Belated Return – Filing of Return after due date – Section 139 (4)

What is a Belated return?

A belated return is a return of income filed after the due date of filing of Income-tax return as prescribed in the Income-tax law.

Although the term ‘Belated Return’ is not defined in the Income-tax law. The law relating to belated return is given under sub-section 4 of section 139 of the Income-tax law. As per section 139 (4) of the Income-tax act says:

If a person has not filed his return of income within the time allowed under section 139 (1) then he may file, the return of income at any time:

  • Before the end of the relevant assessment year, or
  • Before the completion of the assessment

Whichever is earlier.

What is the meaning of the end of the Relevant Assessment Year?

Relevant Assessment Year (AY) means the assessment year for any Previous Year for which the return of Income is to be filed. For example:

If Mr. Gupta wishes to file his return for FY 2020-21 for which the relevant assessment year is AY 2021-22 and he could not file the same within the time allowed under section 139 (1) (i.e. the prescribed due date of filing an Income tax return). He can file his return up to the end of the relevant assessment year i.e. March 31, 2022.

Completion of Assessment

The phrase ‘Completion of assessment’ is not defined under the Income tax law. It derives its meaning from the various judgement by courts. In general, an assessment can be said to have been completed when the order of assessment is passed.

Other Frequently Asked Questions (FAQs) in relation to Belated Return

  1. If Mr. Gupta has made any mistake in the belated return filed by him, whether the same can be corrected by revising the belated return? Or

Whether a belated return can be revised?

Answer: Yes, a belated return can be revised. The time limits for the same are mentioned under section 139 (5) (Revised Return) which deals with the provisions of revising a return of income.

  1. Is Mr. Gupta required to pay any Interest if he is going to file a belated return?

Answer: Yes, interest under section 234A of the Income-tax act is required to be paid on the taxes unpaid or paid after the relevant due dates of payment of tax @1% per month on the simple interest basis. For the purpose of this calculation, part of the month will be treated as a full month.

In case, where Mr. Gupta has paid all the taxes in time, there is no requirement of payment of any interest under section 234A even when the return is filed as a Belated return.

  1. Is Mr. Gupta required to pay any penalty if he is going to file a belated return?

Answer: Yes, for the belated return filed, there is a fee to be paid under section 234F of the income tax act, which says the following:

  1. 5000, if the return is furnished on or before on the 31st December of A.Y.
  2. 10,000 in any other case.
  3. However, this fee will not exceed 1,000 in the case of a person whose Total Income does not exceed Rs. 5 lakhs

 

  1. Whether a refund can be claimed through a belated return?

Answer: Yes, a refund can be claimed through a belated return.

  1. Whether a loss is eligible to be carried forward if filed through a belated return?

Answer: No, a loss under head Profit and gains from business or profession and capital gains can not be carried forward if the return of income is filed after the due date.

However, the loss under head ‘Income from House property’ can be carried forward if return of income is filed after the due date.

Unabsorbed Depreciation can also be carried forward if the return of income is filed after the due dates as mentioned in Section 139 (1).

  1. Is set-off of losses carried forward from earlier years is allowed if the return is filed as a belated return?

Answer: Yes, the setoff of losses is allowed even if the return of income is filed after the due date.

 

Disclaimer: The above-mentioned cases are illustrative and not exhaustive. This article is only for discussing general issues and hereby we do not express any opinion or give any consultation in what so ever manner understood. The cases may differ from assessee to assessee. We recommend you to take expert advice depending upon your particular case.

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