802. Returns of income below taxable limit - Whether such returns are to be accepted at the receipt counters
Circular No. 493 was issued by the Central Board of Direct Taxes on 21 August 1987. Its subject is 802. Returns of income below taxable limit - Whether such returns are to be accepted at the receipt counters.
Directs that returns of income below the taxable limit are not to be received at the receipt counters at all, unless they fall within an exception in the proviso to section 139(10). Following Instruction Nos. 1744 dated 21-1-1987 and 1765 dated 25-6-1987, which had said such returns were not to be acted upon, the Board found that practice varied - some charges refused them, others took them in, entered them in registers and then treated them as non est. It points out that the prescribed return forms carry specific columns showing whether a return falls within the proviso, giving columns (iii), (iv), (v) and (vi) of Form No. 2 as corresponding to clauses (a), (e), (b) and (f) of the proviso, so a counter clerk can tell a valid return from an invalid one. All returns in Form No. 3A are to be accepted as falling within an exception, and all Form No. 1 returns, being company returns, are to be accepted.
To secure uniformity of procedure, after the Board was told that charges were handling below-taxable-limit returns differently and taxpayers' associations and Commissioners had sought clarification.
802. Returns of income below taxable limit - Whether such returns are to be accepted at the receipt counters
1. Attention is invited to Instruction Nos. 1744 dated 21-1-1987 and 1765 dated 25-6-1987 in which Board have clarified that returns of income for the assessment year 1986-87 and subsequent years which are below taxable limit, should not be acted upon unless covered under the exceptions contained in the proviso to sub-section (10) of section 139. The Board, vide para 2(i) of Instruction No. 1744 dated 21-1-1987, desired that suitable instructions may be issued by the Commissioners of Income-tax in this regard.
2. It has been brought to the notice of the Board that no uniform practice is followed regarding receipt of such returns at the receipt counters. While in some charges instructions have been issued by the Commissioners not to accept such returns unless covered by the exceptions, in many charges the returns are being accepted, entered into registers and then treated as ‘non est’. Clarifications have also been sought by taxpayers’ associations and Commissioners of Income-tax on this issue.
3. The matter has, therefore, been examined by the Board with a view to having uniformity of procedure. In this background, I am directed to draw your attention to the forms of returns of income prescribed under the Rules and to say that there are specific columns in the return forms clearly indicating whether the return falls under any of the exceptions contained in the proviso to section 139(10) or not. For instances, columns (iii ), (iv), (v) and (vi ), Form No. 2 correspond to the exceptions contained in clauses (a), (e), (b ) and (f) of the proviso respectively. Similarly, there are columns in all the other return forms from which the official receiving returns can ascertain whether a return which is below taxable limit falls under one of the exempted categories and is to be accepted.
4. It may be noted that all the returns filed in Form No. 3A have to be accepted as these fall under one of the exceptions contained in the said proviso. Similarly, all returns filed in Form No. 1 which pertain to companies are to be accepted. Though there is no column in the return forms to indicate that a return has been filed under section 139(2), such returns can also be identified at the receipt counters as these are normally accompanied by a covering letter or otherwise it is indicated on the return form itself by the assessee.
5. In view of these facts, identification of valid returns can be made even at the receipts counters. Therefore, returns which are not valid should not be accepted at the receipt counters. You [All Chief Commissioners and Commissioners of Income-tax] may kindly issue necessary instructions to the officers and staff working under you that the returns of income below taxable limit barring those covered under the exceptions contained in the proviso to section 139(10) are not to be received at the counter.
Circular : No. 493 [F. No. 201/64/86-IT(A-III)], dated 21-8-1987.
In old disputes about whether a return was validly filed for a year, and where a below-taxable-limit return was refused at the counter or treated as non est.
Forms it names. Form No. 1, Form No. 2, Form No. 3A
Source: the Income Tax Department’s own published text — its page for this instrument.