Penalty on late filing of IT return

PENALTY ON LATE FILING OF INCOME TAX RETURN
AY 2011- 12
Now A days all tax consultant ,business man,specially
persons who have Earned salary income ,are in rush so that
they can file their income tax return by due date i.e 31 st
July 2011 .we are also one of them.Due date of filing of
income tax return for Assessment Year 2011- 12 (financial
year 2010- 11 )
1. In case of person who are not liable to get their accounts
audited is 31. 07 .2011
2. In case of person who' s accounts are liable to be audited
under any law is 30 .09 .2011 and partner of such firms and
all companies.
In first case( 31 .07 .2011 ) person who has earned income
from salary ,pension, interest income ,capital gain , house
property and person owning small business and not liable to
get their accounts audited are covered.
So nutshell every body is trying to meet the deadline ie
31. 07 .2011 ,I and you are also doing efforts in this
direction ,but do you know
what is the penalty if some one has not filed his return
by due date. .. ... .. ... .. ... .i .e 31 st July 2011 .
any guesses. .. ... .. ..
no guess ,I will tell you , In fact there is no penalty as
such for this fault ,absolutely no penalty ,do you
believe ,I have said that there is no penalty on late filing of
return as such. But this is the fact .Specific penalty for late
filing of return is prescribed u /s 271F which is briefed here
under
"if a person failure to furnish return of income as required
by section 139 before the end of relevant assessment
year ,the assessing officer may impose a penalty of Rs
5000/ -"
so this section says end of relevant assessment year ,as
for previous year 2010- 11 , assessment year is 2011- 12 and
its end on 31. 03. 2012 ,means there is no liability for late
filing of income tax return up to 31. 03. 2012 and after that
assessing officer can impose a penalty of 5000, and that is
also his (AO) power which he may or may not exercise after
giving due hearing to the assessee.
Now you would like to know why people are so much
worried about the due date ,the reason is that as due date
has been linked with various other section of the income tax
act ,so it is significant in that manner .
so I have listed few impacts of late filing of the Income tax
return and issues related to due date of income tax .
Impact of late filing of Income tax return &
issue related to due date ( The List is
not exhaustive )
1. Interest u/ s 234 A :If there is tax due after deducting
advance tax ,TDS and self assessment tax than interest will
be applicable @1 % per month and part thereof up to the
date of filing of the return besides interest applicable u /s
234B or 234C .Means this interest is applicable only if there
is any tax payable in your return .( calculator online is
available here )
2. Loss of Interest on refund: You may loose interest on
refund u /s 244 A as delay in filing is attributable to assessee
for the period by which you have filed late return .
3. Audit Report :Person who are liable to get their accounts
audited should get the audit report on or before the due
date of filing return i.e 30. 09. 2011. Audit repot is only to be
prepared and not to be filed any where. In simple word or
boldly we can say that if audit report has been signed before
30. 09 .2011 that is enough, you can file return late and
report particulars will be filled when ever you filed your
income tax return .This is as income tax circular no 5 /2007
point no 6 (read full circular)
4. Revised return :Late /belated return can not be
revised .
5. Some of deduction under subsection 80 are not
available for late return.
6. Due date of income tax return is related to TDS deposite and
disallowance u /s 40 a( ia).
7. Due date of Income Tax return is related to tax saving u /s
54, 54 B,54 F and some other issues in capital gain saving
account deposit scheme.
8. Not able to carry forward the losses under various
heads :you are not able to carry forward following type of
losses if file return after due date
Speculation loss
business loss excluding loss due to unabsorbed depreciation
and capital exp on scientific research
short term capital loss
long term capital loss
loss due to owning and maint. of horse races
However there is no impact on following type of losses
even if return is furnished after the due date
loss from house property
business loss on account of unabsorbed depreciation and
capital expenditure on scientific research.
(though delay can be condoned as per circular 8/ 2001 DT
16. 5 .2001 on fulfilling of certain condition)
so if you are falls under the ambit of the above points then
you should furnish your return up to 31 .07 .2011 or
30. 09 .2011 as the case may be without any penalty.
Person who can afford to file late return
If you have
already deposited due tax or due taxes has been deducted
by your employer and nothing is due or
you are not claiming a Major amount as refund or
you have no losses to be carried forward
then you can fill return up to the end of the assessment year
ie 31 .03 .2012 without any penalty.
Person who should file return on time.
If you have
balance tax to be deposited or short fall of tax or
huge amount of refund due to you or
you have losses to be carried forwarded as explained above
then rush to the department asap so that return can be filled
on time.
NOTE:Friends the all things as explained above is to not
encourage people to file voluntarily late return but only
to inform taxpayers their liability so that they can take
informed decision.