Missing an income tax return due date under section 139(1) is not a harmless slip—it triggers a defined chain of statutory consequences spanning fees, interest, denial of benefits, assessments, penalties, and even prosecution. This blog compiles the relevant provisions, quotes key language from the Act for precision, and illustrates with worked examples so you can see the real money impact.

 Core filing obligation and timelines

Section 139(1): Who must file and by when 🗓️📄

“Every person,— (a) being a company or a firm; or (b) being a person other than a company or a firm, if his total income … during the previous year exceeded the maximum amount which is not chargeable to income-tax, shall, on or before the due date, furnish a return of his income … in the prescribed form and verified in the prescribed manner…” 🏛️📄

“Due date” includes, broadly: —

Sr. No.	Due dates	Required Assessees
1.	31st July or extended date	For persons not required to get accounts audited 🗓️
2.	31st October or extended date	For persons who are required to get accounts audited 🗂️
3.	30th November or extended date	For persons who are covered by transfer pricing report requirements 🏢

• Additional compulsions to file: 📝🔥 Separate provisos and notifications require filing even below the basic exemption in specified cases (e.g., foreign assets/signing authority; high-value transactions; section 139(1) fourth proviso for residents other than not ordinarily resident holding foreign assets).
• Practical pointer: Total income for the threshold test is computed before giving effect to chapter VI-A deductions and certain exemptions. 🧮

 

What if you missed the due date?

Belated return window 🕰️🧾

Section 139(4): Belated return

“Any person who has not furnished a return within the time allowed to him under sub-section (1) may furnish the return for any previous year at any time before three months prior to the end of the relevant assessment year or before the completion of the assessment, whichever is earlier.”

• Effect: You can still file, but you will pay late fee and interest, and you lose certain benefits tied to timely filing.

Section 139(5): Revised return 🔄✍️

“If any person, having furnished a return under sub-section (1) or sub-section (4), discovers any omission or any wrong statement therein, he may furnish a revised return … within the time allowed under sub-section (4).”

• Effect: You can correct genuine mistakes, but only within the same reduced time frame (generally up to 31 December of the assessment year).

Section 139(9): Defective return ⚠️📄

“Where the Assessing Officer considers that the return of income furnished by the assessee is defective, he may intimate the defect … and if such defect is not rectified … the return shall be treated as an invalid return, and the provisions of this Act shall apply as if the assessee had failed to furnish the return.”

• Effect: A defective return that is not cured becomes “non-filing” in law, with all attendant consequences.

 

Consequences that hit your pocket

Late filing fee

Section 234F: Fee for default in furnishing return

“Where a person required to furnish a return of income under section 139, fails to do so within the time prescribed … he shall pay, by way of fee, a sum of five thousand rupees: Provided that if the total income of the person does not exceed five lakh rupees, the fee payable shall not exceed one thousand rupees.”

• Financial implication:
  • Income > ₹5,00,000: ₹5,000
  • Income ≤ ₹5,00,000: ₹1,000

 

Interest for delay and shortfall

Section 234A: Interest for defaults in furnishing return

“Where the return of income … is furnished after the due date … the assessee shall be liable to pay simple interest at the rate of one per cent for every month or part of a month comprised in the period from the date immediately following the due date to the date of furnishing of the return on the amount of the tax on the total income as determined … as reduced by [TDS/TCS, reliefs, advance tax, self-assessment tax already paid].”

• Financial implication: 1% per month (or part) on net tax payable till the date you file.

Section 234B: Interest for defaults in payment of advance tax

“An assessee who is liable to pay advance tax … has failed to pay such tax or … the advance tax paid is less than ninety per cent of the assessed tax, shall be liable to pay simple interest at the rate of one per cent for every month or part of a month … from 1st April of the assessment year to the date of determination under section 143(1) or regular assessment.”

Section 234C: Interest for deferment of advance tax

Imposes 1% per month for shortfalls against every installments, (15 June, 15 September, 15 December, 15 March) based on prescribed percentages of “tax due on returned income.”

• Financial implication: Even salaried taxpayers with significant “other income” can face 234B/234C if advance tax was not adequately paid.
• Denial of carry-forward of losses ✋📉

Section 139(3) read with Section 80: Filing return to carry forward loss

“If any person has sustained a loss in any previous year under the head ‘Profits and gains of business or profession’ or under the head Capital gains and claims that the loss or any part thereof should be carried forward … he may furnish a return of loss … within the time allowed under sub-section (1) of section 139…”

“No loss which has not been determined in pursuance of a return filed in accordance with the provisions of sub-section (3) of section 139, shall be carried forward and set off …” (Section 80)

• Exceptions: Carry-forward of house property loss [section 71B] and unabsorbed depreciation [section 32(2)] do not depend on timely filing.

 

Denial of certain deductions if filed late

Section 80C (and 10AA): Due date condition for key incentives

“Where … any deduction is admissible under any provision of this Chapter under the heading ‘C.—Deductions in respect of certain incomes’ … no such deduction shall be allowed unless the return of income for such assessment year is furnished by the due date specified under sub-section (1) of section 139.”

• Effect: Deductions like 80-IA/80-IB/80-IC, 80JJAA, etc., and 10AA (SEZ) are lost if the return is not filed by the section 139(1) due date.

 

Option to tax regime and due-date linkage (business/profession) ⛔💼

Section 115BAC(5)/(6): Exercise/withdrawal of option

The option for individuals/HUFs having business or professional income must be exercised “on or before the due date specified under sub-section (1) of section 139” and is generally binding for subsequent years unless withdrawn per rules.

• Effect: If you have business/professional income and miss the due date, your ability to choose the preferred regime for that year can be constrained by statute.

 

What the Department can do if you don’t file

Inquiry and best judgment

Section 142(1): Inquiry before assessment

“The Assessing Officer may serve on any person who has not made a return within the time allowed under sub-section (1) of section 139 a notice requiring him to furnish a return of his income … or to produce accounts or documents …”

• Non-compliance penalty: Repeated failures can invite penalties under section 272A(1) (₹10,000 per default).

 

Section 144: Best judgment assessment

“If any person fails to make the return required under sub-section (1) of section 139 and has not made a return or a revised return under sub-section (4) or sub-section (5) of that section, [or] fails to comply with all the terms of a notice issued under sub-section (1) of section 142 … the Assessing Officer … after taking into account all relevant material … shall make the assessment of the total income … to the best of his judgment…”

• Effect: Income can be estimated unfavourably; disallowances are common; protective additions may be made.

 

Reassessment exposure (if income has escaped assessment)

Section 148A/148: Notice and reassessment

If information suggests your income escaped assessment, the AO can (after following section 148A procedure) issue notice under section 148 requiring a return, even if you never filed originally.

 

Penalties and prosecution exposure

Under-reporting and misreporting

Section 270A: Penalty for under-reporting and misreporting of income

“The Assessing Officer … may direct that any person who has under-reported his income shall pay … a sum equal to fifty per cent of the amount of tax payable on under-reported income.” “In a case where under-reported income is in consequence of any misreporting … penalty shall be two hundred per cent of the amount of tax payable…”

• Examples of misreporting: Misrepresentation or suppression of facts, failure to record investments, false entries, etc.

• Prosecution for wilful non-filing

Section 276CC: Failure to furnish returns of income

“If a person wilfully fails to furnish in due time the return of income which he is required to furnish under sub-section (1) of section 139 … he shall be punishable,— (i) where the amount of tax, which would have been evaded if the failure had not been discovered, exceeds twenty-five lakh rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine; (ii) in any other case, with rigorous imprisonment for a term which shall not be less than three months but which may extend to two years and with fine.”

• Important provisos:
  • No prosecution where tax payable on regular assessment is below the prescribed small amount threshold.
  • Filing after detection does not cure the offence; courts have upheld prosecution even if you later file.

 Updated return route if you missed income

Section 139(8A): Updated return; Section 140B: Tax on updated return

“Any person, whether or not he has furnished a return … may furnish an updated return … within twenty-four months from the end of the relevant assessment year.” “The person shall, before furnishing the updated return, pay the tax together with interest and fee … and the amount of additional tax payable shall be— (a) twenty-five per cent of aggregate of tax and interest, if furnished after the expiry of the time available under sub-section (4) or (5) of section 139 but before completion of twelve months …; (b) fifty per cent … if furnished after the expiry of twelve months but before twenty-four months …”

• Exclusions: Not available in certain cases (e.g., search/requisition/survey cases, or where it results in refund/increased refund).

 

Worked examples with ₹ impact of non-filing ITRs within due dates:

Example 1: Late salaried filer with tax payable and no advance tax

• Profile: Individual (non-audit), FY 2024-25 total income ₹12,00,000, tax payable on return ₹1,50,000 after TDS shortfall of ₹20,000, files on 31 October (3 months late).
• 234F fee: ₹5,000 (income > ₹5 lakh).
• 234A interest: 1% per month on unpaid self-assessment tax. Suppose net payable at filing is ₹20,000. For 3 months:

0.01×20,000×3=6000.01 \times 20{,}000 \times 3 = 600

• 234B interest: Advance tax paid < 90% of assessed tax; interest 1% per month from 1 April to date of intimation/assessment on assessed tax minus prepaid taxes. If assessed tax is ₹20,000:

0.01×20,000×7 (April–Oct)=1,400

• 234C interest: If quarterly advance tax installments were short, add typical few hundred to a couple thousand depending on timing.
• Total extra cost (illustrative): ₹5,000 + ₹600 + ₹1,400 ≈ ₹7,000 plus any 234C.

 

Example 2: Investor misses due date and loses carry-forward

• Profile: Individual with short-term capital loss ₹2,00,000 and small salary (TDS covers tax); files return on 15 November (belated).
• Consequence: Under sections 139(3) and 80, the ₹2,00,000 capital loss cannot be carried forward. Future gains will be fully taxable without set-off.
• Financial implication: If next year has ₹2,00,000 STCG at 15%, extra tax payable will be:

0.15×2,00,000=30,000 (+ surcharge/cess)0.15 \times 2{,}00{,}000 = 30{,}000\ (\text{+ surcharge/cess})

Example 3: Business assessee misses due date; deduction and regime impact

• Profile: Proprietor claiming 80JJAA and considering regime choice; misses 31 October due date.
• 80AC effect: Deduction under 80JJAA is disallowed for missing 139(1) due date—potentially large additional tax.
• 115BAC(5) effect (business income): Option to choose applicable regime must be exercised on or before 139(1) due date; missing it can lock the assessee into the default rule for the year.

Example 4: Non-filing leads to best judgment and penalty

• Profile: Professional with gross receipts ₹40 lakh does not file. AO issues 142(1) notice; no compliance; proceeds under 144, estimates income at 50% of receipts (illustrative) and levies 270A (under-reporting) on the difference.
• Financial implication: Not only full tax plus 234A/B/C, but also 50% penalty on the “under-reported tax,” potentially adding lakhs.

Compliance checklist if you are already late

• File the belated return under section 139(4):
  • Deadline: Generally, 31 December of the assessment year, or earlier if assessment completes.
  • Pay: 234F fee and compute 234A/B/C interest correctly.
• If income was missed earlier, consider updated return under 139(8A):
  • Additional tax: 25% or 50% of tax+interest under section 140B, depending on timing.
  • Check ineligibilities before use.
• Secure benefits that still survive a late return:
  • Carry-forward allowed: House property loss, unabsorbed depreciation.
  • Deductions unaffected by 80AC: General 80C/80D etc. can still be claimed if you file (but watch documentation and computation).
• Respond promptly to any 142(1)/148A notices:
  • Avoid best judgment under section 144 and escalation to penalty/prosecution.
• If business/profession:
  • Review 115BAC option timelines and document the chosen regime in the return or prescribed form.

Quick reference: sections and what they do

Section	What It Does
139(1)	Filing duties and deadlines 🗓️📄
139(3)/80	Carry forward losses’ rules 📉❌
139(4)	Belated return deadline ⏳🧾
234F	Flat late filing fee 💸💵
234A/B/C	Interest for late/short tax payments 📈⏳
80AC/10AA	Deduction forfeiture rules 💔🏦
142(1)/144	AO notices and assessments 📜⚖️
270A	Penalty for under/misreporting 💸⚡
276CC	Prosecution for non-filing 🚨🔒

 

If you have missed the due date for filing your tax returns then don’t worry but at the same time be cautious to file the belated tax returns. Filing belated return will attract certain penalties and interests but it will save you from various other proceedings.

Introduction

As financial year gets ended in the month of March, preparation for Income Tax Return (ITR) filing gets started where department and taxpayers both have to work upon various aspects. Department generally releases ITR forms during May or June and taxpayers compile the documents and rush towards their CAs for ITR compliances. Indian income tax law is considered to be one the most complex tax laws in the world and it is obvious that many complications will be faced by taxpayers for such ITR filing compliances.

To avoid unnecessary hustle, we have simplified the document compilation process for the taxpayers which can be very useful during ITR compliances. Documentary requirements for various ITR forms are different. It is best to discuss the summary of transactions carried out during the financial year with your CAs or advisors and they will suggest a proper ITR form to be filed based on the transactions carried out during the previous year.

Important Documents for ITR 1

Person required to file ITR 1 (Gross income upto ₹50 lac)

1. Income from Salaries
2. Income from House Property
3. Income Other Sources
4. Income from Long term capital gains (listed securities as per section 112A upto ₹1.25 lacs)

Required Documents for ITR 1

1. PAN and Aadhaar number
2. Form 16 from Employer
3. AIS (Annual Information Statement) and TIS (Tax Information Statement)
4. Interest Certificates for saving bank accounts
5. Interest certificates and Account Statements for housing loan
6. Profit and Loss statement for Demat Account (if any)

Note: Form 16 should be accompanied with Form 12BA for arriving the values of various perquisites which are included in the salary. Moreover, if there are more than 2 employers during a financial year or more than a single house property income then ITR 2 shall be applicable. Further, if any investments in foreign assest will be carried out during a financial year then also, ITR 2 will be applicable.

 

Important Documents for ITR 2

Person required to file ITR 2 (Gross income above ₹50 lac)

1. Income from Salaries (more than 2 employers)
2. Income from House Property (more than 1 house property)
3. Income Other Sources
4. Income from Capital gains (including crypto asset)

Required Documents for ITR 2

1. PAN and Aadhaar number
2. Form 16 from Employer
3. AIS (Annual Information Statement) and TIS (Tax Information Statement)
4. Interest Certificates for saving bank accounts
5. Interest certificates and Account Statements for housing loan
6. Profit and Loss statement for Demat Account (if any)
7. Foreign Investment and Income statement
8. Holding statement of Foreign Assets as on 31^st December
9. Profit and Loss statement of Crypto Assets
10. Details of Capital Assests which are sold during previous year

 

Important Documents for ITR 3

Person required to file ITR 3

1. All Income types as per ITR 2
2. Income from Business and Profession

Required Documents for ITR 3

1. PAN and Aadhaar number
2. Form 16 from Employer
3. AIS (Annual Information Statement) and TIS (Tax Information Statement)
4. Interest Certificates for saving bank accounts
5. Interest certificates and Account Statements for housing loan
6. Profit and Loss statement for Demat Account (if any)
7. Foreign Investment and Income statement
8. Holding statement of Foreign Assets as on 31^st December
9. Profit and Loss statement of Crypto Assets
10. Details of Capital Assests which are sold during previous year
11. Financial Statements of the Business or Profession carried out during the previous year
12. Capital account statement from the Firms in which partnership interest was available during previous year

 

Important Documents for ITR 4

Person required to file ITR 4

1. All Income types as per ITR 1
2. Income from Business and Profession – Presumptive Scheme benefit

Required Documents for ITR 4

1. PAN and Aadhaar number
2. Form 16 from Employer
3. AIS (Annual Information Statement) and TIS (Tax Information Statement)
4. Interest Certificates for saving bank accounts
5. Interest certificates and Account Statements for housing loan
6. Profit and Loss statement for Demat Account (if any)
7. Financial Statements of the Business or Profession carried out during the previous year
8. Capital account statement from the Firms in which partnership interest was available during previous year

 

Important Documents for Deductions

Taxpayers who are willing to opt old scheme of taxation shall be required to have following document while complying with ITR filing requirements.

Required Documents for claiming deductions under old scheme of taxation

1. Invoice or Receipts to claim deductions under section 80C (such as LIC, PPF, NPS, Educational Fees etc)
2. Health insurance invoice for claiming deduction under section 80D
3. Interest certificates for claiming deductions under section 80E
4. Donation receipts for claiming deductions under section 80G and 80GGC
5. Invoice or Receipts for claiming any other deductions as per chapter VI of Income Tax Act, 1962

 

Conclusion

It is very important to figure out the proper ITR form to be required to file based on the transaction and nature of the activities carried out during the previous year. CAs or Advisors are the best person who will guide to determine the proper ITR form which should be filed based on the information made available to them. It is important to note that wrong selection of ITR will cause significant challenges where wrongly filed ITR would be considered as Defective ITR under section 139(9) of the Income Tax Act, 1962 and notice of the same would be issued to the taxpayers. Moreover, ITR should be filed within due dates mentioned under section 139(1) of the Income Tax Act, 1962 to carry forward the losses from business or capital gains for future years.

 

Disclaimer:

This article is for general informational purposes only and should not be considered professional advice. Please consult a qualified expert for advice tailored to your specific situation. The author and website owner are not liable for any errors or actions based on this content.

IT Department Launches Nationwide Crackdown on Bogus Tax Deductions

The Income Tax Department of India has launched an aggressive crackdown on fraudulent deduction claims in Income Tax Returns (ITRs). Powered by AI and advanced data analytics, this crackdown is now targeting suspicious claims under specific deduction sections—some of which have been commonly misused by both individuals and intermediaries.

Here’s what you need to know to stay safe and compliant.

What’s Triggering the Crackdown?

A sharp rise in false or exaggerated claims made under various sections of the Income Tax Act has prompted the government to act. Fraudulent practices—often facilitated by unverified intermediaries—are now being flagged by the Income Tax Department’s advanced detection tools.

The crackdown focuses on deductions claimed under the following sections:

Sections Under Scrutiny:

• Section 10(13A) – House Rent Allowance (HRA)
• Section 80GGC – Donations to political parties
• Section 80E – Interest on education loans
• Section 80D – Health insurance premiums
• Section 80EE – Interest on home loans for first-time buyers
• Section 80EEB – Interest on loans for electric vehicles
• Section 80G – Donations to registered charities and relief funds
• Section 80GGA – Donations for scientific research and rural development
• Section 80DDB – Medical treatment for specified critical illnesses

Many of these claims were found to be either inflated or entirely bogus—submitted with fake documents or no proof at all.

AI-Powered Monitoring & Real-Time Cross-Verification

The Income Tax Department is now leveraging AI and data analytics to automatically flag suspicious deduction patterns across thousands of returns. Real-time cross-verification has also been implemented to compare taxpayer claims with actual data from:

• Banks and financial institutions (for loan interest and repayments)
• Insurance companies (for policy premium verification)
• Employers (for rent and HRA)
• Recognized donation platforms and political party disclosures

If a claim doesn’t match backend data, the taxpayer may receive a notice or demand.

Examples of Fraudulent Practices Being Flagged

1. Fake HRA Claims (Section 10(13A)): Claiming rent deductions using fictitious landlords or PANs.
2. Bogus Political Donations (Section 80GGC): False declarations to inflate refund amounts.
3. Fake or Inflated Education Loan Interest (Section 80E): Claiming deductions for non-existent loans.
4. Unsubstantiated Medical Claims (Section 80DDB): Claims without medical certificates or treatment proof.
5. Misuse of Health Insurance (Section 80D): Deducting for lapsed or ineligible policies.
6. Invalid Home Loan or EV Loan Interest (Sections 80EE & 80EEB): Claiming interest deductions without ownership or valid financing.
7. Questionable NGO Donations (Section 80G, 80GGA): Submitting receipts from unapproved or blacklisted institutions.

Legal & Financial Consequences

The Department has already taken action in major cities like Mumbai, Delhi, Jaipur, and Ahmedabad. Hundreds of notices have been served, and several searches and surveys have been conducted under Sections 132 and 133A of the Income Tax Act.

Penalties for false deduction claims may include:

• Demand for repayment of refunds with interest and penalties
• Prosecution under Sections 276C (evasion) and 277 (false statements)
• Imprisonment, in extreme cases

What Taxpayers Should Do Immediately?

• Recheck Your ITR: Ensure that all deductions claimed are accurate and fully supported by documentation.
• Avoid Dubious Tax Advisors: Stay away from intermediaries who guarantee high refunds by misusing deduction sections.
• File an Updated Return (ITR-U): If you realize an error, you can correct it voluntarily through the ITR-U mechanism to minimize penalties.
• Preserve Proof: Maintain receipts, loan sanction letters, insurance policies, and donation certificates for at least 6 years.

Deadline to Act

You can file an Updated Return (ITR-U) for Financial Year 2023–24 up to March 31, 2026. This gives taxpayers a chance to rectify mistakes without attracting harsher consequences—but the longer the delay, the higher the interest and penalties.

Final Takeaway

The Income Tax Department’s message is clear: fraudulent deductions won’t go unnoticed. With technology closing the loopholes, it’s time for every taxpayer to clean up their returns and ensure compliance.

Transparency is not just good practice—it’s now a legal necessity.

Read the source of this post by clicking here.

Disclaimer:

This article is for general informational purposes only and should not be considered professional advice. Please consult a qualified expert for advice tailored to your specific situation. The author and website owner are not liable for any errors or actions based on this content.