be deemed to be the defective return. The summary of the additional tax payable along with Updated Return is ashereunder: Updated Return Timing Additional TaxPayable AfterExpiryofTimeallowedu/s139(4)oru/s139(5)butTwenty-fivepercentofaggregateoftaxand within Twelve month from relevantassessment year; payable, asdetermined AfterExpiryofTwelvemonthfromendofrelevantassessment Fiftypercentofaggregateoftaxandinterestpay year but within Twenty-Four month from end of assessmentyear; relevantdetermined MANNER TO DETERMINE ADDITIONAL TAXPAYABLE: SITUATION I –The tax payable to submit “Updated Return” will be calculated as hereunder, when no return of income filed by assessee u/s 139(1) & 139(4) of The Income TaxAct:

6. TIMING OF UPDATED RETURN WHERE NO ROI FURNISHEDEARLIER Tax Payable on totalincome [Netofadvancetax,TDS,TCS,reliefu/s89,90,90Axxx &91.] Add: Interest on totalincome xxx [ u/s 234A,234B &234C] After Expiry of Time allowedu/s within C. Add: Late Fee u/s234F 139(4) or u/s 139(5) but Twelve month from the relevant assessmentyear endof xxx D. Add: Additional tax u/s 140B@25% xxx [ (A +B)*25%] Totalpayable xxx [A + B + C +D] A. Tax Payable on totalincome xxx [Net of advance tax, TDS, TCS, relief u/s 89, 90, 90A &91.] B. Add: Interest on totalincome xxx [ U/s 234A,234B &234C] After Expiry of Twelve month from C. Add: Late Fee u/s234F xxx endofrelevantassessmentyearbut within Twenty-Fourmonth from D. Add: Additional tax u/s 140B@50% the end of relevant assessmentyear. xxx [ (A +B)*50%] Totalpayable xxx [A + B + C +D] SITUATION II –The tax payable to submit “Updated Return” will be calculated as hereunder, when return of income already filed by assessee u/s 139(1) & 139(4) of the Income TaxAct: TIMING OF UPDATED RETURN WHERE ROI FURNISHED EARLIER U/S139(1) or 139(4) OF THE INCOME TAX ACT1961

7. A. Tax Payable on additionalincome xxx [Netofadvancetax,TDS,TCS,reliefu/s89,90,90A &91.] After Expiry of Time allowed u/s B. Add: Interest on totalincome 139(4) or u/s 139(5)but xxx within [ u/s 234B &234C] Twelve month from the end of relevant assessmentyear C. Add: Additional tax u/s 140B@25% xxx [ (A +B)*25%] Totalpayable xxx [A + B +C] Tax Payable on additionalincome [Net of advance tax, TDS, TCS, relief u/s 89, 90, 90A &91.] Add: interest on additionalincome After Expiry of Twelve month from [ u/s 234B &234C] xxx end of relevant assessment yearbut within Twenty-Four month from the C. Add: Additional tax u/s 140B @50%xxx end of relevant assessmentyear. xxx [ (A +B)*50%] Totalpayable xxx [A + B +C] Recently, The Income Tax Authority has notified Form for filing “Updated Return” as form “ITR-U” on 29th April 2022 which can be download from https://taxguru.in/income-tax/cbdt-notifies-form-manner-filing- updated-return.htmlforreference. Apart from above, in view of the sub-section (8A) of section 139 and new section 140B, consequential amendments in section 144, section 153, section 234A and section 234B and 276CC have also has beenmade.