- CA. Deepanshu Soni
Finance bill 2022 has introduced a new section 139(8a) and 140(b) which provides the assessee an opportunity to correct any errors or omissions through the filing of an updated return within two years from the end of the relevant assessment year along with the payment of additional tax and interest if any.
The sole objective of introducing this section is to reduce litigations and compliance in the income tax. Currently, the revised return can be filed within 9 months from the end of a financial year, after that the assessee does not have any option to correct the mistakes, errors, or omissions that may have been made in the original ITR unintentionally.
It leads to unnecessary litigations on the part of the IT department and assessee just because the assessee did not have any option to go through any other route to rectify the return. To cater to this problem section 139(8a) and 140b was introduced through finance bill 2022.
Let us look at what sections 139(8a) and 140b say and analyse the same:
Any person, whether or not he has furnished a return under section 139 (1)/(4)/(5), for an assessment year, (herein referred to as the relevant assessment year), may furnish an updated return for the previous year relevant to such assessment year, in the form as may be prescribed, at any time within twenty-four months from the end of the relevant assessment year.
For example, if anyone wants to file an updated return for FY 2021-22, he can file the same by 31st March 2025 i.e., within 24 months from AY 2022-23.
Provided that the provision of this subsection shall not apply if:
The updated return is a return of a loss; or
The Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976
The Prohibition of Benami Property Transactions Act, 1988
The Prevention of Money-laundering Act, 2002
The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015
and the same has been communicated to him, prior to the date of furnishing of return under this subsection; or
Where no return of income under section 139(1)/(4) has been furnished by an assessee and tax is payable, on the basis of a return to be furnished by such assessee under section 139(8a), after taking into account the tax already been paid by the assessee in form of TDS, Self-assessment tax, Advance tax, relief under section 89/90/91 and any other tax credits.
In such case, the assessee shall be liable to pay such tax together with interest and fee payable, and additional tax under any of the provisions of this act before furnishing the return and the return shall be accompanied by proof of payment of such tax, additional income tax, interest, and fee.
Additional Tax amount to be calculated as below: