Section 139 of the Income Tax Act

Section 139 of the Income Tax Act deals with late income tax return filing. So, if an individual fails to file an income tax return in the given timeline, section 139 becomes applicable. Here we will discuss all the subsections of section 139 and various conditions related to this section and its subsections.

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Different Subsections of Section 139 of the Income Tax Act, 1961

Various subsections of section 139 deal with different types of income tax returns that can be filed under it. A quick overview of these subsections is mentioned below:

  1. Section 139(1) of the Income Tax Act - Mandatory and Voluntary Returns:

    Section 139(1) of the Income Tax Act closely deals with the mandatory and voluntary filing of income tax returns by taxpayers:

    Mandatory Returns: The taxpayers who are needed to file mandatory income tax returns are mentioned below:

    • Any LLP or Limited Liability Partnership and unlimited liability partnership.

    • Any domestic, private, public, or domestic company.

    • Any individual whose total income exceeds the tax exemption limit.

    • Any HUF (Hindu Undivided Family), AOP (Association of Persons), and BOI (Body of Individuals) whose income exceeds the prescribed exception limit.

    Voluntary Returns: If an individual doesn't need to file an income tax return, then the income tax filed by that person is termed a voluntary return. In this way, voluntary returns are also known as valid returns of income tax.

    Note: As per Section 139(1C) of the Income Tax, some people are exempted from income tax filing. However, this is possible only when people of such classes fulfill some mentioned conditions, then the Central Government can exempt them from tax.

  2. Section 139 (3) - Loss Return:

    If a firm or company encounters loss, Section 139(3) deals with its income tax return. Therefore, it is beneficial to file for a return in the case of losses. If an individual or a firm file a return on losses, these losses are allowed to be carried forward, which ultimately reduces the tax liability of the taxpayer in the following years.

    • For an individual taxpayer, the tax return is not mandatory for the loss incurred in the previous financial year. However, for companies, a tax return for losses is mandatory.

    • If the incurred losses fall in any income under the head' Capital Gains' or the head' Profits and Gains of Business and Profession', then the income tax return should be filed before the due date provided under Section 139(1) of the Income Tax Act.

    • For losses under "House or residential property," the loss can be carried forward even though the return is filed after the due date.

    • Offsetting losses against gains in another category in the same year is permitted even if the returns are filed after the due date.

    Below are the heads that will not be affected by delayed income tax return filing:

    • Any loss that is occurred by the unabsorbed property as mentioned in Section 139(3).

    • Any loss incurred in the heads of 'House and Residential Property.'

  3. Section 139 (4) - Income Tax Return Late Filing:

    This section deals with late income tax return filing. In order to understand the provisions of late filing, let us first learn about the general due dates that have been prescribed for individuals or entities to file their income tax returns.

    31st July: All persons who are not needed to perform an audit on their books of accounts have to file their income tax returns by 31st July of every assessment year.

    30th September: All persons who are liable to perform an audit on their books of accounts have to file their income tax returns by 30th September of every assessment year.

    The provisions of Section 139(4) are described below:

    • The taxpayers are eligible to file Income Tax Guide returns at later stages within 1 year from the completion of the assessment year according to section 144.

    • The taxpayers who are filing an income tax return late may have to pay a penalty of Rs. 5,000, as mentioned under Section 271F of the Income Tax Act, 1961. However, there will be no penalty on returns that were not needed to be mandatorily filed according to Section 139(1) of the Income Tax Act.

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  4. Section 139 (5) - Revised Return:

    This section deals with the revised income tax returns in the situation of any mistakes made while filing the initial income tax returns. The provisions of this section are:

    • If the initial or original income tax returns are filed by the assessee or an entity according to Section 139(1) of the Income Tax Act, then they are eligible to file a revised tax return within 1 year following the relent assessment year's termination or before the conclusion or completion of the assessment, whichever takes place first.

    • Any late tax return is not eligible for revision. But, any loss of return which was filed under the mentioned due date as prescribed in Section 139(1) can be easily revised.

  5. Section 139 (4a) - Income Tax Return of Religious and Charitable Trust:

    An individual whose income is received from the property that is occupied by a religious trust or a public charity and claims exemptions of tax under section 11 and 12 of the Income Tax Act are needed to file income tax returns, provided that the collected sum of income before the provisions as per section 11 and section 12 is beyond the basic allowed limit for the income tax exemption.

  6. Section 139 (4b) - Political Party's Return of Income:

    A political party is needed to file the income tax return, but the total income sum collected by that political party is beyond the basic allowed limit for exemption without taking any benefit mentioned under section 13A into consideration.

  7. Section 139(4C) and 139(4D) - Claiming Income Tax Exemption under Section 10:

    Section 139(4C) and 139(4D) deal with some specific institutions that claim privileges under the provision of Section 10. According to these sections, any institution is mandatorily needed to file its tax returns provided that the sum of income gained by the institution in question is more than the basic allowed exemption limit without considering any other benefits of exemptions.

  8. Section 139(9) - Defective Returns:

    According to the provisions of Section 139 (9), an income tax return is considered defective when some specific documents are not attached or provided with the income tax return. If an income tax officer considers any tax return defective, they inform the concerned taxpayer, and the taxpayer is required to rectify all the defects within 15 days starting from the intimation day. However, this allowed period could be extended by a written request from the taxpayer. Then, the defect is intimated to the taxpayer via a simple letter.

  9. ITR 7 Form: 

    The income tax department has made Form ITR 7 for institutions, entities, or individuals who want to file an income tax return under Section 139 (4a), Section 139 (4b), Section 139 (4c), and Section 139 (4d). The taxpayers are requested to match their tax value as collected, deducted, or paid amounts with Form 26AS. This form can be filed with the Income Tax department in any of the following manners:

    • Electronic filing with the use of a digital signature

    • Filing a paper form

    • Furnishing income tax return which is bar-coded

    • Electronic transmission of data followed by submission of verification return in Form ITR - V.

FAQ's

  • What is a return filed under section 139 of the Income Tax Act?

    Section 139 of the Income Tax Act mentions the different options of returns a person or entity can file if they have failed to file tax returns before the expiry of the deadline.
  • How do I respond to an income tax notice under Section 139 (9)?

    Upon receiving a defective notice under Section 139 (9), you can submit your response on the e-filing portal. Under Response to Notice u/s 139(9), you need to select whether you agree with the defect and mention remarks in case you disagree. Then submit the same online.
  • What is the penalty if income tax returns are filed after the prescribed due date?

    If the income tax returns are filed after the expiration of the due date, the assessee may have to pay a penalty of Rs. 5,000, as mentioned under Section 271F of the Income Tax Act, 1961. However, if the assessee is not liable to pay any tax, no interest will be charged for the late filing of tax returns.
  • What are the due dates for filing returns under section 139(1) of the income tax act?

    As per Section 139(1) of the Income Tax Act, following are the due dates for filing tax returns:
    31st July: All persons who are not needed to perform an audit on their books of accounts have to file their income tax returns by 31st July of every assessment year.
    30th September: All persons who are liable to perform an audit on their books of accounts have to file their income tax returns by 30th September of every assessment year.
  • Does a company which was not operational during the financial year have to file income tax returns?

    If a company is not operating during the financial year, it may have the option to decide if an income tax return must be filed.
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