Section 139(1) : Filing of Return of Income ( ROI )

 

Section 139(1) :  Filing of Return of Income ( ROI ) 

Section 139(1) of the Income Tax Act, 1961, is a crucial provision that deals with the filing of income tax returns by individuals and businesses. In this blog post, we will delve into the details of this section, its applicability, and the consequences of non-compliance.

What is Section 139(1)?

Section 139(1) of the Income Tax Act requires every person who is required to file a return of income to furnish such return in the prescribed form and manner. The section applies to:

- Individuals who have taxable income exceeding the basic exemption limit.

- Hindu Undivided Families (HUFs).

- Association of Persons (AOPs).

- Body of Individuals (BOIs).

- Companies.

- Firms.

- Local Authorities.

- Artificial Juridical Persons.

Who is required to file a return of income?

The following individuals and businesses are required to file a return of income under Section 139(1):

- Individuals with taxable income exceeding ₹2,50,000.

- Senior citizens with taxable income exceeding ₹3,00,000.

- Very senior citizens with taxable income exceeding ₹5,00,000.

- Companies, firms, and LLPs with taxable income.

- Businesses with turnover exceeding ₹60 lakh.

- Professionals with gross receipts exceeding ₹10 lakh.

Consequences of non-compliance

Failure to file a return of income under Section 139(1) can result in:

- Penalty of ₹1000 to ₹5,000.

- Interest on the tax payable.

- Prosecution for non-compliance.

- Denial of carry forward of losses.

- Denial of refund of taxes.

Here's an example to illustrate the application of Section 139(1):

Suppose Mr. XYZ, a salaried individual, has a taxable income of ₹3,50,000 for the financial year 2023-24. He is required to file his income tax return under Section 139(1) since his income exceeds the basic exemption limit of ₹2,50,000.

If Mr. XYZ fails to file his return by the due date (July 31, 2024), he may be liable for:

- Penalty of ₹1,000 to ₹5,000 under Section 234F

- Interest on the tax payable under Section 234A

To avoid these consequences, Mr. XYZ should file his income tax return in the prescribed form (ITR-1) and manner (online) by the due date.

Note: The example is for illustration purposes only and may not represent actual tax scenarios or calculations.

Conclusion

In conclusion, Section 139(1) of the Income Tax Act is a critical provision that requires individuals and businesses to file their income tax returns in a timely manner. Non-compliance with this section can result in severe consequences, including penalties, interest, and prosecution. It is essential to understand the applicability and requirements of this section to ensure compliance with the Income Tax Act.

Here are some frequently asked questions related to Section 139(1) of the Income Tax Act:

Q: Who is required to file a return of income under Section 139(1)?

A: Individuals, HUFs, AOPs, BOIs, companies, firms, and LLPs with taxable income or business income are required to file a return of income.

Q: What is the due date for filing a return of income under Section 139(1)?

A: The due date is July 31 of the assessment year for individuals and October 31 for companies.

Q: What happens if I fail to file my return by the due date?

A: You may be liable for penalty, interest, and prosecution for non-compliance.

Q: Can I file a revised return if I have made a mistake in my original return?

A: Yes, you can file a revised return under Section 139(5) before the end of the relevant assessment year.

Q: What is the consequence of not filing a return of income?

A: You may be denied carry forward of losses, refund of taxes, and may face prosecution.

Q: Can I file a return of income manually?

A: No, from Assessment Year 2020-21 onwards, all returns must be filed electronically.

Q: Who is exempt from filing a return of income?

A: Individuals with taxable income below the basic exemption limit (₹2,50,000) and senior citizens with taxable income below ₹5,00,000 are exempt from filing a return.