Section 139 of the Income Tax Act: Provisions For Filing Different Types Of Returns
Anyone earning an income regardless of the sources is liable to pay income taxes as per the Income Tax Act. Taxpayers bear full responsibility for filing income tax returns (ITR) within due dates; otherwise, they are liable to pay penalty/interest. Section 139 of the Income Tax Act lays provisions for filing different types of returns within prescribed due dates.
The following sections will explain the provisions of Section 139 as well as various sub-sections under it.
About Section 139 of the Income Tax Act
Section 139 stipulates that any company/firm or a person having a total income over the amount not chargeable to income tax has to file ITR for the previous year. It also provides a statutory time limit for filing tax returns. Taxpayers can file returns within the due date or belatedly up to the end of the relevant assessment year or before the assessment.
This Section lays out guidelines for filing different kinds of returns in case you do not file ITR within prescribed deadlines. The following are these tax filing categories under different sub-sections of Section 139 of the Income Tax Act.
Section 139(1) — Voluntary and Mandatory ITR
Filing ITR is mandatory in the following situations:
- A taxpayer has a total taxable income over the exemption limit
- A resident with assets outside of India, regardless of his/her tax liability
- A resident who has signing authority for an account outside the country
- For any company, whether public, private, domestic or foreign
- Taxpayers belonging to the following categories — Hindu Undivided Families (HUF), Body of Individuals (BOI) or Association of Persons (AOP)
In certain situations, individual taxpayers do not have to file a mandatory return. In such cases, you can file voluntary ITRs, which are still valid.
Section 139(3) of the IT Act — Return of Loss
Under this sub-section, if an individual, company or firm incurs losses in the previous financial year, filing ITR will not be mandatory. It also lays guidelines for carrying forward such losses upon filing ITR to reduce your tax liability in the future. Furthermore, Section 139(3) states that:
- For losses under ‘House or residential property, you can carry forward losses after filing late ITR.
- If you get income under ‘Profits and Gains of Business/Profession’ or ‘Capital Gains’, you must file ITR before due dates u/s 139(1).
- If you do not file ITR before due dates, you cannot carry forward losses.
- Even if returns are filed after due dates, you can still offset losses incurred on residential property and unabsorbed expenses.
Section 139(4): Belated ITR
You should file ITR before the due dates prescribed by Sub-section 1 of Section 139 of the Income Tax Act. Otherwise, you must file it within the time provided by a notice u/s 142 (1). If you fail to file taxes before these dates, Section 139(4) allows you to file belated or late returns.
Assessees can file belated IT returns within a year from the end of the relevant assessment year as per Section 144. However, if an assessee fails to file returns within the assessment year, he/she may be charged a penalty of Rs. 5,000 under Section 271F. This penalty is not applicable to taxpayers who do not need to file mandatory returns.
Section 139(4A), Section 139(4B), Section 139(C) and Section 139(4D)
Some taxpayers may receive income from voluntary contributions (referred to in Section 24(2)) or from charitable and religious trusts. Under Section 139 (4A), such individuals need to file ITR only if their total income exceeds the maximum permissible amount.
Section 139(4B) is specifically made for political parties or parties with political affiliations. The CEO (Chief Executive Officer) or Secretary of such organisations have to file ITR if the total income exceeds the maximum tax-exempt limit.
Section 139 (4C) covers institutions such as new agencies, hospitals, medical institutions, institutions working in scientific research, etc. These entities have to file an ITR only if the amount accumulated exceeds the maximum exemption limit.
Under Section 139(4D), educational institutions like universities and colleges do not need to file ITR. Moreover, they do not need to carry forward losses.
Section 139(5): Revised ITR
In many situations, taxpayers end up making mistakes and errors when filing taxes. Fortunately, Sub-section 5 under Section 139 of the Income Tax Act allows you to correct your mistakes with revised ITR.
Under Section 139(5), you can file a revised ITR within a year from the end of the relevant assessment year. Otherwise, you can file it before the completion of the tax assessment if it happens sooner. There are no restrictions on the number of times you can use this facility.
Section 139(5) does not allow corrections of intentional mistakes, fraudulent filing or concealment. It also does not allow you to revise belated or late income tax filing but allows you to correct loss returns filed within due dates.
Section 139(9) — Defective Returns
This Sub-section deals with defective returns, which have certain defects outlined by Section 139(9). If the AO (Assessing Officer) determines that an ITR is defective, he/she may notify the assessee and allow you to correct these defects. Usually, AOs give a period of 15 days to rectify such defects but may offer an extension if you offer a valid reason.
Final Word
Section 139 of the Income Tax Act deals with the various income tax returns that taxpayers can file. Different individuals, entities, and institutions can file ITR even if they are late or have made mistakes. You will need to be aware of the due dates to file tax returns.
FAQs on Section 139 of the Income Tax Act
Ans: Under Section 234F, you have to pay late filing fees for filing income tax returns after the due date. If you file ITR after September 30 but before December 31, a penalty of Rs. 5,000 will be applicable. For returns filed after December 31, the penalty will increase to Rs. 10,000.
Ans: The following due dates are applicable for filing ITR:
July 31: This deadline is applicable for all assessees who do not need an audit.
September 30: Assessees required to have an audit performed on books of accounts have to file ITR within September 30 of an assessment year
Ans: Yes, interest at a 1% rate per month is applicable under Section 234A till the payment of all outstanding taxes. If an assessee is not liable to pay any tax, no interest is applicable for the late filing of tax returns. This interest is charged in addition to the late filing penalty.
Ans: Individuals with sources of income other than salary, including rent, capital gains, shares, etc., need to pay advance taxes. If your tax liability from these sources is more than Rs. 10,000 in a financial year, you need to pay taxes in instalments within prescribed due dates.
Ans: The Finance Act 2019 stipulated that taxpayers who took part in high-value transactions have to file ITR mandatorily. This rule is applicable even if their total income does not exceed the basic exemption limit.
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