Yesterday ( 31St July) was last date to file ITR for AY 2013-14 & Pay tax due on this. People including me were so busy to complete this unwanted task (Hated for few Tax Payers). Many were gathering their info in last minute; few people were searching for their Form 16. Few people were calling their beloved consultants/CAs to find whether he is “Eligible for Not Filing ITR or whether Filing ITR is mandatory or not” and others were questions on type of ITR need to be used and type of Income need to be disclosed too. People’s mind was like MAJESTIC (BANGALORE BUS STAND) VIRTUALLY.
In the hurry, most of the people will disclose their income wrongly /will use wrong ITR Form or Will use wrong Form 16 to compute or will use wrong interpretation of Income Tax Provisions to fill their form. At the end, they will be happy to see GENERATED Form ITR V – Acknowledgement copy. A Smile on their face of winning a big race or war once they see ITR V. Most of the people will try to communicate their success of filing or their interpretation of law to others so that they can follow their best practices acquired in last minute. I am sure employer (Company) is only one who had not smiled yesterday because most of his resources – Computer, Printer & Phone etc, are used by employees for filing their ITR J
Above situation was there in all most all companies and govt offices till 2 PM yesterday. They got know “ EXTENSION OF DUE DATE For Filing ITR” through various sources. Thanks to Social Media – FB & TWITTER and emails. News spread everywhere. Scenario got changed; Mind of People which was like Majestic with all type of tensions became relax. Happy mood everywhere.
This small article or write up is to bring notices to all that, they had missed important part in that news “FOR FILING OF ITR”. Govt had only extended only FILING DATE, NOT FOR PAYMENT OF TAX DUE. So news on EXTENSION is not sweet as people had imagined earlier. People need to pay extra Interest of 1% for their tax due if their tax due is more than Rs 10,000. Section 234B is applicable. BETTER TO FILE ITR EARLIEST & ACCURATELY w/o delay
234 B – It is mandatory section of income tax act. This section is attracted for non-payment of advance tax. Advance Tax is applicable to everyone including salaried people if tax due exceeds Rs 10,000. Interest at 1% on Assessed Tax is applicable from April 1st till date of Payment. Assessed Tax is TAX ON TOTAL INCOME MINUS DEDUCTION AND TDS. So 234B is still applicable even though Due date of FILING is extended
Eg: If X Salaried person is having tax payable as Rs 1 lakhs after all TDS adjustment & deduction claimed because of change in Company’s job or any other Income on 31st July, then he is liable to pay Rs 1% interest on Rs 1 lakh per month. So he will be paying Rs 3000 interest in addition to above tax. If because of Extension news yesterday, people who wants to do filing of ITR today or before 5th August, then he needs to pay Rs 1% extra. So X need to Rs 1000 as Interest along with Rs 103000. So X had lost Rs 1000 because of 1 day delay in payment of Tax. People who had paid and filed ITR yesterday had saved (earned) 1% interest by filing ITR on time.
So 234B section will follow assesse till he pays all his due till date of ASSESSMENT ORDER. So people who had filed wrongly because of hurry/ wrong interpretation need to shell out 1% every month as interest. If X had filed ITR wrongly or used wrong interpretation of section in filling ITR & he got assessment Order after 3 years, then he needs to pay 36% interest along with assessed tax,
Better to file ITR accurately & On time after assessing Tax Payable correctly and paying of Tax fully. Otherwise Section 234B will follow you like Hutch Dog
PS: Your ITR will be Deemed Defective as per new amendment to Section 139(9) as an Explanation. Unless ASSESSED TAX TOGETHER INTEREST AS IN 234A, B & C has been paid in accordance with Section 140A of Income Tax Act through SELF ASSESSMENT – FORM 280 before filing your ITR, ITR IS DEEMED TO BE DEFECTIVE. IT Department is having power to levy huge penalty or can do recovery of Tax by forfeiting bank account and assets
CA CHIKKERUR C R
B.Com, ACA, MBA, DISA & LLB
CAclubindia
