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Income tax query urgent

Pooja (.) (194 Points)

14 May 2013

Hi friends,

One of my client filed her return for the A.Y.11-12 belatedly in March 12. Her source of income was only FD Interest and there were 2 tds certificates one of Rs 13000 and the oher of Rs 19000. Now the issue is the accountant who filed her return showed the FD interest only from one bank and claimed refund of Rs 13000. The details of other FD interest and tds on 19000 was not disclosed in income tax return. Now the CPC says that the return has been transferred to the local tax department and we cannot issue the refund from Bangalore. My query is if I go to the local department, can they raise issue for the FD interest which was not shown?

Friends this is really urgent. I request you to kindly help me out with your suggestions and opinions.

Thanx in advance

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15 Replies

CA D.C. Bansal (Accounts Head) (283 Points)
Replied 14 May 2013

Return can be revised, if it is filed within the prescribed time i.e. belated return can not be revised. The latest date for revising the return for the A/Y 2011-12 was 31.03.2013 which has expired. Therefore, you can not revise the return.

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CA Naresh Pareek (Practicing Chartered Accountant) (170 Points)
Replied 14 May 2013

You can file online return u/s 154 . If it is accepted by the department then your problem will be resolved. If it is not accepted then you will have to visit the local office of the department personally.

AMIT KUMAR JAIN (CA) (94 Points)
Replied 14 May 2013

Originally posted by : CA Poonam

The First Option is rectification U/s 154 as suggested by Mr. Naresh.

The Second option is for you to wait till you get a Notice u/s 142 and at that time reveal the income and pay tax along with interest and get refund of the balance amount, if any. But this option is not suitable as it will attract Penalty u/s 271(1)(c) on account of concealment of Income which may vary from 100% to 300% of tax sought to be evaded.

Thus, better option for you is to go for rectification u/s 154.

CA. ESHAN GOYAL (ca) (63 Points)
Replied 14 May 2013

As per Sec 154, the income tax authorities (ITO/AO/CIT/CCIT) can rectify a mistake in an assessment
order or intimation u/s 143(1) if such mistake is “apparent” from the record".

What are the examples of mistake apparent from record?

TDS/Advance tax/MAT credit not claimed by assessee or short claimed or claimed in excess.

Time limit for passing order u/s 154:

No rectification shall be made by AO after the expiry of four years from the end of the financial year in
which the order subject to rectification was passed. The same is the time limit for assessee to apply for
rectification. .[Sec 154(7)].

HENCE FILE file a rectification application to AO
U/S 154

power to rectify is mandatory and not discretionary. POWER OF AO ..

Rashmi (Accountant) (140 Points)
Replied 15 May 2013

Better option for you is to go for rectification u/s 154.

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Bipin (HR) (42 Points)
Replied 15 May 2013

Please share the TAX deduction rate applicable on LEAVE ENCASHMENT by AN EMPLOYEE of a PRIVATE LIMITED COMPANY

CA Ketan Kothari (Associate Consultant) (86 Points)
Replied 15 May 2013

Hello Poonam,

As you already know belated return cannot be revised.

The only option left for you is to file a return u/s 154.

This would help you to rectify the mistake doen in the previous return.

Thanks

CA Ketan Kothari (Associate Consultant) (86 Points)
Replied 15 May 2013

Hello Poonam,

As you already know belated return cannot be revised.

The only option left for you is to file a return u/s 154.

This would help you to rectify the mistake doen in the previous return.

Thanks

CA Ketan Kothari (Associate Consultant) (86 Points)
Replied 15 May 2013

Hello Bipin,

Leave encashment becomes a part of the salary provided to the employee. As this becomes part of the salary there is no direct rate provided for leave encashment.

TDS to be deducted would depend upon the salary of the employee u/s 192. Section 192 states that TDS on salary would be dedcuted on the basis of income slab of the relevant ASsesment year.

Thanks

Regards

Ketan Kothari

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CA D.C. Bansal (Accounts Head) (283 Points)
Replied 15 May 2013

I doubt whether 154 may be invoked in this case. 154 may be invoked if mistake is apperant from the records but here income has been escaped which may not be apperant from the records. Rectification may be made based upon what records was available with the Assessting Officer at the time of Passing the order intended to be rectified. But in this case this TDS details was not available with the AO at the time of passing the order. Even though you may try.

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Pooja (.) (194 Points)
Replied 15 May 2013

Thanx a lot friends for your opinion and suggestions. Greatful to u guys. I ll File sec 154 online.I think that is the best option.

Thanx a lot friends for spending your valuable time in giving suggestions. Thanx

S.C GOEL (CHARTERED ACCOUNTANTS) (31 Points)
Replied 15 May 2013

Hello Poonam,

The option suggested by Mr Amit Jain seems convincing with only difference that notice would be u/s 148. To avoid penalty U may suo motto file a return declaring ascaped income to the income already returned. The department may issue notice under section 148 asking to file a complete and correct return. The same may be responded by filing a return or by wrting to the ITO that the return filed earlier may be treated as filed in response to this notice. by this process the case may be get regularised and U may get the due refund. Regards

CA SURESH GOEL

Rashmi (Accountant) (140 Points)
Replied 15 May 2013

Der, S.C GOEL CHARTERED ACCOUNTANTS

As you have used many may be, could you please share any reference of such kind cases, that might have be in your refenence, as CA Poonam mentioned it is a belated return.

Pooja (.) (194 Points)
Replied 16 May 2013

So should i file a return u/s 154 for the relevant A.Y.? And penalty can be levied only when tax is ought to be evaded. In this case we havent sought to evade any tax because the gross total income is below the basic exemption limit and also we have failed to claim refund. So should i file return u/s 154?

Also the same mistake has been done in A.Y 2012-13. FD interest has notben shown and only salary income has been shown and the refund thereon has been given by the department. In A.Y 12-13 since form 15G was given no tds was deducted from the interest.

Thanx in advance