ICAI - Practical difficulties in filing of Income tax Returns
July, 08th 2009
DTC/2009-10/Rep-4 30 June, 2009
Shri. S.S.N.Moorthy Chairman Central Board of Direct Taxes Ministry of Finance Government of India North Block Delhi-110 001
Re: Request to consider some hardships and practical difficulties likely to arise in the filing of Income tax Returns for A.Y. 2009-10 with respect to the directions given in the CBDT Circular No. 03/2009 dated 21-05-2009.
This has reference to the CBDT Circular No. 3/2009 dated 21-05-2009 which lays down certain guidelines for filing of ITR-1 to ITR-8 for Assessment Year 2009-10. We appreciate the effort of the Government on insisting for strict compliance by all officers and staff of the Department to ensure that there is no refusal to accept Income-tax Returns on the ground that they are not accompanied with annexures.
However, we have been receiving representations from members from all parts of the country explaining the difficulties which may be faced by the assessees while following the directions mentioned in the said circular. The difficulty mainly concerns with the submission of ITR-V.
The circular mentions that in case the return is furnished electronically without a digital signature, the tax-payer is required to furnish the Form ITR V with the Income-tax Department at the mentioned address in Bangalore to follow-up the electronic transmission of the data as a verification of the electronic filing of the return.
In such a case, the date of transmitting the data electronically will be the date of furnishing the return only if the Form ITR V is furnished within thirty days after the date of transmitting the data electronically. In case, Form ITR V, is furnished after the above mentioned period, it will be deemed that the return in respect of which the Form ITR V has been filed was never furnished and it shall be incumbent on the assessee to electronically re-transmit the data and follow it up by submitting the new Form ITR V within thirty days.
The assessee is required to furnish the Form ITR V to the Income-tax Department by mailing it to Income Tax Department CPC, Post Box No. 1, Electronic City Post Office, Bangalore 560100, Karnataka within thirty days after the date of transmitting the data electronically. The Post Box shall deliver all the Form ITR V to the Centralized Processing Centre (CPC) of the Income-tax Department in Bangalore. Upon receipt of the Form ITR V, the CPC shall send an e-mail in due course to the e-mail address furnished by the tax-payers in their return. No Form ITR V shall be received in any other office of the Income-tax Department or in any other manner.
Earlier, Form ITR V was required to be filed by an assessee with the office of his Assessing Officer, which was duly acknowledged by affixing the Departments stamp and seal on the same. Under the proposed new guidelines, since ITR V is to be sent by post to Bangalore City Post Office, there is no acknowledgment for the acceptance of the same, except the e-mail communication.
In this regard it may be noted that the address given refers to a Post Box Number and no registered post of the Indian Post Office is accepted where the letters to be delivered are addressed to Post Box No. The only choice left with the assessee is to send through under postal certificate or a private courier service. Under a statutory framework, it may neither be proper and nor be legal, if the assessee is not able to get proof of delivery of such a vital document as ITR V. It is quite possible that ITR V has not been delivered on time on account of postal delay for no fault of the assessee. Further, there is a possibility of loss in transit also. The assessee has no proof for his submission of ITR-V within specified time. Under these circumstances, the proposed provision to treat the return filed electronically as deemed to never have been furnished, even for no fault on part of the assessee would result in adverse consequences such as levy of penal interest under Sections 234A and 234B, deprivation of the claim for carry forward of losses and deductions under Chapter VIA, levy of penalty under section 271F etc.
Another difficulty which may be faced by the assessee is that the ITR V is to be filed within 30 days of electronic furnishing of the return. In most of the cases the assessees do not have the requisite software for electronic furnishing of returns. They depend on the services of Chartered Accountants to file returns. This puts the position of a Chartered accountant in great difficulty as he is required to monitor the limit of 30 days for each and every return.
It is, therefore, suggested that:
A) Form ITR-V may be allowed to be submitted by the assessee to the respective Assessing Officers having jurisdiction over the assessee as before. The Income-tax Department may be required to collect these forms and send the same to the Bangalore office.
B) The assessee may be allowed to file the ITR V within 30 days from the end of the month in which the return has been electronically furnished.
An appropriate amendment in the circular to that effect would be highly appreciable. Warm Regards