Bombay HC Grants Big Relief To Taxpayers, Belated ITR Filing Deadline To Be Extended To January 15

Last Updated:December 23, 2024, 10:25 IST

Belated ITR Due Date: The directive came in response to a PIL citing issues arising from procedural changes in the ITR utility.

Belated ITR Due Date: In a key decision, the Bombay High Court has directed the Central Board of Direct Taxes (CBDT) to extend the deadline for filing belated and revised Income Tax Returns (ITR) for Assessment Year (A.Y.) 2024-25 from December 31, 2024, to at least January 15, 2025. The directive came in response to a Public Interest Litigation (PIL) filed by the Chamber of Tax Consultants, citing issues arising from procedural changes in the ITR utility.

PIL Filed Over Section 87A Rebate Denial

The PIL challenged the denial of the Section 87A rebate under the new tax regime due to changes in the utility software used for filing returns. The plea highlighted that a software update rolled out on July 5, 2024, arbitrarily disabled taxpayers from claiming the rebate under Section 87A of the Income Tax Act, 1961.

The court observed that the Section 87A rebate, which provides significant relief to taxpayers based on their total income, is a substantive right and cannot be denied because of procedural or technological modifications.

Section 87A Rebate

Section 87A of the Income Tax Act offers a rebate of up to Rs 25,000 under the new tax regime and Rs 12,500 under the old tax regime to individual taxpayers with a total taxable income of up to Rs 7 lakh and Rs 5 lakh respectively. This rebate effectively reduces the tax liability to zero for many taxpayers.

Belated and Revised Returns Deadline

Under current regulations, the final date for filing belated and revised returns for A.Y. 2024-25 is December 31, 2024. A belated return is filed under Section 139(4) of the Income Tax Act if the original filing deadline is missed. Taxpayers submitting belated returns are required to pay a penalty of Rs 5,000, which is reduced to Rs 1,000 for those with taxable income below Rs 5 lakh. No penalty applies if the income falls within the basic exemption limit of Rs 3 lakh.

Impact of Missing the Deadline

Failing to file a belated return by the prescribed deadline can lead to the loss of claims for refunds, deductions, or tax credits for the assessment year. After the deadline, taxpayers can only file an updated return, which is subject to additional conditions, including potential tax liabilities.

The court’s directive to extend the deadline aims to provide relief to taxpayers who faced procedural hurdles, ensuring they do not lose out on benefits due to technical delays. It also safeguards taxpayers from higher interest and penalties that may result from delayed filings.

What This Means for Taxpayers?

The extension provides additional time for individuals to file belated and revised returns without the risk of losing critical claims or facing penalties. Taxpayers are encouraged to make use of the extended timeline to comply with filing obligations and address any software-related challenges.

How To File A Belated Return For AY 2024-25?

• Visit the Portal: Go to the Income Tax Department’s official e-filing portal.
• Login/Register: Use your PAN as the User ID to log in or register.
• Select the ITR Form: Choose the appropriate form based on your income sources.
• Assessment Year: Ensure you select AY 2024-25 (for FY 2023-24).
• Fill in Details: Enter your income, and deductions, and calculate tax payable.
• Pay Tax: Clear any outstanding dues along with applicable penalties and interest.
• Submit and Verify: Submit the return online and complete the verification process.