Government takes big decision about Income Tax Exemption.

EPFO Latest News: Income Tax exemption! Modi government takes big decision - Check what it is and how it will impact you

In a major development,  Modi government on Tuesday raised the deposit threshold limit to Rs 5 lakh per annum in provident fund for which interest would continue to be tax exempt. This would be applicable to those cases where no contribution is made by employers to the retirement fund.

In her Budget presented to Parliament on February 1, Finance Minister Nirmala Sitharaman had provided that interest on employee contributions to provident fund over Rs 2.5 lakh per annum would be taxed from April 1, 2021.

Replying to the debate on the Finance Bill 2021 in the Lok Sabha, Sitharaman made the announcement regarding raising the limit to Rs 5 lakh in cases where employers do not make contributions to the provident fund.

The Finance Bill, which gives effect to tax proposals for 2021-22, was approved by voice vote. The bill was passed after acceptance of 127 amendments to the proposed legislation.

The minister also stressed that tax on interest on provident fund contribution affects only 1 per cent of the contributors, and the remaining are not impacted as their contribution is less than Rs 2.5 lakh per annum.

Referring to the issues raised by various members on higher taxes on motor fuel, Sitharaman said she would love to discuss the issue of bringing petrol and diesel under GST in the next GST Council meeting. She also sought to remind members that it was not just the Centre which taxes motor fuel and states too impose levies.

The finance minister also said rationalisation of customs duty structure will be undertaken to help domestic businesses, especially the MSME segment. On taxes, she emphasised on the need for widening the tax base. With regards to the equalisation levy, she said this is meant to provide a level playing field to domestic businesses which pay taxes in India.

Source: ZeeBusiness

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Filing of Revised Income Tax Returns by the Tax Payers Post De-Monetisation of Currency

Government of India

Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

New Delhi, 14 December, 2016.

PRESS RELEASE

Sub: Filing of Revised Income Tax Returns by the Tax Payers Post De-Monetisation of Currency

Under the existing provisions of section 139(5) of the Income-tax Act, 1961 (‘Act’), Revised Return can only be filed if any person, who has filed a return under section 139(1) of the Act or in response to notice u/s 142(1), discovers any omission or any wrong statement therein. Post demonetization of the currency on 8th November, 2016, some taxpayers may misuse this provision to revise the return-ofincome filed by them for the earlier assessment year, for manipulating the figures of income, cash-in-hand, profits etc. with an intention to show the current year’s undisclosed income (including the unaccounted income held in the form of demonetized currency in current year) in the earlier return.

It is hereby clarified that the provision to file a revised return of income u/s 139(5) of the Act has been stipulated for revising any omission or wrong statement made in the original return of income and not for resorting to make changes in the income initially declared so as to drastically alter the form, substance and quantum of the earlier disclosed income.

It is brought to the notice of tax payers that any instance coming to the notice of Income-tax Department which reflects manipulation in the amount of income, cash-in-hand, profits etc. and fudging of accounts may necessitate scrutiny of such cases so as to ascertain the correct income of the year and may also attract penalty/prosecution in appropriate cases as per provision of law.

(Meenakshi J.Goswami)

Commissioner of Income Tax

(Media and Technical Policy)

Official Spokesperson, CBDT.

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Complete procedure of online bulk income tax return filing.

The online bulk e-return of Income Tax filing process is very simple even also Bulk PAN validation, Bulk PAN application, Bulk TDS return, Bulk ITR V Request, Bulk PAN/TAN Request, Bulk Digital Signature etc. also by using e-Return Intermediary (ERI) User Registration.  The filing of ITR forms with the relevant Income Tax Authorities. We can e-file the tax returns on request as well.

The ERI Registration Number is available only for Companies and Firms but it is non-mandatory. If the registering ERI Admin belongs to company/firm category, Date of Incorporation is mandatory.

e-Return Intermediary (ERI) User Features :

Pre-requisites:

• ERI Admin should be registered in e-Filing application.
• ERI Sub-user must be created and activated by ERI Admin.

To read more details for Online Bulk Income Tax Return Filing Click Here.

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If Cash Deposit mismatch as Declared Income would attract 90% Tax & Penalty - FM

Any mismatch between cash deposited and declared income would attract 90% tax & penalty: FinMin

The Govt. has decided to discontinue the legal tender character of high denomination bank notes of Rs 500 and Rs 1000. In other words, such notes will not be a legal tenders from midnight of November 8, 2016. This decision is being taken to curb financing of terrorism through the proceeds of Fake Indian Currency Notes and for eliminating Black Money.

The restriction has been placed on withdrawal and exchange of old currency notes but there is no limit on deposit of cash into bank account. However, people should refrain from depositing cash into their bank account if they are unable to explain source of such deposit. If the income is not explained they will have to pay penalty.

The income-tax department will check for mismatch of cash deposited by people with the income disclosed by them in their return of income. Any mismatch between deposited sum and declared income would attract 30% tax and 200% of tax liability as penalty, said Revenue Secretary, HasmukhAdia.

"We would be getting reports of all cash deposited during 10th November to 30th December, 2016 above threshold of Rs 2.5 lakhs in each account", Revenue Secretary, HasmukhAdhia Tweeted.

He further said that businessmen, housewives and workers need not to worry about small deposit of old currency up to Rs 1.5 lacs or Rs 2 lacs. Since it would be below the taxable limit. There will be no harassment by Income Tax department for such small deposits made.

This ban will impact the black money hoarders as now their existing bank notes will be a worthless pieces of paper.

Source: Taxmann

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Short Notes on Tax Free Income - Section-wise for all Taxpayee - Free Download

As per the Finance (No.2) Act, 2014,  Income Tax Free Income level is very high.  Apart from this we all known that Income is payable on all types of Incomes earned by Taxpayee in India even-though, there are some exceptions to avoid this rule and some Incomes have been specially exemption from Income Tax.  Such Income is referred to as Income Tax Free Income.  The most popular Tax Free Income is namely :-

• Agricultural Income (Section 10(1)).
• Amount received by a member of the HUF from the income of the HUF, or in case of impartible estate out of income of family estate [Section 10(2)]
• Share of profit received by a partner from the firm [Section 10(2A)]
• Certain interest to non-residents [Section 10(4)]
• Interest on notified savings certificates [Section 10(4B)]
• Leave travel concession [Section 10(5)]
• Remuneration received by specified diplomats and their staff [Section 10(6)(ii)]
• Salary of a foreign employee and non-resident member of crew [Section 10(6)(vi),(viii)]
• Remuneration of a foreign trainee [Section 10(6)(xi)]
• Tax paid on behalf of foreign company deriving income by way of royalty or fees for technical services [Section 10(6A)]
• Tax paid on behalf of foreign company or non-resident in respect of other income [Section 10(6B)]
• Tax paid on behalf of foreign Government or foreign enterprise deriving income by way of lease of aircraft or aircraft engine [Section 10(6BB)]
• Technical fees received by a notified foreign company [Section 10(6C)]
• Allowance/perquisites to Government employee outside India [Section 10(7)]
• Income of foreign Government employee under co-operative technical assistance programme [Section 10(8)]
• Remuneration or fees received by a non-resident consultant/its foreign employees [Section 10(8A),(8B)]
• Income of a family member of an employee serving under co-operative technical assistance programme [Section 10(9)]
• Death-cum-retirement gratuity received by Government servants [Section 10(10)(i)]
• Gratuity received by a non-Government employee covered by Payment of Gratuity Act, 1972 [Section 10(10)(ii)]
• Gratuity received by a non-Government employee not covered by Payment of Gratuity Act, 1972 [Section 10(10)(iii)]
• Pension [Section 10(10A)]
• Leave salary [Section 10(10AA)]
• Retrenchment compensation [Section 10(10B)]
• Compensation for Bhopal Gas Leak Disaster [Section 10(10BB)]
• Compensation on account of any disaster [Section 10(10BC)]
• Payment at the time of voluntary retirement [Section 10(10C)]
• Tax on perquisites paid by the employer [Section 10(10CC)]
• Amount paid on life insurance policy [Section 10(10D)]
• Exemption in respect of amount received from public provident fund/statutory provident fund/recognised provident fund/un-recognised provident fund [Section 10(11)/(12)]
• Payment from approved superannuation fund in specified circumstances and subject to certain limits [Section 10(13)]
• House rent allowance [Section 10(13A)] 
• Prescribed allowances or benefits [Section 10(14)]
• Interest on securities [Section 10(15)]
• Lease rent of an aircraft [Section 10(15A)]
• Educational scholarship [Section 10(16)]
• Daily allowance to a Member of Parliament [Section 10(17)]
• Awards [Section 10(17A)]
• Pension to gallantry award winner [Section 10(18)]
• Family pension received by the family members of armed forces [Section 10(19)]
• Annual value of one palace [Section 10(19A)]
• Income of local authority [Section 10(20)]
• Income of research association [Section 10(21)]
• Income of a news agency [Section 10(22B)]
• Income of a professional association [Section 10(23A)]
• Income received on behalf of Regimental Fund [Section 10(23AA)]
• Income of a fund established for welfare of employees [Section 10(23AAA)]
• Income of pension fund [Section 10(23AAB)]
• Income from Khadi or village industry [Section 10(23B)]
• Income of Khadi and Village Industries Boards [Section 10(23BB)] 
• Incomes of statutory bodies for the administration of public charitable trust [Section 10(23BBA)] 
• Income of European Economic Community [Section 10(23BBB)]
• Income of SAARC fund [Section 10(23BBC)]
• Income of Secretariat of Asian Organisation of Supreme Audit Institutions [Section 10(23BBD)]
• Income of Insurance Regulatory and Development Authority [Section 10(23BBE)]
• Income of North - Eastern Development Financial Corporation Limited [Section 10(23BBF)]
• Income of Central Electricity Regulatory Commission [Section 10(23BBG)] 
• Income of the Prasar Bharati [Section 10(23BBH)]
• Income of certain national funds [Section 10(23C)(i)/(ii)/(iii)]
• Income of National Foundation for Communal Harmony [Section 10(23C)(iiia)], Section 10(23C)(iiiad), Section 10(23C)(vi)
• Income of Hospital [Section 10(23C)(iiiac)/(iiiae)/(via)]
• Income of Charitable Institution or Fund [Section 10(23C)(iv)]
• Income of religious/charitable trust [Section 10(23C)(v)]
• Income of mutual fund [Section 10(23D)]
• Income of a securitisation trust [Section 10(23DA)]
• Income of notified investor protection fund [Section 10(23EA)]
• Income of Credit Guarantee Fund Trust [Section 10(23EB)]
• Income of the notified investor protection fund set - up by commodity exchange [Section 10(23EC)]
• Income of Investor Protection Fund set by a depository [Section 10(23ED)]
• Income of a venture capital fund or a venture capital company from investment in a venture capital undertaking [Section 10(23FB)]
• Income of a of a Business Trust [Section 10(23FC)]
• Distributed Income of a Unit Holder from the Business Trust [Section 10(23FD)]
• Income of a registered trade union [Section 10(24)]
• Income of provident fund [Section 10(25)]
• Income of the Employees’ State Insurance Fund [Section 10(25A)]
• Income of a member of a Scheduled Tribe [Section 10(26)]
• Income of a “Sikkimese” individual [Section 10(26AAA)]
• Income of an Agricultural Produce Marketing Committee/Board [Section 10(26AAB)]
• Income of corporation or other body or institution or association established for promoting the interest of members of Scheduled Caste, etc. [Section 10(26B)]
• Income of corporation established for promoting interest of minority caste [Section 10(26BB)]
• Income of corporation established for ex-servicemen [Section 10(26BBB)]
• Income of a co-operative society formed for promoting the interests of the members of Scheduled Castes or Scheduled Tribes [Section 10(27)]
• Income of coffee board, rubber board, etc. [Section 10(29A)]
• Subsidy from the Tea Board [Section 10(30)]
• Income of minor [Section 10(32)]
• Capital gains on transfer of US 64 [Section 10(33)]
• Dividends and interest on units [Section 10(34)/(35)]
• Income of a shareholder on account of buy back of shares by the company [Section 10(34A)]
• Income of an investor received from a securitisation trust [Section 10(35A)]
• Capital gains in case of compulsory acquisition of urban agricultural land [Section 10(37)]
• Long - term capital gains on transfer of equity shares or units of an equity oriented mutual fund or a unit of a business trust covered by securities transaction tax [Section 10(38)]
• Income from international sporting event [Section 10(39)]
• Grants received by specified subsidiary company [Section 10(40)]
• Income of certain non - profit body or authority [Section 10(42)]
• Loan in the case of reverse mortgage [Section 10(43)]
• Income of New Pension System Trust [Section 10(44)]
• Any notified allowance or perquisite paid to the Chairman/retired Chairman or any other member/retired member of the UPSC [Section 10(45)]
• Exemption of specified income of notified body/ authority/trust/board/commission [Section 10(46)]
• Any income of a notified infrastructure debt fund set-up in accordance with prescribed guidelines [Section 10(47)]
• Income received by certain foreign companies in Indian currency for import of crude oil etc. [Section 10(48)]
• Tax exemption to National Financial Holdings Company Limited [Section 10(49)]

Other important exemptions 

Apart from above discussed exemption of section 10 following is the list of other important exemptions:

• Section 10A provides for exemption in respect of income of newly established undertakings in free trade zone or electronic hardware technology park or electronic software technology park.
• Section 10AA provides for exemption in respect of income of newly established units in Special Economic Zones. 
• Section 11 and 12 provide exemption in respect of income of a public charitable or religious trust.
• Section 13A provides exemption in respect of income of a political party.
• Section 13B provides exemption in respect of income of an electoral trust. 

FREE DOWNLOAD SHORT NOTES (CLICK HERE)

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Maturity along with Bonus of LIC receipts are taxable or non-taxable.

As per section 10(10D), any amount received under a life insurance policy, including bonus is exempt from tax. However, following receipts would be subject to tax:

• Any sum received under sub-section (3) of section 80DD; or
• Any sum received under Keyman insurance policy; or
• Any sum received in respect of policies issued on or after April 1st, 2003, in respect of which the amount of premium paid on such policy in any financial year exceeds 20% (10% in respect of policy taken on or after 1st April, 2012) of the actual capital sum assured; or
• Any sum received for insurance on life of *specified person (issued on or after April 1st 2013) in respect of which the amount of premium exceeds 15% of the actual capital sum assured.

Any person who is –

1. A person with disability or severe disability specified under section 80U​; or
2. suffering from disease or ailment  as specified in the rule made under section 80DDB.

Following points should be noted in this regard:

• Exemption is available only in respect of amount received from life insurance policy.
• Exemption under section 10(10D)​ is unconditionally available in respect of sum received for a policy which is issued on or before March 31, 2003.

Amount received on the death of the person will continue to be exempt without any condition.​

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Due Date for TDS Return Filing Quarter-I for Fin.Year 2015-16 and Fees & Penalty thereon.

The Last date of TDS Return filing for Quarter 1 of Fin. Year 2015-16 is 15th July, 2015. After that your TDS Return comes under Late Filing. In that case you may punishable as Fees and Penalty for Late Filing of TDS Returns.  Therefore dont delayed filing of TDS Returns for Fin. Year 2015-16.  The details for Quarter-I Procedure are as under:

With the introduction of Section 234E, there is now a provision of stringent penalties for delayed filing of TDS returns.

• Failure to submit e-TDS Statement on time will result in fees on the deductor.
• If you delay or forget to file your e-TDS Statement, fees of Rs. 200 per day will be levied on the deductor, as long as TDS Statement is not filed.
• The levied amount of fee is not supposed to exceed the TDS deductibles.
• Prior to filing of TDS Statement such fee should be paid and it should be reflected in the TDS Statement.

Fees and Penalty for Late Filing of TDS Returns of Fin. Year 2015-16 for Quarter-I are as follows:

Section 234E – Levy of Fees 

• Failure to submit e-TDS Statement on time will result in fees on the deductor.
• If you delay or forget to file your e-TDS Statement, fees of Rs. 200 per day will be levied on the deductor, as long as TDS Statement is not filed.
• The levied amount of fee is not supposed to exceed the TDS deductibles.
• Prior to filing of TDS Statement such fee should be paid and it should be reflected in the TDS Statement.

Section 271H – Penalty

• Deductor has to pay a penalty ranging from minimum of Rs. 10,000/- to One Lac rupees,
• If deductor exceeds one year time limit to File TDS Statement.
• If deductor furnishes incorrect details like PAN, TDS Amount, Payment of Challan etc.

Free Download TDS Software (Click Here)

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CBDT authorizes CIT(E) to act as prescribed authority u/s 10(23C) with effect from Nov 15, 2014

SECTION 10(23C)(vi)/(via) OF THE INCOME-TAX ACT, 1961 - EXEMPTIONS - UNIVERSITY/EDUCATIONAL INSTITUTIONS/HOSPITALS - PRESCRIBED AUTHORITY - SUPERSESSION OF NOTIFICATION NO. 76/2014[F.No. 153/41/2007-TPL]/SO 3027(E), DATED 1-12-2014

NOTIFICATION NO. 20/2015 [F.NO. 196/26/2014-ITA.I], DATED 5-3-2015

In pursuance of the provisions contained in sub-clauses (vi) and (via) of clause (23C) of section 10 of the Income-tax Act, 1961 (43 of 1961) read with rule 2CA of the Income-tax Rules, 1962, and in supersession of the notification of the Government of India in the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes, published in the Gazette of India, Extraordinary, Part-II, section 3, sub-section (ii), vide number S.O. 3027(E), dated the 1st December, 2014, except as respects things done or omitted to be done before such supersession, the Central Board of Direct Taxes hereby,—

(i)		specifies the 15th day of November, 2014 as the 'specified date' for the purposes of the aforesaid rule 2CA.
(ii)		authorises the Commissioner of Income-tax (Exemptions) to act as 'prescribed authority' for the purposes of sub-clause (vi) and sub-clause (via) of clause (23C) of section 10 of the Act with effect from the 15th day of November, 2014 :

Provided that in respect of application made before the 15th day of November, 2014 under sub-clause (vi) and sub-clause (via) of clause (23C) of section 10 before the prescribed authority [authorised by the Board by notification number S.O. 852 (E), dated 30th May, 2007, published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (ii)] and in respect of which any proceeding is pending, such authorised authorities shall continue to act as the prescribed authority subject to following modifications in view of the fact that some of such prescribed authorities have either been redesignated or have ceased to exist —

(i)		for cases falling in the jurisdiction of erstwhile Director of Income-tax (Exemption), Ahmedabad, [redesignated as Commissioner of Income-tax (Exemptions) with effect from the 15th day of November, 2014] the Chief Commissioner of Income-tax, Ahmedabad-1, Ahmedabad shall be the authority;
(ii)		for cases falling in the jurisdiction of erstwhile Director of Income-tax (Exemption), Bangalore, [redesignated as Commissioner of Income-tax (Exemptions) with effect from the 15th day of November, 2014] the Chief Commissioner of Income-tax, Bengaluru-1, Bengaluru shall be the authority;
(iii)		for cases falling in the jurisdiction of erstwhile Director of Income-tax (Exemption), Chennai, [redesignated as Commissioner of Income-tax (Exemptions) with effect from the 15th day of November, 2014] the Chief Commissioner of Income-tax, Chennai-3, Chennai shall be the authority;
(iv)		for cases falling in the jurisdiction of erstwhile Director of Income-tax (Exemption), Hyderabad, [redesignated as Commissioner of Income-tax (Exemptions) with effect from the 15th day of November, 2014] the Chief Commissioner of Income-tax, Hyderabad shall be the authority;
(v)		for cases falling in the jurisdiction of erstwhile Director of Income-tax (Exemption), Kolkata, [redesignated as Commissioner of Income-tax (Exemptions) with effect from the 15th day of November, 2014] the Chief Commissioner of Income-tax, Kolkata-3, Kolkata shall be the authority;
(vi)		for cases falling in the jurisdiction of erstwhile Director of Income-tax (Exemption), Mumbai, [redesignated as Commissioner of Income-tax (Exemptions) with effect from the 15th day of November, 2014] the Chief Commissioner of Income-tax, Mumbai-1, Mumbai shall be the authority;
(vii)		for cases falling in the jurisdiction of erstwhile Director of Income-tax (Exemptions), Delhi, [redesignated as Commissioner of Income-tax (Exemptions) with effect from the 15th day of November, 2014] the Chief Commissioner of Income-tax (Exemptions), Delhi shall be the authority;
(viii)		for cases other than those mentioned at (i) to (vii) above, the Chief Commissioner or Director General to whom the Assessing Officer having jurisdiction to assess the university or other educational institution or any hospital or other medical institution referred to in sub-clause (vi) and sub-clause (via) of clause (23C) of section 10 of the Act was subordinate prior to the 15th day of November, 2014 and where such Chief Commissioner or Director General who was so authorised has ceased to exist, the Principal Chief Commissioner of Income-tax of that region.

Source: www.taxmann.com

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Charges collected for late filing of TDS return is a fees and not a tax

The fee sought to be levied under section 234E for late filing of TDS return is not a tax that is sought to be levied on the deductor. If the section does not empower the AO to condone the delay for furnishing of TDS return, then the said section shall not stand onerous.

Facts of the case:

Petitioner, a practicing Chartered Accountant, challenged the constitutional validity of section 234E.

Section 234E – Levy of Fees:

Failure to submit e-TDS Statement on time will result in fees on the deductor.

If you delay or forget to file your e-TDS Statement, fees of Rs. 200 per day will be levied on the deductor, as long as TDS Statement is not filed.

The levied amount of fee is not supposed to exceed the TDS deductibles.

Prior to filing of TDS Statement such fee should be paid and it should be reflected in the TDS Statement.

The petitioner argued that legislature had categorically termed the levy under section 234E of the Act as a “fee”. It necessarily could be levied only in the event the Government was providing any service. In the absence thereof, the said section seeks to collect tax in the guise of a fee.

He further submitted that the provisions of section 234E were extremely onerous as the AO was not vested with any power to condone the delay in filing the TDS return and there was also no provision of appeal against order of AO.

It was held that:

The High Court held that the the Income Tax Department is under obligation to process the income tax returns within the specified period. If the information of TDS is not furnished by the deductor, the department cannot accurately process the return.

If the income tax returns having refund claims were not processed in a timely manner, it would result in delay in issuing refunds or raising of infructuous demands. Late payment of refund also affects the government financially as the Government has to pay interest for delay in granting the refunds.

To avoid such interest payment, furnishing of TDS returns within the prescribed time frame is necessary. The legislature viewed that the TDS return was not furnished within the due date. This led to an additional work burden upon the Department due to the fault of the deductor.  To compensate for the additional work burdened upon the Department, a fee was sought to be levied under section 234E. Thus, Section 234E is a fee which is charged for the extra service which the Department has to provide due to the late filing of the TDS statements.

Even if right of appeal is not there in the statute, the aggrieved person could anytime approach to the Court under Article 226/ 227 of the Constitution of India, as the case may be. Therefore, the Court held that merely because no remedy of appeal was provided for, the provisions of section 234E were onerous.

Source: Mr. Alok Patnia, founder of Taxmantra.com

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Download Short Notes on Tax Free Income Section-wise for all Taxpayee as amended in Finance (No.2) Act, 2014 for Asstt. Year 2015-16.

The Finance (No.2) Act, 2014 has been recently amendment by the Government (CBDT) and as per these amendments the Income Tax Free Income level is very high.  Apart from this we all known that Income is payable on all types of Incomes earned by Taxpayee in India even-though, there are some exceptions to avoid this rule and some Incomes have been specially exemption from Income Tax.  Such Income is referred to as Income Tax Free Income.  The most popular Tax Free Income is namely :-

• Agricultural Income (Section 10(1)).
• Amount received by a member of the HUF from the income of the HUF, or in case of impartible estate out of income of family estate [Section 10(2)]
• Share of profit received by a partner from the firm [Section 10(2A)]
• Certain interest to non-residents [Section 10(4)]
• Interest on notified savings certificates [Section 10(4B)]
• Leave travel concession [Section 10(5)]
• Remuneration received by specified diplomats and their staff [Section 10(6)(ii)]
• Salary of a foreign employee and non-resident member of crew [Section 10(6)(vi),(viii)]
• Remuneration of a foreign trainee [Section 10(6)(xi)]
• Tax paid on behalf of foreign company deriving income by way of royalty or fees for technical services [Section 10(6A)]
• Tax paid on behalf of foreign company or non-resident in respect of other income [Section 10(6B)]
• Tax paid on behalf of foreign Government or foreign enterprise deriving income by way of lease of aircraft or aircraft engine [Section 10(6BB)]
• Technical fees received by a notified foreign company [Section 10(6C)]
• Allowance/perquisites to Government employee outside India [Section 10(7)]
• Income of foreign Government employee under co-operative technical assistance programme [Section 10(8)]
• Remuneration or fees received by a non-resident consultant/its foreign employees [Section 10(8A),(8B)]
• Income of a family member of an employee serving under co-operative technical assistance programme [Section 10(9)]
• Death-cum-retirement gratuity received by Government servants [Section 10(10)(i)]
• Gratuity received by a non-Government employee covered by Payment of Gratuity Act, 1972 [Section 10(10)(ii)]
• Gratuity received by a non-Government employee not covered by Payment of Gratuity Act, 1972 [Section 10(10)(iii)]
• Pension [Section 10(10A)]
• Leave salary [Section 10(10AA)]
• Retrenchment compensation [Section 10(10B)]
• Compensation for Bhopal Gas Leak Disaster [Section 10(10BB)]
• Compensation on account of any disaster [Section 10(10BC)]
• Payment at the time of voluntary retirement [Section 10(10C)]
• Tax on perquisites paid by the employer [Section 10(10CC)]
• Amount paid on life insurance policy [Section 10(10D)]
• Exemption in respect of amount received from public provident fund/statutory provident fund/recognised provident fund/un-recognised provident fund [Section 10(11)/(12)]
• Payment from approved superannuation fund in specified circumstances and subject to certain limits [Section 10(13)]
• House rent allowance [Section 10(13A)] 
• Prescribed allowances or benefits [Section 10(14)]
• Interest on securities [Section 10(15)]
• Lease rent of an aircraft [Section 10(15A)]
• Educational scholarship [Section 10(16)]
• Daily allowance to a Member of Parliament [Section 10(17)]
• Awards [Section 10(17A)]
• Pension to gallantry award winner [Section 10(18)]
• Family pension received by the family members of armed forces [Section 10(19)]
• Annual value of one palace [Section 10(19A)]
• Income of local authority [Section 10(20)]
• Income of research association [Section 10(21)]
• Income of a news agency [Section 10(22B)]
• Income of a professional association [Section 10(23A)]
• Income received on behalf of Regimental Fund [Section 10(23AA)]
• Income of a fund established for welfare of employees [Section 10(23AAA)]
• Income of pension fund [Section 10(23AAB)]
• Income from Khadi or village industry [Section 10(23B)]
• Income of Khadi and Village Industries Boards [Section 10(23BB)] 
• Incomes of statutory bodies for the administration of public charitable trust [Section 10(23BBA)] 
• Income of European Economic Community [Section 10(23BBB)]
• Income of SAARC fund [Section 10(23BBC)]
• Income of Secretariat of Asian Organisation of Supreme Audit Institutions [Section 10(23BBD)]
• Income of Insurance Regulatory and Development Authority [Section 10(23BBE)]
• Income of North - Eastern Development Financial Corporation Limited [Section 10(23BBF)]
• Income of Central Electricity Regulatory Commission [Section 10(23BBG)] 
• Income of the Prasar Bharati [Section 10(23BBH)]
• Income of certain national funds [Section 10(23C)(i)/(ii)/(iii)]
• Income of National Foundation for Communal Harmony [Section 10(23C)(iiia)], Section 10(23C)(iiiad), Section 10(23C)(vi)
• Income of Hospital [Section 10(23C)(iiiac)/(iiiae)/(via)]
• Income of Charitable Institution or Fund [Section 10(23C)(iv)]
• Income of religious/charitable trust [Section 10(23C)(v)]
• Income of mutual fund [Section 10(23D)]
• Income of a securitisation trust [Section 10(23DA)]
• Income of notified investor protection fund [Section 10(23EA)]
• Income of Credit Guarantee Fund Trust [Section 10(23EB)]
• Income of the notified investor protection fund set - up by commodity exchange [Section 10(23EC)]
• Income of Investor Protection Fund set by a depository [Section 10(23ED)]
• Income of a venture capital fund or a venture capital company from investment in a venture capital undertaking [Section 10(23FB)]
• Income of a of a Business Trust [Section 10(23FC)]
• Distributed Income of a Unit Holder from the Business Trust [Section 10(23FD)]
• Income of a registered trade union [Section 10(24)]
• Income of provident fund [Section 10(25)]
• Income of the Employees’ State Insurance Fund [Section 10(25A)]
• Income of a member of a Scheduled Tribe [Section 10(26)]
• Income of a “Sikkimese” individual [Section 10(26AAA)]
• Income of an Agricultural Produce Marketing Committee/Board [Section 10(26AAB)]
• Income of corporation or other body or institution or association established for promoting the interest of members of Scheduled Caste, etc. [Section 10(26B)]
• Income of corporation established for promoting interest of minority caste [Section 10(26BB)]
• Income of corporation established for ex-servicemen [Section 10(26BBB)]
• Income of a co-operative society formed for promoting the interests of the members of Scheduled Castes or Scheduled Tribes [Section 10(27)]
• Income of coffee board, rubber board, etc. [Section 10(29A)]
• Subsidy from the Tea Board [Section 10(30)]
• Income of minor [Section 10(32)]
• Capital gains on transfer of US 64 [Section 10(33)]
• Dividends and interest on units [Section 10(34)/(35)]
• Income of a shareholder on account of buy back of shares by the company [Section 10(34A)]
• Income of an investor received from a securitisation trust [Section 10(35A)]
• Capital gains in case of compulsory acquisition of urban agricultural land [Section 10(37)]
• Long - term capital gains on transfer of equity shares or units of an equity oriented mutual fund or a unit of a business trust covered by securities transaction tax [Section 10(38)]
• Income from international sporting event [Section 10(39)]
• Grants received by specified subsidiary company [Section 10(40)]
• Income of certain non - profit body or authority [Section 10(42)]
• Loan in the case of reverse mortgage [Section 10(43)]
• Income of New Pension System Trust [Section 10(44)]
• Any notified allowance or perquisite paid to the Chairman/retired Chairman or any other member/retired member of the UPSC [Section 10(45)]
• Exemption of specified income of notified body/ authority/trust/board/commission [Section 10(46)]
• Any income of a notified infrastructure debt fund set-up in accordance with prescribed guidelines [Section 10(47)]
• Income received by certain foreign companies in Indian currency for import of crude oil etc. [Section 10(48)]
• Tax exemption to National Financial Holdings Company Limited [Section 10(49)]

Other important exemptions 

Apart from above discussed exemption of section 10 following is the list of other important exemptions:

• Section 10A provides for exemption in respect of income of newly established undertakings in free trade zone or electronic hardware technology park or electronic software technology park.
• Section 10AA provides for exemption in respect of income of newly established units in Special Economic Zones. 
• Section 11 and 12 provide exemption in respect of income of a public charitable or religious trust.
• Section 13A provides exemption in respect of income of a political party.
• Section 13B provides exemption in respect of income of an electoral trust. 

FREE DOWNLOAD SHORT NOTES (CLICK HERE)

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Interest u/s. 234B can't be charged on some Dis-allownaces by A.O.

Assessing Officer has not any right to charge interest u/s. 234B on non deduction of TDS u/s. 194C, 194A, 194H, 194I, 194J and 195.

The dis-allowance on account of non deduction of tax at source is now very common form of dis-allowance by the assessing officer. Such dis-allowance is done u/s 40(a)(i) and 40(a)(ia)  of the Income Tax Act. Very common dis-allowances for non deductions of tax at source  are as under :

• Non deduction on contractual works (Section 194C )
• Non deduction of tax on interest (194A)
• Non deduction of tax on commission (194H)
• Non deduction of tax on rent  (194 I)
• Non deduction of tax on professional and technical fee (194J)
• Non deduction of tax on payments to Non Residents.(195)

The Assessing Officer (A.O.) computes on increased total income and charges interest u/s 234B. Thus, interest u/s 234B is charged also on the tax on dis-allowance u/s 40(a)(i) which is included in total income.

Source: www.taxbymanish.blogspot.com

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Basic Tax Exemption Limit for Salaried Employee for Asstt. Year 2015-16

Basic exemption limit to be increased from Rs. 2 lakhs to Rs. 2.5 lakhs for an individual below the age of 60 years and from Rs. 2.5 lakhs to Rs. 3 lakhs ,in case of an individual who is of age of 60 years or above, but below the age of 80 years.

The existing limit of deduction under section 80C to be increased from Rs. 1 lakh to Rs. 1.5 lakhs. The annual ceiling limit for investment in Public Provident Fund to be increased from Rs. 1 lakh to Rs. 1.5 lakh.

The deduction in respect of interest on housing loan borrowed for acquisition or construction of self occupied house property to be enhanced from Rs. 1.5 lakhs to Rs. 2 lakhs.

No change proposed in the income tax rate,surcharge and education cess.

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Budget 2015-16 - 3-year Bank FDs may get Tax Exemption

MUMBAI: The government may consider the demand of banks to make fixed deposits for three years and more tax-free instead of the five-year lock-in period at present, providing these lenders a level-playing field with mutual funds and tax-free bonds that have been weaning away a large chunk of investors.

Indicating this possibility, officials said bank executives and heads of financial institutions also requested finance minister Arun Jaitley in a pre-budget meeting to consider separate tax slabs for corporate entities on the lines of different tax slabs for individuals.

"The view from the pre-budget meeting is that FDs of lower maturity should be considered for tax benefits," said a person present in the meeting.

Bankers say this will discourage people from opting for other instruments like mutual funds, which have a lock-in period of three years. The terms of schemes eligible for tax rebate under Section 80 C are not uniform; while public provident fund has a lock-in period of 15 years, it is six years in the case of national savings certificate and three years in equitylinked savings schemes (ELSS).

"Largely, it will bring flexibility to people in terms of lock-in and lower lock-in will make it (the sum invested) available after three years," said Suresh Sadagopan, founder of Ladder 7 Financial Advisories. "This will bring bank FD in direct competition with ELSS."

Financial saving as a percentage of gross domestic saving fell to 7.1% in 2012-13 from 7.2% in the previous year. Gross domestic saving fell to 30.1% from 31.3% during this period.

At present, investment up to Rs 1.5 lakh in certain instruments including various post office schemes, public provident fund, bank deposit, life insurance and principal paid on housing loan is eligible for a tax rebate.

Source: www.economictimes.indiatimes.com

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Grant of Exemption from filing returns withdrawals of concession - CST Act

It has been clarified earlier by the circular No. VAT/2013/DCAR(1)/Misc-42 Trade Cir. No. 20T of 2014 Dated 25.11.2014, that where there are no inter-state sales in any return period then no return is required to be filed under the Central Sales Tax Act, 1956, (CST Act) provided that the Maharashtra Value Added Tax Act, 2002 (MVAT Act) return for the same period shows "NIL" turnover of inter-state sales.

The exemption granted in respect of filing of the returns under the CST Act was posing difficulties in generating the lists of returns defaulters under the CST Act in the automation system i.e. Mahavikas.

In view of the above, the issue has been re-examined and fresh guidelines are being issued by modifying the earlier circulars on the subject.  The revised instructions are as follows:

a) A dealer, who is claiming deduction, u/s. 8(1) of the MAVT Act or deduction u/s. 6A (branch transfers etc.) of the CST Act, in the MVAT return shall be required to file a  return under the CST Act. In other words, a dealer who is effecting the following types of transactions during a period shall be required to file CST Return:

• inter-State sales u/s. 3 of CST Act,
• goods transferred u/s. 6A(1) of CST Act,
• Sales outside the state u/s. 4 of CST Act,
• Export sales u/s. 5(1) and 5(3) of the CST Act,
• Sales in the course of import u/s. 5(2) of the CST Act,

b) These instructions shall be applicable for the returns starting for the period from the 1st October, 2014 onward.

It may be noted that a dealer not filing CST return in the above referred contingencies shall be henceforth treated as defaulter under the CST Act.

You are requested to bring contents of this circular to the  notice of the members of your associations.

Download Circular of Grant of Exemption from filing returns withdrawals of concession - CST Act (Click Here)

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Know more about Income Tax Deductions and Exemptions both are different.

Income tax return can be filed by an individual taxpayer in form ITR-1 where the total income consists of the following income:

• “Salaries” or income in the nature of family pension or
• “Income form house property”, where assessee does not own more than 1 house property and does not have any brought forward loss under the head; or
• “Income from other sources”, except winnings from lottery or income from race horses and does not have any loss under the head.

1. It is Provided that the ITR-1  form cannot be used by the person who:
   (a)  is a resident, other than not ordinarily resident in India within the meaning of sub-section (6) of section 6 and has
        i)  assets (including financial interest in any entity) located outside India; or
       ii) signing authority in any account located outside India;
  
   (b) has claimed any relief of tax u/s 90 or 90A or deduction of tax under section 91; or

   (c) has income not chargeable to tax, exceeding Rs. 5,000/-.

2. In your specific case, if you satisfy the above criteria, you can file the return of income in form ITR-1.

3. Exemption and deduction are two commonly used terms many get confused with, and most of the taxpayer can’t differentiate between the two. One needs to understand the difference between the two terms that many people commonly consider as one and the same.
 

DEDUCTION:The word “deduct” means “to subtract or take away from the total”. Tax deduction allows you to put some of your income to use in certain specified investments or expenses and deduct the amount from your income, thereby lowering your ultimate taxable income. In short, deduction reduces the amount of income which is taxable. Deduction is always on income forming part of your total income.

[Few deduction forming part majority of tax payers are chapter VIA deductions like Deduction u/s 80C towards investments in LIC/PPF/NSC etc, U/s 80D towards health insurance premium, U/s 80E towards education loan interest payment, U/s 80G towards donations, U/s 80DD towards medical treatment of handicapped dependant etc.]

EXEMPTION:
Exemption means “Tax Free”. Exempted income does not form part of your total income on which income tax has to be paid. Another major difference between deduction & exemption is that exempt income doesn’t not form the part of gross total income (GTI).

[Few exemption available to majority of tax payers are life insurance money back, PPF Maturity proceeds, Agricultural income, share of profit from the partnership firm etc]

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Salary paid to Indian Branches Employee's by overseas HO is fully deductible.

Where assessee, a bank incorporated in Japan, paid salaries abroad to its expatriates working in Indian branch constituting PE, in view of fact that said expenditure had been incurred wholly and exclusively for Indian branch and, no part of those expenses could be allocated to any other branch by head office, provisions of section 44C did not apply to said expenditure and thus, assessee's claim for deduction of salary expenses was to be allowed.

Where PE of assessee received interest on deposits kept with HO, it was opined that once interest received by PE was deemed to be income of PE and there was no bar in India-Japan treaty on its taxability, then it could not be excluded from computation of income earned by PE.

MAT provisions are applicable only to domestic companies and not to foreign companies.

Where assessee-bank claimed that provisions of section 115JB were not applicable to its case, in view of provisions of section 90(2), assessee's claim for lower impostion of tax in terms of article 7(3) of India-Japan DTAA had to be accepted because provisions of section 115JB are subordinate to section 90(2) and have no overriding effect on said section.

Source: www.taxmann.com

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Exemption for Income Tax of Medical Benefits as Treamtnet, Diseases and Hospitality.

⁷⁷[Exemption of medical benefits from perquisite value in respect of medical treatment of prescribed diseases or ailments in hospitals approved by the Chief Commissioner.

3A. (1) ⁷⁸[In granting approval to any hospital other than a hospital for Indian system of medicine and homoeopathic treatment for the purposes of sub-clause (b) of clause (ii) of the proviso to sub-clause (vi) of clause (2) of section 17], the Chief Commissioner shall satisfy himself that the hospital is registered with the local authority and fulfils the following requirements, namely :—

   (i)  The building used for the hospital complies with the municipal bye-laws in force.

  (ii)  The rooms are well ventilated, lighted and are kept in clean and hygienic conditions.

 (iii)  At least ten iron spring beds are provided for patients.

 (iv)  At least one properly equipped operation theatre is provided, with minimum floor space of 180 square feet and with a separate sterilisation room.

  (v)  At least one labour room is provided, with minimum floor space of 180 square feet, in case the hospital provides medical service for maternity cases.

 (vi)  Aseptic conditions are maintained in the operation theatre and the labour room.

 (vii) A duty room is provided for the nursing staff on duty.

(viii) Adequate space for storage of medicines, food articles, equipments, etc., is provided.

  (ix) The water used in the hospital or nursing home is fit for drinking.

   (x)  Adequate arrangements are made for isolating septic and infectious patients.

  (xi)  The hospital is provided with and maintains :—

(a)  high pressure sterilizer and instrument sterilizer;

(b)  oxygen cylinders and necessary attachments for giving oxygen;

(c)  adequate surgical equipments, instruments and apparatus including intravenous apparatus;

(d)  a pathological laboratory for testing of blood, urine and stool;

(e)  electro-cardiogram monitoring system;

(f)  stand-by generator for use in case of power failure.

(xii) There is at least one qualified doctor available on duty round the clock for every twenty beds or fraction thereof.

(xiii) In hospitals providing intensive care unit facilities, there are at least two qualified doctors available on duty round the clock exclusively for such intensive care unit.

(xiv) One nurse is on duty round the clock for every five beds or a fraction thereof.

(xv)  In hospitals providing intensive care unit facilities, there are at least four nurses provided exclusively for every four beds or fraction thereof for such intensive care unit.

(xvi) The hospital maintains record of health of every patient containing information about the patient's name, address, occupation, sex, age, date of admission, date of discharge, diagnosis of disease and treatment undertaken.

⁷⁹[(1A) In granting approval to any hospital for Indian system of medicine and homoeopathic treatment for the purposes of sub-clause (b) of clause (ii) of the proviso to sub-clause (vi) of clause (2) of section 17, the Chief Commissioner shall satisfy himself that the hospital fulfils the conditions specified vide Office Memorandum dated the 6th June, 2002⁸⁰, by the Department of Indian Systems of Medicine and Homoeopathy, Ministry of Health and Family Welfare for approval of private hospitals for Indian system of medicine and homoeopathic treatment to Central Government Health Scheme beneficiaries and Central Government employees.]

(2) For the purpose of sub-clause (b) of clause (ii) of the proviso to ⁸¹[sub-clause (vi) of] clause (2) of section 17, the prescribed diseases or ailments shall be the following, namely :—

(a)  cancer;

(b)  tuberculosis;

(c)  acquired immunity deficiency syndrome;

(d) disease or ailment of the heart, blood, lymph glands, bone marrow, respiratory system, central nervous system, urinary system, liver, gall bladder, digestive system, endocrine glands or the skin, requiring surgical operation;

(e)  ailment or disease of the eye, ear, nose or throat, requiring surgical operation;

(f)  fracture in any part of the skeletal system or dislocation of vertebrae requiring surgical operation or orthopaedic treatment;

(g) gynaecological or obstetric ailment or disease requiring surgical operation, caesarean operation or laperoscopic intervention;

(h)  ailment or disease of the organs mentioned at (d), requiring medical treatment in a hospital for at least three continuous days;

(i)  gynaecological or obstetric ailment or disease requiring medical treatment in a hospital for at least three continuous days;

(j)  burn injuries requiring medical treatment in a hospital for at least three continuous days;

(k) mental disorder - neurotic or psychotic - requiring medical treatment in a hospital for at least three continuous days;

(l)  drug addiction requiring medical treatment in a hospital for at least seven continuous days;

(m) anaphylectic shocks including insulin shocks, drug reactions and other allergic manifestations requiring medical treatment in a hospital for at least three continuous days.

Explanation : For the purpose of this rule,—

(a)  "qualified doctor" means a person who holds a degree recognised by the Medical Council of India and is registered by the Medical Council of any State;

(b)  "nurse" means a person who holds a certificate of a recognised Nursing Council and is registered under any law for the registration of nurses;

(c)  "surgical operation" includes treatment by modern methodology such as angioplasty, dialysis, lithotropsy, laser or cryo-surgery.]

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All about TDS / TCS Return Statements - FAQs.

Who is required to file e-TDS / e-TCS statement?
As per Income Tax Act, 1961, all corporate and government deductors / collectors are mandatorily required to file their TDS / TCS statements on electronic media (i.e. e-TDS / TCS statements). However, deductors / collectors other than corporate / government can file either in physical or in electronic form.

What are the due dates for filing of statement?


What will be the consequences if I do not file TDS / TCS statement within due date?
There will be a levy of Rs. 200.00 per day under section 234E of the IT Act, 1961 from the due date till the date when statement is filed.

Is there any penalty for non-filing of TDS / TCS statements?
Yes. If TDS / TCS statement is not filed for one year from the due date of filing, there would be a penalty of minimum Rs. 10,000.00 to Rs. 1,00,000.00 for not filing TDS / TCS statement under section 271H of the IT Act, 1961.

How can a Deductor / Collector check the status of TDS / TCS statement filed?
Status of TDS / TCS statements filed by a deductor can be checked by logging in to TRACES as deductor. This facility would be available only to a registered user of the portal.

What are the different statuses available on TRACES regarding TDS / TCS statement?
Following processing status shall be displayed for regular statement:

• Pending for Processing
• Processed for Form 26AS
• Processed without Defaults
• Processed with Defaults

Following processing status shall be displayed for correction statement:

• Pending for Processing
• Processed for Form 26AS
• Processed without Defaults
• Processed with Defaults
• Rejected

What are the common reasons for rejection of correction statement by TDS-CPC? 

Following are the common reasons for rejecting a correction statement:

• TAN is not valid as per data at TDS CPC
• Statement corresponding to regular token number / previous token number field, as given in correction return, does not exist
• Previous token number does not correspond to the last accepted correction statement at TDS CPC
• Correction is filed for a regular return which is in cancelled state
• In a correction statement, below are the verification keys which should match with the corresponding fields of regular statement :

        RRR assessment year
        Return Financial Year
        Periodicity
        Previous Token number
        Last TAN of Deductor
        Receipt number of Original / Regular Return
        Form number

• Sum given in 27A form should match with the sum of deducted amount of deductee records given in the correction statement

What are the reasons to reject the correction in deductee records by TDS-CPC?
Rejection reasons pertaining to deductee details are as follows:

• In a correction statement that updates / deletes deductee rows, verification keys from deductee data that should match with corresponding fields in regular / previous return are – Last PAN, Last total amount deducted at source, Last total amount deposited
• Updation / deletion on deductee record is submitted in a correction statement but this deductee record does not exist in previous/ regular return
• Valid PAN to invalid PAN update is not allowed for a deductee row
• Deductee detail record number should be unique in case of addition of deductees
• If value of Reason for non-deduction / lower deduction / higher deduction / threshold field as per regular or last correction statement is ‘C’ , then update can be performed only on ‘PAN’, ‘Amount of Payment’ and ‘Date of Payment’
• Deletion of deductee record having value C in Reason for non-deduction / lower deduction/ higher deduction / threshold field, is not allowed
• Valid PAN to another valid PAN update can be done only once for a given deductee row

What are the reasons to reject the correction in salary detail records by TDS-CPC?Rejection reasons pertaining to salary details are as follows:

• In case of salary detail PAN update or delete of salary detail record, last total gross income should match with corresponding value in regular / previous statement
• Salary detail record on which correction is filed does not exist in the regular / previous return
• In case of addition of salary detail record, the record number should be unique and in sequence with the existing records in regular / previous return

Source: TRACES

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All about Exemption From Filing of Income Tax Return.

Recently many taxpayee are searching about "No Need to File / e-File Income Tax Return".  There are so many notification regarding non-filing or filing of Income Tax Return for Fin. Year 2013-14 under some circumstances i.e. Taxable Income below Rs. 5 Lakhs & Saving Bank Interest Income below Rs. 10000/-, "Interest loss on House Property" etc. Apart from this some are applicable for those taxpayers who are getting Salary and Loss from House property on account of Interest on housing loan etc.

Under the existing procedure, DDO/employer can give credit to the  employee for a claim for loss under the head “income from house property” u/s  24 made by the employee. As a result, a salaried employee’s total income may  reduce to less than Rs.5,00,000 as loss from the head “income from house  property” would have been set-off against salary income. Such a taxpayer is not  exempted from filing his return of income as the notification exempts only cases  where the total income is under the head “salary” and from savings bank account (income from other sources) not in excess of Rs.10,000. If the taxpayer  has any loss under the head “income from house property”, he will not be  eligible for exemption from filing a return of income.

In view of the above each and every taxpayer should study Exemption Notification for non-filing of ITR carefully before taking his final decision for non-filing of Income Tax Return.

NO NEED TO FILE INCOME TAX RETURN

Now CBDT has clearly notified that an individual  getting salary upto 5 Lakh after allowing all deductions from a single employer and getting interest income up to Rs. 10,000 from his Saving Bank Deposit account will be eligible to get exemption from filling of Income Tax Return from the Financial Year 2010-11 with some conditions like he will provide his PAN number to our employer and will  submit complete bank interest detail and also pay all amount of Income Tax in the shape of TDS deduction from salary and also receive form 16 from his employer.  There are some more conditions in which exemption for filling of Income Tax return will not be provided.  Therefore , all individuals are requested to read complete Notification which is given below  issued by CBDT before getting exemption for filling of Income Tax Return.

No.402/92/2006-MC (14 of 2011)

Government of India / Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

***

New Delhi, dated the 23rd June, 2011

PRESS RELEASE

The Central Board of Direct Taxes has notified the scheme exempting salaried  taxpayers with total income up to Rs.5 lakh from filing income tax return for assessment year  2011-12, which will be due on July 31, 2011.

Individuals having total income up to Rs.5,00,000 for FY 2010-11, after allowable  deductions, consisting of salary from a single employer and interest income from deposits in  a saving bank account up to Rs.10,000 are not required to file their income tax return. Such  individuals must report their Permanent Account Number (PAN) and the entire income from  bank interest to their employer, pay the entire tax by way of deduction of tax at source, and  obtain a certificate of tax deduction in Form No.16.

Persons receiving salary from more than one employer, having income from sources other than salary and interest income from a savings bank account, or having refund claims shall not be covered under the scheme.

The scheme shall also not be applicable in cases wherein notices are issued for filing  the income tax return under section 142(1) or section 148 or section 153A or section 153C of  the Income Tax Act 1961.

xxxx

Notification

NOTIFICATION NO. 36/2011 [F. NO. 142/09/2011 (TPL)]

DATED 23-6-2011

In exercise of the powers conferred by sub-section (1C) of section 139 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby exempts the following class of persons, subject to the conditions specified hereinafter, from the requirement of furnishing a return of income under sub-section (1) of section 139 for the assessment year 2011-12, namely :—

Class of Persons

An Individual whose total income for the relevant assessment year does not exceed five lakh rupees and consists of only income chargeable to income-tax under the following head,—

(A)  “Salaries”;

(B)  “Income from other sources”, by way of interest from a savings account in a bank, not exceeding ten thousand rupees.

Conditions

The individual referred to in para 1,—

(i)  has reported to his employer his Permanent Account Number (PAN);

(ii)  has reported to his employer, the incomes mentioned in sub-para (B) of para 1 and the employer has deducted the tax thereon;

(iii)  has received a certificate of tax deduction in Form 16 from his employer which mentions the PAN, details of income and the tax deducted at source and deposited to the credit of the Central Government;

(iv)  has discharged his total tax liability for the assessment year through tax deduction at source and its deposit by the employer to the Central Government;

(v)  has no claim of refund of taxes due to him for the income of the assessment year; and

(vi)  has received salary from only one employer for the assessment year.

The exemption from the requirement of furnishing a return of income-tax shall not be available where a notice under section 142(1) or section 148 or section 153A or section 153C of the Income-tax Act has been issued for filing a return of income for the relevant assessment year.

This notification shall come into force from the date of its publication in the Official Gazette.

Last circular vide which e-filing was mandatory for those whose total income exceeds 10 lakh.

MANDATORY e-FILING OF INCOME TAX RETURN

PRESS RELEASE [NO. 402/92/2006-MC (12 OF 2012)], DATED 2-7-2012

CBDT has issued notification S.O. 626(E), dated 28th March 2012 vide which e-Filing has been made compulsory for Assessment Year 2012-13 onwards for :

• an individual or a Hindu undivided family, if his or its total income, or the total income in respect of which he is or it is assessable under the Act during the previous year, exceeds ten lakh rupees; and
• an individual or a Hindu Undivided Family (HUF), being a resident, having assets (including financial interest in any entity) located outside India or signing authority in any account located outside India and required to furnish the return in Form ITR-2 or ITR-3 or ITR-4.

However, digital signature will not be mandatory for these taxpayers and they can also transmit the data in the return electronically and thereafter submit the verification of the return in Form ITR-V.

2. Filing of returns electronically under digital signatures is already mandatory for any company required to furnish the return in Form ITR-6 or a firm required to furnish the return in Form ITR-5 or an individual or HUF required to furnish the return in Form ITR-4 and to whom provisions of section 44AB are applicable.

3. The Income Tax Department has received a record number of 1.64 crore income tax returns electronically in the year 2011-12. E-filing is an easy, fast and secure method of filing of income tax return. The electronically filed returns are processed at the Centralized Processing Centre, Bengaluru. The processing for e-filed return is faster and taxpayers get their refunds, if due, quickly. The Department also provides some value added services like tracking of refunds, viewing tax credit status (Form 26AS), e-mail and SMS alerts regarding status of processing and refunds to taxpayers who e-file their returns.

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