Liability of the assessee

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 April 2012 A person has made the LTCG by selling the house and invest the LTCG amount to buy the house to get the exemption.
In the case of an indivisual the ordinary liablity to file the return is 31st July.
but he did not file the return on 31st July.

After that cash is seized from that person of Rs.6,00,000 in Nov.
He explained the source of money (6,00,000)to the sezing office.

He filed his return in Dec.

Notice is issused to him by the department U/S 132B in January.

What is the remady avaliable to him to get his cash back.What is the time limit to decide the case.

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
Follow

07 May 2012 If the cash seized is not undisclosed income then not to worry nothing can be done and the refund can only be given to you after the assessment is completed but at the time if assessment you should give full details with an evidence of filing the details. generally in case 132 the ITO would like to assessee you at a higher income then your returned income and the tax liability is also determined at much higher amount then the seized and taxes if any paid by you.

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

07 June 2012 But the question is that the person has not filed the return by due date.Does it make any difference?

Upgrade to CAclubindia Pro. Subscribe Now!

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
Follow

02 August 2024 When dealing with the seizure of cash and the filing of returns related to long-term capital gains (LTCG), it is essential to understand the legal remedies available and the implications of not filing returns on time. Here’s how to approach the situation:

### 1. **Understanding the Situation:**

- **LTCG Exemption:** The individual made LTCG by selling a house and invested the amount to buy a new house to claim exemption under Section 54 of the Income Tax Act.
- **Return Filing Due Date:** The due date for filing income tax returns for an individual is generally July 31st of the assessment year.
- **Seizure of Cash:** The person’s cash amounting to Rs. 6,00,000 was seized in November.
- **Return Filing Status:** The return was filed in December, after the seizure but after the due date.

### 2. **Legal Remedies and Process:**

**a. **Filing the Return:**

- **Delay in Filing:** Although the return was filed after the due date, it does not necessarily invalidate the claim for exemption. The person should ensure that the return is filed correctly and includes all necessary documentation to support the claim of LTCG exemption.

**b. **Seizure of Cash:**

- **Section 132B:** Under Section 132B of the Income Tax Act, which deals with the seizure and retention of assets, the taxpayer can request the release of the seized cash if they can prove the source and legitimacy of the funds.
- **Proving the Source:** The person should provide clear documentation and evidence to the authorities to demonstrate that the seized cash is legitimate and related to their income and transactions.

**c. **Procedure to Get Cash Released:**

- **Representations:** The person should make a representation to the Income Tax Department, explaining the source of the seized cash and how it relates to the reported income. This can be done by submitting a detailed letter or application to the assessing officer or the department handling the seizure.
- **Supporting Documents:** Provide all necessary supporting documents, such as bank statements, proof of income, and other relevant financial records.

**d. **Time Limits and Resolution:**

- **Decision Time Limit:** The time limit for the department to decide on the release of seized cash is not explicitly defined, but the department should generally make a decision within a reasonable period after reviewing the evidence provided.
- **Follow-Up:** Regular follow-ups with the department and ensuring all required documents and clarifications are provided promptly can help in expediting the process.

**e. **Legal Recourse:**

- **Appeal or Review:** If the department does not release the seized cash or the decision is unfavorable, the individual can file an appeal or request a review of the decision through appropriate legal channels.

### 3. **Impact of Delay in Filing Return:**

- **Impact on Exemption:** The delay in filing the return does not automatically affect the claim for LTCG exemption, but penalties or interest might apply for late filing.
- **Compliance:** Ensure that the return includes all necessary details to support the claim and complies with the Income Tax Act.

### 4. **Recommended Steps:**

1. **Ensure Accurate Return Filing:** Verify that the return includes all necessary information to support the LTCG exemption claim.
2. **Submit Evidence:** Provide comprehensive evidence and documentation to the department to substantiate the legitimacy of the seized cash.
3. **Follow-Up with Authorities:** Engage with the Income Tax Department to ensure timely processing and resolution of the seized cash issue.
4. **Seek Professional Advice:** Consider consulting a tax professional or lawyer to navigate the complexities of the case and ensure proper compliance and representation.

By following these steps, the individual can address the seizure issue and work towards the release of their seized cash while ensuring compliance with tax regulations.