18.

CHAPTER XIy - FLING OF RETURN OF INCOME

CHAPTER OUTLINE
SI. No. Sec. Reference
Synopsis 139
Filing of return of income
Permanent Account Number (PAN) 139A
Quoting of Aadhaar Number 139AA
139B
4. Tax Return Preparer
. 139C
FowerofBoard todispensewith certain documents from
filing 139D
6. Filing of return in electronic form
7. 140
Return by whom to be verified

1. Filing of Return of Income (RO) -Sec. 139

Revised returns
139(1) Due Dates for filing of
139(4A) Return by Trusts 139(5)
ROI
Return forms
139(1A) Filing of returns by
139(4B) Return by political Parties 139(6)
Employers
139(1B) Persons who shall file 139(4C) Return by certain
returns in electronic associations/ institutions Prescribed
139(6A) Particulars
form
139(1C) Power to exempt from 139(4D) Return by approved research|
filing of return_ institutions
Defective returns
139(3) Loss returns 139(4E) Return by Business Trust 139(9)
139(4) Belated returns 139(4F) Return by Investment Fund

Submission ofreturn of Income-Sec. 139(1D

According tosec.139(1) aperson shallfurnish thereturn of income subject tothe following conditions:
S. Nature of person Condition subject to which R0I to be filed
No.

0) acompany orfirm irrespectiveof their amount ofincome or loss

(i) a local authority_ iftheincome exceeds maximumamountwhich isnotchargeabletoincometax
(iii) any person, other than if his toal income or the total income of any other person in respect of
i)&(ii) above, namely, which he is assessable to tax (say, clubbing of income) during the previous
Individual, HUF, AOP, Bo1, year exceeded the maximum amountwhich is not chargeable to income tax
Artificial juridical person before giving effect to:
(a) any exemption under section 54,54B,54D,54EC,54F,54G,54GA,54GB in
respect of capital gains;
(b) any deductionunder Chapter VI-A(Sec.80Cto80U)
Additional points
1.As the company/firm are required to furnish return of income mandatorily, irrespective of their income or
income etc. or after formation,
loss, even if they derive only exempt income, say, agricultural
not commenced
are also required to comply with filing of return.
business, defunct companies/firm etc.
2.The term 'any person' used in point (iu) above is to be considered as residuary clause to include all the
Dersonfs) not covered in () & (i). Besides, in certain cases, an assessee, apart from filing his own return, is under
or another person(s) for whom he is assessable.
returns for the income
an obligation to furnish shall be liled by the legal heirs of such demised person, Similarku
For e.g. return of income of a demised person
income of a minor child, whose income is assessaDie in thelr nands itself, namely, income derived from ckill
582 Direct Tax Laws
talent, child suffering from disability etc. shall be furnished by parent/guardian etc. Also return of income of a

non-resident assessee shall be furnished by his agent, under certain circumstances.

Mandatory filing of Return of Incomein certain cases
n the rollowing cases, return of income shall be furnished mandatorily irrespective of their income:

I. Persons holding assets outside India

Any person (an individual or HUF), being a resident and ordinarily resident in India within the meaning of
section 6{6), who is not required to furnish a return under section 139(1) and who at any time during the

previous year:
(a) holds, as a beneficial owner or otherwise, any asset (including any financial interest in any entity) located
Outside India or has signing authority in any account located outside India; or
(6) is a beneficiary of any asset (including any financial interest in any entity) located outside India,
shall furnish, on or before the due date, a return in respect of his income or loss for the previous year in such
form and verified in such manner and setting forth such other particulars as may be prescribed.
However, in case of an individual, being a beneficiary of any asset (including any financial interest in any entity)
located outside India, the return of income shall not be necessary in a case where, income, if any, arising from

such assetisincludiblein theincome ofthe beneficial owner.

(a) Beneficial owner in respect ofan asset means an individual who has provided, directly or indirectly
consideration for the asset for the immediate or future benefit, direct or indirect, of himself or any other
person Explanation 4 to sec.139(1).
b) Beneficiary in respect of an asset means an individual who derives benefit from the asset during the
previous year and the consideration for such asset has been provided by any person other than such
beneficiary Explanation 5 tosec.139(1).
II. Persons who fulfill certain conditions
Any person, other than a company or a firm, who is not required to furnish a return under section 139(1), is
required to file income-tax return if, during the previous year, such person
a) has deposited an amount or aggregate of the amounts exceeding Rs. 1 crore in one or more current
accounts maintained with a banking company or a co-operative bank; or
(b) has incurred expenditure of an amount or aggregate of the amounts exceeding Rs. 2 lakhs for himself or
any other person for travel to a foreign country; or
C)has incurred expenditure of an amount or aggregate of the amounts exceeding Rs.1 lakh towards
consumption of electricity; or
(d) fulfils such other prescribed conditions.

Due dates for filing return ofIncome

Areturn ofincomeshall befurnished withinthe due dates stipulated hereunder
Assessee Due date
Any assessee, including the partners of the firm or the spouse of such
1.
partner ifthe provisions ofsec.54 applies to such spouse), who is required 30 November of
to furnish transfer pricing report pertaining to international specified relevant
or
assessment year.
domestic transactions.
i) any company (other than a case referred to in point 1 above):
ii) any other person, other than company, whose accounts are required
to be audited under this Act or under any other Law; and
2. ii) Any partner of a firm, whose accounts are required to be audited 31st October of relevant
under this Act or any other law or the spouse of such partner (if the assessment year.
provisions of sec.5A applies to such spouse); Such partner may be a
working or non-workingpartner
3. In the case of any other assessee. 31st July
assessment year
of relevant
 583
Filing ofReturn ofIncome
Additional points
1. The Cerntral Government is empowered to exempt any class or classes of persons from the requirement
furnishing a return of income having regard to such conditions as may be specified by way of notification in tne

official gazette-Sec. -139(1C).

2. An assessee may furnish return of income on or before 31st October, if he is subject to audit under secti

44AB or under any other section which warrants audit namely, sections 10AA, 12A,35D, 80JJAA, etc
3. Where the accounts of the firm are required to be audited under the Income tax or any other Act, the due aate
for furnishing its return shall be on or before 31st October of the assessment year. Same way. the due date or
furnishing return of income of partner of such firm also shall be on or before 31 October. Same due date sha
apply to both working as well non-working partner.
4. If the firm is not subject to any audit, the due date for the firm as well as for all its partners, working or non-

working, shall be 31 July of the assessment year. in case such partner in his individual capacity carry o
business /profession and the turnover exceeds the limits preseribed u/s. 44AB, the due date for filing return o

income of such partner shall be 31sOctober.

5. Tt may be noted that any default in filing of return of income on or before the time limit prescribed

u/s. 139(1), shall warant levy of interest, fee, penalty, apart from launching prosecution proceeaings.

Filing of bulk return of income of salaried employees by employer Sec. 139(1A)

n case OI Saldriea Class assessees, the return of income for any previous year may, at the option of the empioyee
received by him on
be furnished to the employer concerned. Such employer shall furnish all returns of income
or before the due date (in such form and manner as notified by the CBDT such as floppy diskette, magnetic
who has filed a
cartridge tape, CD-ROM or any other computer readable media) for this purpose. Any employee
return of income to his employer shall be deemed to have fileda return of income u/s. 139[1).

Furnishing ofIncome Tax Return through computer readable Media-Sec. 139(1B)

enables an assessee to file return of

In order to achieve voluminous paperless filing of returns, Sec. 139(1B)
Tax department. It provides an option to a
income in a computer readable format without any interface with the
to furnish the return in a computer readable format (in
the
person, corporate and non-corporate, required
as floppy diskette, magnetic cartridge tape,
CD-ROM or any other
manner as specified by the CBDT such

computer readable media) including online filing.

readable
() Subject to satisfaction of certain conditions, in some cases, furnishing of return through computer
other assesses, who are subjected to audit
media has been made mandatory. For e.g, all company assessee, any
Individual and HUF, whose total income exceeds the specified sum and
u/s. 44AB of the Income-tax Act, every the return only by way of
no refunds are claimed in the
return for the relevant previous year etc. shall furnish

Computer readable form.

it is optional for an assessee to file return in electronic form or
(i) In respect of cases not specifically covered,
in paper form.
such computer readable form shall bedeemed to be a return filed u/s.
139(1).
(ii) Returns filed in
Power to exempt from filing return of income Sec. 139(1C)

to exempt any class or classes of persons from the requirement of

The Central Government is empowered
to such conditions as may be specified by way of notification in the
furnishing a return of income having regard
official gazette.
584 Direct Tax Laws
Class of persons of retum of income
class of persons, subject to conditions specified, shall be exempt from filing
The following
u/s. 139(1):
() Non-residents;
(i) a foreign company, set up
who have any income chargeable during a previous-year
from any investment in an investment fund
shall apply only where:
in an International Financial Services Centre (IFSC) located
in India. This exemption
remitted to the Central Government by the
deducted at source and
(a) any income-tax due has been
investment fund at the tax-rate in force provisions of section 194LBB; and
as per
for which the said class of persons, is otherwise
(b) there is no other income during the previous year
liable to file the tax-return.
a notice u/s. 142(1) or u/s.
148 or u/s. 153A or u/s. 153C
The above exemption shall not be available where therein Notitication no.
has been issued for filing
a return income for the assessment year specified
of
55/2019 dt.26.07.2019.
Loss return - Sec. 139(3)

carried forward
and claims that such loss should be
Any person who has sustained loss in any previous year
under:

) Sec. 72-Business loss;

ii) Sec. 73-Speculation loss;
(ii) Sec.73A-Loss from specified business;
Sec. 74-Loss under the head '"Capital Gains'; or
(iv)
(v) Sec. 74A- Loss from the activity of owning and maintaining race horses,
filed shall be treated as
shall mandatorily file a return of loss within the time allowed u/s.139(1). Any return so

a return filed u/s.139(1) and all the provisions of the Act shall apply accordingly.
Additional points
and loss is determined
() Sec. 80 states that unless loss return is filed within the due date stipulated u/s. 139(1)
this condition does not apply to
in pursuance of that return, such loss cannot be carried forward. However,
71B CIT vs.
and loss under the head "Income from House Property" u/s.
-

unabsorbed depreciation u/s. 32(2)

Govinda Nagar Sugar Ltd (2011) 334 ITR 13 (Del).
head set-off of losses during the year.
ii)Sec. 139(3) read with Sec. 80 does not prohibit inter source or inter
The mandatory filing of return of income shall be fulfilled only for carry forward of losses, if any.

of Sec. 80 to file the return of income on or before the due date prescribed
ii)The requirements
is applicable only for the carry forward of the loss suffered in that particular assessment year.

It does not impact the status of carry forward of loss, if any, of the previous years.
interest and the non-receipt of a notice from the
(iv) A return of loss has to be filed by the assessee in his own
AO requiring him to file the return cannot be valid excuse under any circumstances for the non-filing of such

term.
Incase of belated filing of loss return, the assessee may seek remedy by making an application to the Central

Board of Direct Taxes for relaxation oftimetocarryforwardthelossforsetoff-CircularNo. 9dt.09.06.2015.

Belated return Sec. 139(4

Anyperson who hasnot furnisheda return on orbeforethe time allowed u/s.139(1) can stillfle abelated
return.
Belated return u/s.139 (4) can be filed any time:
Before 3 months from the end ofthe relevant assessmentyear (in other words 9 months from the end of the
i)
financial year); or
ii) Before the completion of assessment,
whichever is earlier.
 585
To illustrate, Mr. A, who earns only
Eiling of Return of Income
salary for the PY 2021-22 (AY 2022-23) ought to nave he urr of
income before 31.07.2022,
on or
being the time limit permitted u/s. 139(1). In case has not tiled the
if he reut"
or Detore 07.2022, he may file a belated return on or before 31.12.2022, which is 3 months before the end of
the relevant assessment year. In case his assessment is completed by the assessing officer, say by 18.lL.z044,
u
corresponding time limit for furnishing belated return u/s. 139(4) also concludes by 18.12.2022.
Additional points
1)t any person tals to furnish return of income, the Assessing officer shall, after taking no unt all
relevant material which he has
gathered, make the assessment of total income to the best of his juage Th
is known as best judgment u/s. 144.
Completion of assessment as referred to in Sec. 139(4) rerers o Des
judgment assessment.
() In case a person files belated return u/s. 139(4), he shall not be entitled to deductions as prescribed under
sections 80-IA to 80RRB- Sec. 80AC.
(i) Any return of income filed beyond the time limit prescribed u/s. 139(4) is an invalid return. Any
assessmenton thebasis of such invalid return is void - Maya Debi Bansal vs. CIT (1979) 117 ITR 125 (Cal).

Returns by Trusts-Sec. 139(4A)

Every persOn in receipt of income derived from property held under trust or other legal obligation wholy or
partly tor charitable or religious purposes or income by way of voluntary contributions, shall furnish a return or
the total income it it exceeds the maximum amount which is not chargeable to tax i.e., Rs. 2,50,000, betore giving
etfect to the provisions of sections 11 and 12. Where the income of the trust, before giving effect to sections 1
and 12, exceeds the maximum amount not chargeable to tax, audit of accounts of the trust is compulsory u/S.
12ALJDJ. Therefore, the due date for filing return of income of the trust would be 31s0ctober of the relevant

assessmentyear.
Charitable institutions who have not filed return of income in accordance with Sec.139(4A) are not entitled to
the benefit of accumulation of income- Sec. 13(9). Accordingly, returns filed belatedly are not entitled to the
benefit of accumulation of income. Further, penalty u/s. 272A(2) amounting to Rs. 100 shall be levied for

everyday during which failure to file return continues.

Returns by political parties-Sec. 139(4B)

The Chief Executive Officer of every political party shall furnish a return of income in respect of which the
political party is assessable if it exceeds the maximum amount which is not chargeable to tax i.e. Rs. 2,50,000
before giving effect to the provisions of Sec. 13A. The due date for filing the return of income is 31st October of
the relevant assessment year.
Further, in order to avail exemption u/s. 13A, the accounts of a political party must be audited. Also, exemption
shall be allowed only if return of income is filed as per the time line prescribed u/s. 139(1)- Third Proviso to
sec. 13A.

Returns by certain associations/institutions Sec.139(4C)

The following entities shall furnish their return of income in accordance with the Sec. 139(1) where the total
income before giving effect to exemption u/s. 10, exceeds the maximum amount not chargeable to tax ie. Rs.
2,50,000:
(a) Research association covered u/s. 10(21);
(b) News agency covered u/s. 10(22B);
(c) Association or Institution referred to in Sec. 10(23A)/(23B);
(d) Person on behalf of Funds specified u/s. 10(23AAA);
(e) Fund or Institution, University or other educational institution or hospital or other medical institution
referred to u/s. 10(23C)(iiab); (iliac:(iiad); (iiae); (iv); (v); (vi); (via) - .Refer Chapter titled Taxation of

trusts];
(Mutual Fund covered u/s. 10(23D);
8Securitisation trust covered u/s. 10(23DA);
586 Direct Tax Laws
capital
venture fund referred to in sec. 10(23FB);
h) Venture capital company or
(i) Trade union or association
covered u/s. 10(24);
Board Trust or Commission as
referred u/s. 10(46);
0) Body or Authority or or

(k) Infrastructure debt fund covered u/s. 10(47);

()Investorprotection fund covered u/s. 10(23EC)/ (23ED);and
m) Core Settlement Guarantee Fund covered u/s. 10(23EE);
(n) Board or Authority covered u/s. 10(29A).
liable to file
exempt from tax. However, they
are
total income of the above institutions or associations is
The the conditions upon which such
return of income in order to enable the Assessing Officer to examine whether
institution or association granted approval are satisfied

Trust or Investment Fund

Return by associations/institutions approved u/s. 35 or Business
Sec. 139(4D), Sec. 139(4E) and Sec. 139(4F)
associations
(a) Every university, college or other institutions approved u/s. 35(1)(ii) or 35(1)(ii) (Research
with the object ofscientificresearch, social science or statistical research) Sec. 139(4D) or;

(b) Every Business trust Sec. 139(4E); and

-

Sec. 139(4F),
(c) Every Investment fund referred to in sec. 115UB-
Which are not required to furnish the of its income or loss under any other provisions of this section,
return
Act shall apply as if such return is
shall furnish the same in every previous year and all the provisions of this
required to be furnished u/s. 139(1).

Revised return-Sec. 139(5)

file
return u/s.139(1); or (b) belated return u/s.139(4) may
a
) Any person, who has furnished:(a) original
statement in the return filed earlier.
revised return if the assessee discovers any omission or any wrong
time:
(ii) Such revised return may be furnished at any
assessment year (i.e.,31st December
of relevant AY); or
(a) before 3 months from the end of the relevant
(b) before completion of assessment,
whichever is earlier.
if it is within the time limit prescribed u/s.139(5).
(i)A revised return filed earlier can be again revised,
of assessment is the return ultimately filed by the
assessee.

(iv) The effective return for the purposes of times within the
a return may be revised any number
A revised return replaces the original return. Therefore,
time limit u/s. 139(5).
Case Law
bonafide
in the original return is not on account of a
(a) Where any omission or wrong statements
return revised u/s. 139(5) shall not be a valid
revised
inadvertence or mistake on the part of the assessee,
return Sunanda Ram Deka vs. CIT (1994) 210 ITR 988 (Gau).
-

bearing assessment, a subsequent return correcting

wrong statement has
a on
(b) Unless the omission or a
constitute valid revised return u/s. 139(5) -

Hamila Fancy stores

wrong statement shall not
a
such omission or

vs. CIT (1976) 104 ITR 190 (Mad).

the could file a revised
Where intimation was issued and no assessment was made u/s. 143(3), assessee

(c) an
pursuant made to such
expiry of the time allowed and the
assessment
return u/s. 139(5) at any time before the
ITR 523 (MP).
return would be a valid
assessment-
CIT vs. Omprakash Bagria (HUF) [2006] 287
due date u/s. 139(3). Later he revises the return u/s. 139(5) and
(d) Assessee files a loss return within the
of
of revised loss return is valid and sec. 80 does not come in the way
claims enhanced amount of loss. The filing return
such increased amount of loss. The revised return replaces the original
disallowing the carry forward of
District Co-operative Milk Producers Union Ltd. (2004) 266
which was filed within the due date CIT vs. Periyar
ITR 705 (Mad).
 587
Eilingof Return of Income
e se where a returm of income [u/s. 139(1) or u/s. 139(4]] has been filed in accordance with thetime limit
ne oyopon avalable to the assessee to make amendmentto such return is by way of fling a return u/s. 139(5)
Where an assessee, files a letter or application seeking the Assessing Officer to allow certain deduction, c
Officer shall not allow the same Goetze
(India) Ltd.
-

vs. CIT (2006) 284 ITR 323 (SU).

e a provIdes for acceptance of revised return filed within the time u/s. 139(5). A return filed beyond the
time limit shall be considered to be invalid. However, where a revised return was furnished pursuant to scnene

amalgamation
by the NCLT and the scheme provides for filing of revised return byPower
approvedof the the
amalgamated
ACIT
companyon approval scheme, the same shall be considered as valid under law Dalmia Ltd. vs

[2020]4201TR 339(SC).
The provisions of Sec. 139(4) belated return and Sec. 139(5) - revised return as discussed above Snd
equallyapply to Sec.139(4A),(4B), (4C). (4D), (4E) and (4F)
Particulars required to be furnished with the return Sec. 1396)
The assesse shall furnish the following particulars in the prescribed form of return wherever required:
i) Details of exempt income;
1) Nature and value of prescribed assets held by him as a beneficial owner or otherwise or in which he is a

beneficiary;
ii) Details of bank account and credit card;
iv) Details of expenditure exceeding the prescribed limits under prescribed heads; and
vSuch other outgoings as may be prescribed.
Particulars to be furnished in the case of an assessee engaged in business or profession-Sec. 139[6A)
The assessee engaged in business or profession shall furnish the following particulars in the prescribed form of
the return wherever required:
i) Audit report u/s.44AB;
i) Particulars of location and style of the principal place of business or profession and all the branches;
i) The extent of the share of the assessee; and
iv) The names, addresses and the extent of shares of his partners of the firm or other members of the AOP or
BOI, as the case may be.

Annexure less return ofincomne

1. Presently, there are 7 different Income-tax Returns (Form No. ITR-1 to Form No. ITR-7) applicable for
different classes of assessees. Subject to fulfilment of conditions prescribed thereunder, appropriate ITR shall
be used for furnishing return. All these returns are electronically enabled and thus, be filed online, unless
otherwise physical filing is allowed. In view of the online filing, the return of income shall not be
accompanied by any annexure, including that of statement showing the computation of total income, tax
payable, proof of payment of advance tax, self-assessment tax challans, certificate for TDS/TCS credits availed,
copy of any audit report etc. Rule 12(2) provides for such annexure less return.
2. It may be noted that in respect of certain cases, audit reports shall be furnished by the assessee,
electronically. Some of the audit reports specifically included for electronic furnishing along with return of
income are reports like 44AB, 10AA,80|JAA etc.
Defective return -Sec. 139(9)
i)Where the Assessing Officer considers the return of income furnished by assessee as defective, he may
intimate the defect in the return of income to the assessee. Such defect could be in the form of non-furnishing of
certain information or documents along with the return of income, namely, profit & loss account, TDS/TCs
certificates, audit report etc.
i)The assessee may be called upon to rectify such defect within 15 days from the date of intimation or within
such extended time allowed on application made by the assessee.
ii)If the defect is not so rectified then the A0 shall treat the return of income as an invalid return and proceed as
if the assessee has failed to furnish the return. However, if the assessee rectifies the defect after the time
 Direct TaxLaws treat the return as
588 condone the delay and
empowered to
is made, the A0 is
allowed but before the
assessment

above conditions shall

valid. notification that any of the
CBDT has been empowered
to specify by notification.
regard, the specified in such
such modifications as may be less and in electronic mode.
In this
assesseeorshall apply with
notapply for a class of the returns are required
to be filed
annexure

assessee, In
discussed above, presently all shall be furnished by the
As by the income-tax authority
Documents, if any, as and when sought income shall not be considered to
a return of
statements, if any,
view of this, for non-inclusion of documents,
be a defective return.

Documentsfrom Filing-Sec.139C
Power of Board to Dispense Certain class or classes of persons who
empowered to make rules to provide for a
The Central Board of Direct Taxes is
certificates, audit report or any other
may not be required to furnish documents, statements, receipts,
to Sec. 139D under which the
required under the Act. This provision subject
is
documents which are otherwise
such documents
furnish such documents. However,
Central Board of Direct Taxes may require an assessee to
should be furnished on demand to the Assessing Officer
Filing of Return in ElectronicForm -Sec. 139D
for-
Section 139D empowers the CBDT to make rules providing form.
to furnish the return of income in electronic
a) The class or classes of persons who shall be required
income in electronic form may be furnished;
b) The form and the manner in which the return of not be furnished along
with
certificates or reports of audit which may
c) The documents, statements, receipts,
the return in electronic form but shall be produced before
the Assessing Officer on demand;
to which the return in electronic
form may be transmitted.
d) The computer resource or the electronic record as required
Return of Income Scheme, 2007
CBDT has accordingly notified Electronic Furnishing of
in electronic form and who can be
u/s. 139(1B)and u/s. 139D. The class of persons who shall file returns
e-Return intermediaries have been detailed u/s. 139(1B).
Permanent Account Number Sec.139A
character being issued by thedepartment in
tax
Permanent Account Number (PAN) is a 10-digit alphanumeric
in all tax challans, returns and correspondences with the
the form of a laminated card. PAN should be quoted
Income tax authorities.
I. Applying and allotment of PAN
Thefollowing persons shall apply for PAN within the time limit as mentioned below:
Situations Time limit for applyingPAN
On or before the 31s May of the
() Any person whose total income assessable to tax during any previous relevant assessment year in which
to tax either in
year exceeded the maximum amount not chargeable
such income is assessable.
respect ofhisincome ortheincome of any other person
relevant
ii) Any person carrying on business/profession whose turnover or | Before the end of the
gross receipts are likely to exceed Rs. 5,00,000 any previous year
in previous year
(ii) Any trust which is required to furnish a return of income u/s. | Before the end of the relevant
139(4A). previous year
(iv) Any person being a resident, other than an individual, which enters On or before the 31st day of May
into a financial transaction of an amount aggregating to Rs.2,50,000 or immediately following such
more in a financial year. financial year
(v) Any person who is the managing director, director, partner, trustee, On or before the 31st day of May
author, founder, Karta, chief executive partner, principal officer or office immediately following the
bearer of the person referred to in (iv) or any person competent to act financial year
on his behalf.
Note: The AO on his own motion may allot PAN to any person, having regard to the nature of transaction,
whether or not tax is payable by such person.
 589
EilingofReturnofIncome
I. Mandatory quoting of PAN
PAN so allotted shall be quoted: (i) in certain
() PAN to be quoted in certain cases:
cases; and (ii) for specified transacuon
According to sec.139A(S), on allotment of PAN, every person shall quote such
in all his returns to, or
number
a.
correspondence with, any income tax authority;
b. in all challans for the
payment of any sum due under this Act;
C i n all documents pertaining to such transactions as may be preseribed by the CBDT in the interest or t e

Revenue and entered in to by such person.

() PAN to be quoted mandatorily for specified transactions:
According to sec.139A(5)(c) and Rule 114B, every person shall quote his PAN in all documents relating to e

following specified transactions:

A) Purchase or sale of Assets
)Securities
SI.No. Nature of transaction Value of transaction
-

Any contract for sale or purchase of securities (other Amount exceeding Rs. 1,00,000 per
1.
than
shares) transaction.
Amount exceeding Rs. 1,00,000 per
2. Sale or purchase of unlisted shares
transaction.
3. Payment to Mutual Fund for Amount exceeding Rs. 50,000.
a
purchase of its units.
Payment to a company or an institution for acquiring Amount exceeding Rs. 50,000.
4.
debentures or bonds issued byit.
Payment to the Reserve Bank of India for acquiring Amount exceeding Rs. 50,000.
5.
bonds issued by it.(Not mandatoryfor NR)
Other assets
SI.No. Nature of transaction Vaiue of transaction
Amount exceeding Rs. 10,00,000 or
valued by stamp valuation authority
6. Sale or purchase of any immovable property. referred to in Sec. 50C of the Act at an

amount exceeding Rs.10,00,000.

Sale or purchase of a motor vehicle or vehicle, as
defined in the Motor Vehicles Act, 1988 which requires
7. All such transactions.
registration by a registering authority, other than two
wheeled vehicles.
B) Transactions with Banks/Co-operative bank/Post Office
=

SI.No. Nature of transaction Value oftransaction

an account (other than a time deposit and a
Opening
Basic Savings account) with a banking company or co- All such transactions.
8.
operative bank
Making an application to any banking company or a co-
operative bank or to any other company or any
9. institution for issue of a credit card or debit card. (not
All such transactions.
mandatory for NR)
Opening of a demat account with a depository,
custodian of securities or any other person | All such transactions.
10. participant,
registered with SEBI.
Deposit with a banking company or banking institution| Deposits
in cash exceeding
11.
or a co-operative bank or post office.
Rs. 50,000 during any one day.
590
Direct Tax Laws
Purchase of bank drafts pay orders
12.
or or
banker s cneques Payment in cash for an amount
from a
banking company or
exceeding Rs. 50,000 during any one day.
cO-Operative
A
bank.(not mandatoryfor NR) exceeding Rs. 50,000
Time deposit with a banking company or a co
Amount or
13. perative bank, or a post office, or a Nidhi as per aggregating to more than Rs. 5,00,00o

Companies Act, 2013 or an NBFC. during afinancial year

Payment for one or more pre-paid payment Payment in cash or by way of a bank draft
instruments, as defined by Reserve Bank of India under or pay order or banker's cheque of an
14. Payment and Settlement Systems Act, 2007, to a amount aggregating to more than Rs.
banking company or a co-operative bank, or to any 50,000 in a financial year.

othercompany orinstitution.(notmandatory for NR)

Note: (1) Banking company or a co-operative bank means a banking company or a co-operative bank to which
the Banking Regulation Act, 1949 (10 of 1949), applies (including any bank or banking institution referred to in
section 51 of that Act).
(2) "Time deposit' means any deposit which is repayable on the expiry of a fixed period.
3) Any person, not falling or carrying circumstances specified above, may also apply to the Assessing Officer for
the allotment of a permanent account number and, thereupon, the Assessing Officer shall allot a permanent
account number to such person.
(4) The Central Government may notify any class or classes of persons including
importers and exporters, who
is liable to pay tax
or not either in the Income tax Act or under any other law or for the
purpose of collection of
information, direct such persons to apply to the Assessing Officer for the allotment of PAN within the
prescribed
time.
C) Other Transactions
=

SI.No. Nature of transaction Value of transaction

15. Payment to a hotel or restaurant against a bill or bills at
| Payment in cash of an amount
any one time. (not mandatory for NR) exceeding
Rs. 50,000.
Payment in connection with travel to any foreign
foreign Payment
16. country in cash of amount
or payment for purchase of any an
exceeding
currency at any one time. (not mandatory for NR) Rs. 50,000.

17. Payment as life insurance premium to an insurer Amount aggregating to more than
Rs. 50,000 in a financial year.
Notes:(1)'Payment in connection with
travel' includes
payment towards fare, or to a travel agent or a tour
operator, or to an authorized person as defined in section
2(c) of the FEMA, 1999.
ii) Travel agent or tour operator' includes a
person who makes arrangements for air, surface or
travel or provides services maritime
relating accommodation, tours, entertainment, passport, visa,
to
travel related insurance or other travel related services either foreign exchange,
=
severally or in package.
D) Sale or purchase of goods or services of any nature other than
those specified above for an amount
Rs. 2,00,000 per transaction.
(not mandatory for NR) exceeding
Exemptions from quoting PAN for transactions specified above
In the of
case
following class or classes of persons, quoting of PAN is
above:
not
required for the transactions
specified
(1) In the case of a minor entering into any transaction referred to
above and who does not have
chargeable to Income tax, he shall quote the Permanent Account Number any income
the case may be. of his father or mother or
guardian, as
(2) Payers being Central, State Governments and Consular
Offices.
 591
Eiling ofReturn ofIncome ed
number and who enters
into any transdcuo pe
3) Any person who does not have a permanent account
above, he shall make a declaration in Form No. 60 giving therein the particulars ofsuch transaction
estilmaeu
declaration that the
tax on his oa
Persons who does not have taxable income and furnishes a
4
income for that previous year is nil. a
non-resident, or locg
Further, Rule 114AAB provides that Sec. 139A shall not apply to a non-corporate
(5) to the
made investment in a specified fund subject rouOw
company, who has, during a previous year,
conditions:
in ne
investment
non-resident does not earn any income in India, other than
the income from
1. tne

specified fund during the previous year;

remitted to the Central
at source and
. any income-tax due onincome of non-resident has been deducted
of the Act; and
Government by the specified fund at the rates specified in section 194LBB
fund:-
documents to the specified
ifi. the non-resident furnishes the following details and
(a) name, e-mail id, contact number;
resident;
India of which he is a
b) address in the country or specified territory outside
and
territory outside India;
(C) a declaration that he is a resident of a country or specified
and in case no
a Tax ldentification Number in the country or specified
territory of his residence
is identified
number is available, then a unique number on the basis
of which the non-resident
Sucn of which he claims to be a
resident
Dy the Government of that country or the specified territory
Notification No. 58/2020, dated 10.8.2020.
a
of a trust or a company or
Specified Fund" means any fund established or incorporated in India in the form a
as
a certificate of registration
mited lability partnership corporate which has been granted
or a body Board
under the Securities and Exchange
Category or Category II Alternative Investment Fund and is regulated
of India (Alternative Investment Funds) Regulations, 2012, and which is
located in any International Financial
of the financial year, in
Services Centre. The specified fund has to furnish a quarterly statement for the quarter
which the details and documents furnished by such non-resident are received by
it, in Form No.49BA to the
or the
General of Income-tax (Systems)
Principal Director General of Income-tax (Systems) or the Director
to upload the declaration
received from such non-
person authorized by him, electronically.
It also required
resident within 15 daysfrom the end ofthe quarter of the financial year to which such statement relates.
above specified transactions shall ensure
According to sec.139A(6), every person receiving documents relating to
that the PAN or General Index Number or Aadhar number has been duly quoted in the document

IlI. Intimation of PAN and duties of the person to whom the PAN is intimated
on which tax has been deducted
at
(a) Duties of person any income or sum or the amount
receiving
for deducting tax at source
source (i.e., a payee): Such person shall intimate his PAN to the person responsible
shall intimate his PAN to his
Sec.139A(SA). For example, any employee, who is subject to TDS on salary
employer.
person who has deducted TDS (is. a payer, who has
payer): According to sec.139A(SB), any
(b) Duties of a
to be
deducted tax at source shall quote the PAN of the payee in all the statements, certificates of TDS etc.

furnished to theincometax authorities.

It may be noted that sections 139A(SA) and 139A(5B) shall not apply to a person, whose total income is not
of the Income-tax Act.
chargeable to tax or who is not required to obtain PAN under any provisions
licensee or lessee shall
(c) Obligation for PAN in respect of provisions relating to TCS: Every buyer,
intimate his PAN to the person responsible for collecting such TCS Sec.139A(5C). Again, the person who is
responsible for collecting TCS shall quote the PAN of the buyer etc. in all the certificates furnished to such buyer
etc. and in all the statements of TCS furnished to the income tax authorities.
 592 Direct Tax Laws
transactions: Such person shall quote his PAN or Aadhar
a persson entering into prescribed
(d) Dutyasofthe
number, case may be, in the documents pertaining to transactions prescribed and also carry out

authentication of such PAN or Aadhar number. Sec.139A(6A).

to transactions prescribed: Every person receiving any
person receiving documents relating
(e) Duty ofrelating
documents to the transactions prescribed shall ensure that the PAN or Aadhar number has been duly

authentication of such PAN or Aadhar number.

in such document and also carry out
quoted
Sec. 139A6).
Authentication meansthe process by which the permanent account number or Aadhaar number along with
income-tax authority or
demographic information or biometric information of an individual is submitted to the
Such other authority or agency as may be prescribed for its verification and such authority or agency verifies the

correctness, orthe lack thereof,on thebasis ofinformation available withit.

Additional Points
A n y change in the address or name and nature of business on the basis of which PAN was allotted should be

intimated to the Assessing Officer.

2. Any person who has already been allotted a PAN shall not apply, obtain or possess another PAN. Therefore,
an assessee cannot hold two permanent account numbers.

) Any person failing to comply with provisions of Sec. 139A with reference to permanent account number will
be levied penalty equal to Rs. 10,000- Sec. 272B(1).
(i)Any person failing to quote permanent account number or quoting false permanent account number shall
be levied penalty equal to Rs. 10,000 for such default Sec. 272B(2).

Case law
Banking and financial institutions shall not insist upon such persons to furnish PAN while filing declaration u/s.
197A. However, Sec. 206AA would continue to be applicable to persons whose income is above the maximum
amount not chargeable to income-tax and it may not be necessary for such persons whose income is below the
maximum amount not chargeable to income tax to obtain PAN - Smt A. Kowsalya Bai vs. UOI (2012) 346 ITR 156
(Kar).
3.Quotingof Aadhaar Number- Sec. 139AA
(1) According to Sec. 139AA(1), every person who is eligible to obtain Aadhaar number shall on or after 1st july,
2017 quote Aadhaar number:
i) In the application form for allotment of permanent account number;
i) In the return of income
However, where a person does not possess the Aadhaar Number, the Enrolment ID(28-digit Enrolment
Identification Number) of Aadhaar application form issued to him at the time of enrolment shall be quoted in
the application for permanent account number or, as the case may be, in the return of income furnished by him.
(2) Every person who has been allotted permanent account number, and who is eligible to obtain Aadhaar number,
shall intimate his Aadhaar number to Principal Director General of Income Tax (Systems) or Principal Director of
IncomeTax (Systems) on or before 31sMarch, 2022-sec.139AA(2).
Failure to fulfil the requirements ofsec.139AA(2) explained above, shall warrant a fee (not exceeding Rs.1,000) at
thetime of making such intimation -Sec.234H.
(3) In a case where there is a failure to intimate the Aadhaar number, the permanent account number allotted to
the person shall be made inoperative after the date so notified. It is notifed that the Aadhar number has to be
linked with permanent account number on or before 31t March, 2022. Notwithstanding the last date of
intimating/linking of Aadhaar Number with PAN being 31.3.2022, w.e.f. 01.04.2019, it is mandatory to quote
and link Aadhaar number while filing the return of income, either manually or unless electronically, specifically
exempted-Circular No.6/2019 dated 31.03.2019.
The above requirement shall not apply to those who do not have Aadhaar who do not wish
or to obtain
 Aadnaar ror the time
Filing of Return of Income 593
being. Accordingly, their PAN number shall continue to be valid CBD'T press
dated 10.06.2017. reieas
-

(4) The provisions of quoting Aadhar shall

not apply in the following cases: Notification No.
i) Individuals residing in the States
-

37/201
of Assam,
ii) Non-resident as defined in Jammu and Kashmir and Meghalaya,
ii) Individuals of the age of 80 Sec.2(30);
years or more at any time during the
iv) Not acitizen of previous year
India.
Interchangeability of PAN and Aadhar
According to
sec.139A(SE), every person who is reguired to furnish or intimate or quote his PAN under this
Act, and who:
a has not been allotted a
permanent account number but possesses the Aadhaar number, may
intimate or quote his
Aadhaar number in lieu of the furnish or
allotted a permanent account number in such permanent account number, and such person shall be
be
(b) has been allotted a PAN, and who has intimated hismay prescribed; in
manner as

sec.139AA (2), may furnish or Aadhaar number accordance with provisions of

intimate or quote his Aadhaar number in lieu of the permanent account
number.

4. Tax Return Preparer- Sec. 139B

a) A specified class of persons shall be enabled to seek the services of Tax Return Preparers (TRPs) for the

purpose of preparing and furnishing returns of income.

b n e tax return preparer shall assist the persons furnishing the return in a manner as specified in the scheme,

and shall also affix his signature on such return.

) Any person, other than a company or a person whose accounts are required to be audited u/s. 44AB or
under any other law for the time
being in force, who is required to furnish a return of income under the Income
tax Act canfurnish returns prepared by TRPs.
d) The scheme notified under the said section may provide for the following:
() The manner in which and the period for which the TRP shall be authorized.
1) The educational and other qualifications to be possessed and training and other conditions to be fulfilled.
(ii) The duties, obligations and code of conduct for the TRPs.
iv) The circumstances under which the authorization given to a TRP may be withdrawn.
() Any other matter as specified by the scheme for the purpose of this section.
"Tax Return Preparer" shall be any individual who holds a Bachelor degree from a recognized Indian University
in the fields of business administration or management or commerce or economics or law or mathematics or
statistics or passed intermediate level examination conducted by Institute of Chartered Accountants of India or
Institute of Company Secretaries of India or Institute of Cost Accountants of India. However, TRPs do not
include a chartered accountant, legal practitioner entitled to practice in any civil court in India, an employee of
specified class of persons and an officer of a Scheduled Bank with which the assessee maintains a current
account or has other regular dealings.
Consequences ofnon-filing of return of income

Sec. Non-compliance Consequences

Delay or non-filing of return of | Interest at the rate of 1% per month or part of the month
234A
income shall belevied.
Delay or non-filing of return of Return fled
subiect to feeafter the timeHowever,
of Rs.5,000. prescribed u/s.total
if the 139{1) shalldoes
income be
234F
income
not exceed Rs. 5 Lakhs, the fee shall not exceed Rs.1,000.
Non-filing of return of income by|
certain trust [139(4A)] and by | Penalty of Rs. 100 for every day the failure continues shall
272A(2) certain institutions [139(4C)]| belevied.
within the time-limit
 594 Direct Tax Laws
Prosecutions for non-filing of return ofincome
Prosecution
Section Criteria Consequence
Section Nature of default
Where the tax sought Rigorouss imprisonment
which may extend from
to be evaded exceeds
Willful failure to furnish
return of income u/s. Rs. 25 lakhs 6 months to 7 years and fine.
276CC Imprisonment which may
139(1) 139(1) or u/s. 142(1)) extend from 3 months to
or u/s. 148 or u/s. 153A Any other case
2 years and fine._
is furnished
There will be no prosecution u/s. u/s. 139(1) if: (a) the return
276CC for failure to furnish return
total income
not being a company on the
before the expiry of the AY; or (b) the tax payable by such person
if any, paid before the
or self-assessment tax,
determined on regular assessment, as reduced by the advance tax
expiry of the AY, and any tax deducted or collected at source does not exceed Rs.10,000.

7. Return by Whom to be Verified -Sec. 140

Assessee Verified by
Individual Himself
Himself or any person duly authorized by
him in this behalf holding power of
(i)When the individual is absent from India
attorney of such individual.
1
his
Any person duly authorized by him;
(ii) When he is mentally incapacitated from attending to
guardian or any other person competent
his affairs; for any other reason he is not able to verify. to act on his behalf.
Karta
()HinduUndivided Family
2. ii) Where Karta is absent from lndia or is mentally Any other adult member of the family
incapacitated from attending to his affairs.
Managing Director
(i)Company
By any director thereof or any other
(i) Where for any unavoidable reason MD is not able
to
person as may be prescribed by the
verify the return; or where there is no M.D. CBDT

iii) When company is a non-resident in India Any person who holds a valid Power of
Attorney from the company

Civ)When the company is being wound up (whether

under the orders of a court or otherwise)/ any person has The liquidator
3.
been appointed as the receiver of any assets of the

company.
(V)When the company's management is taken over by the The Principal Officer
Government.

(vi)Where the company has made application for

corporate insolvency resolution process& the same
is Insolvency Professional appointed by
admitted by the Authority under Insolvency Bankruptcy such Adjudicating Authority
Code.

Firm Managing partner

4.
(ii) Where for any unavoidable reason, managing partner Any other partner not being a minor
is not able to verify or there is no managing partner
(i) Limited Liability Partnershipp Designated partne
5. ) Wherefor anyunavoidable reason, designated partner is | Any partner thereof or any other person
as may be prescribed by the CBDT.
not ableto verify orthereis nodesignated partner
 595
Eilingof Return ofIncome
6. Local Authority Principal Officer such
Chief Executive Officer (whether
7. Political party officer is known as
chief executive

secretary or by any other designation)

8. Association of Person Any Member or Principal Officer who is
That person or some other person
9. In the case of any other
person competent to act on his behalf
Note: In case a personis duly authorized by the assessee, he shallattach to the return of income, the row

of Attorney, through which such authorization is granted.

Case Laws
CIT (2001) 250
(a)A return which is not signed and verified is an invalid return Electrical Instrument Co. vs.

ITR 734 (Del).

same is a curabe
bJ Where the return was signed by a wrong person who is not competent to sign, the
original
derect. when the defect/irregularity is cured, the revised return will relate back to the date of filing of origina
where the
return
CIT vs. Haryana Sheet Glass Ltd. (2009) 318 ITR 173 (Del). It was similarly held in a case

defective return
signed by an employee authorized by board resolution the same has to be treated
as
return was
Chairman Managing
u/s. 139(9). However, when the same is cured later by re-filing a return signed by the
cum

Director and the AO accepts the same it cannot be treated as invalid return - Hind Samachar Limited vs. Union of

India (2011) 330 ITR 266 (P&H).

Self-Assessment Tax-Sec. 140A
142 for
On the basis of the return of income that is in response to notice issued u/s.
being filed u/s. 139 or
income has escaped assessment, or
making inquiry before assessment or in response to notice u/s. 148 where
in response to notice u/s. 153A for making assessment in case of search or requisition, the assessee is required

to compute the self-assessment tax payable by him after considering the following:
(a) Tax, already paid under the provisions of the Act;
(b) Amount of tax deducted at source or collected at source;
(c)Reliefclaimed u/s 89;
(d) Relief of tax u/s. 90, 90A or 91;
Credit Alternate
Minimum Alternate Tax (MAT) available in case of company, u/s. 115JAA; on
(e) Credit on
Minimum Tax (AMT) available in case of person other than company, u/s. 115]D;
taxation of ESOP as perquisite in the hands of
( Any tax or interest payable according to sec. 191(2) -

employees of the start-up companies.

of income interest for default in payment of
(u/s. 234A),
Besides, interest payable for delay in filing return
with fee
advance tax (u/s. 234B) or interest for deferment in payment of advance tax (u/s. 234C) along
return of income and the
234F shall be computed and paid together with the tax payable before filing the
u/s.
proof of payment shall be attached thereto.
of the aggregate of the tax, fee and interest, the payment
so
If the payment made by the assessee falls short
made shall be adjusted in the following order:
(a) fee payable u/s. 234F;
and
(b) interest payable u/s. 234A, 234B, 234C;
towards the tax payable.
Cbalance amount shall be adjustted
143 or assessment is made u/s. 144 any other relevant
or u/s. 153A or
After a regular assessment is made u/s.
amount paid under this section shall be deemed to have been paid towards such
provisions of the Act, any
assessment.
140A is remaining unpaid, he shall be deemed to be an assessee in default
Where any tax or interest or fee u/s.
the Income-tax Act shall apply, including
in respect of such amount and accordingly all the provisions of
Lpenalty u/s.221-Sec 140A(3)