CIRCULAR NO. 5 / 2007, DATED 26-7-2007

The Central Board of Direct Taxes, vide notification S.O. No.762(E) dated 14th May, 2007 have notified following new return forms for assessment year 2007-08 under a new series:-

(i) ITR-1 return of income for individuals having income from salary/ pension/ family pension and not having any other income except income by way of interest chargeable to income-tax under the head Income from other sources;

(ii) ITR-2 return of income for Individuals and Hindu Undivided Families (HUFs) not having any income under the head Profits or gains of business or profession;

(iii) ITR-3 return of income for Individuals and HUFs being partners in firms and not carrying out business or profession under any proprietorship;

(iv) ITR-4 return of income for individual and HUFs having proprietory business or profession;

(v) ITR-5 combined form for return of income and fringe benefits for Firms/ Association of Persons / Body of Individuals;

(vi) ITR-6 combined form for return of income and fringe benefits for companies (other than companies claiming exemption under section 11;

(vii) ITR-7 combined form for return of income and fringe benefits for persons including companies required to furnish return under section 139(4A) or section 139(4B) or section 139(4C) or section 139(4D);

(viii) ITR-8 stand alone form for return of fringe benefits for persons who are not required to furnish return of income but are required to furnish return of fringe benefits.

The above return forms are available at http//www.incometaxindia.gov.in.

2. Rule 12 of the Income-tax Rules has also been substituted by a new rule with effect from 14th May, 2007 for furnishing the return of income/ fringe benefits in the above mentioned Forms.

In sub-rule (5) of the said rule, it has been provided that the return of income/ fringe benefits for assessment year 2006-07 or any earlier assessment years shall be furnished in the appropriate form as applicable in that assessment year.

3. Sub-rule (3) of rule 12 provides that return of income/ fringe benefits can be furnished in any of the following manners:-

(i) furnishing the return in a paper form;

(ii) furnishing the return electronically under digital signature;

(iii) transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V;

(iv) furnishing a bar-coded return in a paper form.

4. In exercise of powers conferred by section 139D read with clause (eebb) of sub-section (2) of section 295, it has been provided in sub-rule (3) of rule 12 that it shall be mandatory for the firms to whom provisions of section 44AB are applicable and for the companies (other than the companies claiming exemption under section 11) to furnish the return of income/ fringe benefits electronically in the manner mentioned at (ii) or (iii) of paragraph 3. The return of income/ fringe benefits in Form ITR-7 by charitable/ religious trusts, political parties and other non-profit is to be furnished in the paper form only. All other taxpayers has the option to furnish the return of income/ fringe benefits in any of the manner mentioned in paragraph 3.

5. In exercise of powers conferred by section 139C read with clause (eeba) of sub-section (2) of section 295, it has been provided in sub-rule (2) of rule 12 that the return to be furnished in above mentioned Forms (except in ITR-7) shall not be accompanied by any attachments/ annexures. Thus, taxpayers should not enclose with these return forms any statement showing the computation of income or tax, copies of balance-sheet, profit and loss account, TDS/ TCS certificates, proof of payment of advance tax or self-assessment tax. However, these documents shall have to be produced before the Assessing Officer on demand by him. The Chief Commissioners of Income-tax/ Commissioners of Income-tax must ensure that documents, if any, annexed with these returns or Form ITR-V are detached at the time of receiving these returns/ ITR-V and return the same to the taxpayers immediately.

6. Following clarifications are also issued in respect of certain issues arising from furnishing the returns in the above mentioned forms:

(i)The report of audit under section 44AB is not to be attached with the return. It should not be furnished separately also before or after the due date. However, an assessee should get the report of audit from an accountant under said section before the due date of the furnishing of the return and should fill out the relevant columns of these forms on the basis of such report. The assessee should retain the report with himself. It may be furnished in original during the assessment proceedings. No penalty under section 271B shall be initiated or levied for not furnishing the tax audit report on or before the due date. However, if the audit report has not been obtained before the due date, provisions of section 271B shall be attracted.

(ii)These returns are not to be accompanied with any other document including any statutory form or report of audit (other than the report under section 92E) which is otherwise required to be furnished before the due date or along with the return for making any claim. The provisions of the law shall be deemed to have been complied with in respect of the requirement of the filing of the attachments or documents or reports along with the return. No penalty shall be initiated/ levied for not furnishing such documents if such documents were otherwise obtained before the specified date, if any, provided in the statute. All these documents should be retained by the taxpayers and be furnished in original during the scrutiny proceedings.

(iii)The report as required under section 92E of the Income-tax Act shall continue to be furnished before the date specified in rule 10E.

(iv)In case, a return is furnished under digital signature, the date of such furnishing shall be the date of furnishing the return. In case, the assessee chooses to transmit the data in the return electronically and thereafter submit the verification of the return in form ITR-V, the date of transmitting the data electronically will be the date of furnishing the return if ITR-V has been furnished within fifteen days from the date of transmitting the data electronically. In case, Form ITR-V, is furnished after the above mentioned period, the date of furnishing Form ITR-V shall be deemed to be the date of furnishing the return. Further, in case, Form ITR-V is not furnished, it will be deemed that no return has been furnished.

(v)The e-Return has to be furnished at http://incometaxindiaefiling.gov.in. The ITR-V shall be furnished at separate counter(s) to be set up exclusively for this purpose at each local income-tax office (whether on net-work or not).

(vi)The ITR-V Forms are bar-coded. Therefore, CCITs/ CITs must ensure that these Forms are handled and stored with care and caution. While storing the returns, precaution should be taken not to fold them. These ITR-Vs should be sent to the RCCs immediately.

7. Separate instructions regarding the procedure for processing the returns filed electronically and verified in Form ITR-V are being issued separately.

8. The returns filed electronically shall be processed on priority basis.

            [F.No.142/3/2007-TPL]