Section 139 of the Income Tax Act, 1961, outlines the various types of income tax returns (ITRs) that individuals or entities are required to file. It mandates that any individual or entity whose total income exceeds the exemption limit must file an income tax return for the relevant assessment year.
It must be noted that this section is divided into various sub-sections, such as Sec 139(1), Sec 139(3), and Sec 139(9). These subsections cover the different situations and conditions under which filing a tax return is necessary. Let’s understand the key provisions of Sec 139 in detail, study its various sub-sections, and check the latest amendments.
What is Section 139 of the Income Tax Act?
Section 139 of the Income Tax Act mandates that taxpayers file their income tax returns before the stipulated deadlines. It also provides provisions for:
- Filing delayed returns
and - Correcting errors to maintain compliance with tax regulations
Taxpayers must understand that timely and accurate filing of income tax returns is crucial to complying with legal requirements and avoiding penalties. For this purpose, Section 139 ensures that taxpayers are aware of their tax-related obligations by providing mechanisms to rectify mistakes or delays in filing.
Provisions under Section 139 of the Income Tax Act
The primary goal of Section 139 is to ensure taxpayers maintain compliance with tax regulations and fulfil their obligations. For this purpose, it offers several provisions that must be followed. Let’s check them out:
Mandatory filing of returns
Every individual whose total income (without subtracting any deduction) exceeds the basic exemption limit set by the Income Tax Act must file an income tax return. For companies and firms, filing an income tax return is mandatory regardless of whether they made a profit or incurred a loss during the financial year.
Due dates
Section 139 of the Income Tax Act, 1961, sets specific deadlines for filing income tax returns, which can vary based on the type of taxpayer or their situation. The deadline of July 31st applies to individuals not required to undergo an audit, including salaried individuals, self-employed professionals, freelancers, and consultants. Although extensions to August 31st are common, these categories must generally meet the July 31st deadline. Taxpayers required to have their accounts audited, such as business entities, self-employed professionals needing an audit, and partners or consultants in firms with audited accounts, must file their returns by September 30th, though this deadline may also be extended by the government. These deadlines ensure timely compliance with the provisions of the Income Tax Act.
Revised and belated returns
Taxpayers can revise their filed returns under Section 139(5) if they discover any errors or omissions. Additionally, taxpayers who miss the original due date can still file a “belated return” under certain conditions. However, filing a late return may incur penalties or interest.
Exceptional cases
Some individuals must file returns even if their income is below the taxable limit. This includes cases where:
- They seek a refund
or - Want to carry forward losses under any head of the income
Electronic filing
Certain categories of taxpayers are required to file their returns electronically. This ensures a faster and more efficient process for both submission and processing of tax returns.
Also read about: What is Direct Tax Code 2025
Subsections under Section 139 of the Income Tax Act
Section 139 of the Income Tax Act, 1961, is divided into various sub-sections. These subsections specify:
- Who must file returns
- What are the due dates for filing returns
- What conditions must be met for filing revised or belated returns
- When is return filing mandatory even if income is below taxable limits
It is worth mentioning that taxpayers must understand these subsections to remain compliant and fulfil their tax obligations. Let’s check out some key sub-sections you must be aware of:
1. Section 139(1) of the Income Tax Act: Mandatory and timely income tax return submission
Section 139(1) of the Income Tax Act, 1961, states that individuals must file an income tax return by the due date if their total income is above the basic exemption limit. However, this requirement varies based on the different types of taxpayers. Let’s see how:
For companies
- Any type of company (private, public, domestic, or foreign) operating in India must file a tax return.
For firms
- Any firm, including Limited Liability Partnerships (LLP) and Unlimited Liability Partnerships, must file a tax return.
For residents with foreign assets
- You must file a tax return if:
- You are a resident of India and own assets or have financial interests outside India
or - You have signing authority for a foreign account
- You are a resident of India and own assets or have financial interests outside India
Other entities
- Suppose the total income of a Hindu Undivided Family (HUF), an Association of Persons (AOP), or a Body of Individuals (BOI) exceeds the exemption limit. In that case, they must file a tax return.
Furthermore, the central government can grant exemptions to certain groups from return filing under Section 139(1c), if they meet specific conditions. Any exemption granted must be presented to both Houses of Parliament for 30 days during their sessions. If both Houses agree, the exemption becomes effective.
Also, it is important to know that if you are not required to file a tax return but choose to do so, your filing is considered voluntary. Voluntary returns are treated as valid tax returns.
2. Section 139(3): Filing ITR with loss
Under Section 139(3) of the Income Tax Act, you file income tax returns with losses. By filing returns under section 139(3), you can carry forward the losses, which reduces your tax burden in future years.
Let’s understand the different requirements of this section, which, again, varies based on the different classes of taxpayers:
For individual taxpayers
- If you are an individual and had a loss in the previous financial year, you don't have to file a tax return.
For companies and firms
- If a company or firm incurs a loss, they must file a tax return if they want to
- Carry forward the loss
and - Use it to reduce their tax liability in future years
- Carry forward the loss
- If the loss is under the head Profits and Gains of Business & Profession (PGBP) or capital gains, you must file the tax return by the due date to carry forward the loss.
- On the other hand, if the loss is under the head house property, you can carry it forward even if the tax return is filed after the due date.
Also read about: Income Tax Act and Direct Tax Code
3. Section 139(4): Belated income tax return
Sec 139(4) of the Income Tax Act allows you to file belated or delayed income tax returns. Ideally, you should file your tax return by the due date mentioned in Section 139(1) or within the time allowed by a notice issued under Section 142(1). However, if you miss the deadline, you get another chance to file a belated return under section 139(4).
The time limit for filing a belated return is:
- One year from the end of the relevant assessment year
or - Completion of the assessment, whichever happens first.
Also, it is worth mentioning that late filing is subject to penalties. If you file your return after the end of the relevant assessment year, you have to pay a penalty of Rs. 5,000 under Section 271F of the IT Act 1961.
4. Section 139(4C) and 139(4D): Income tax exemption under Section 10
Section 139(4C) is for certain institutions that are required to file tax returns only if their accumulated funds exceed the maximum allowable exemption limit under Section 10. These institutions are:
- Scientific research associations
- Institutions under Section 10(23A)
- Organisations involved in news dissemination
- Institutions under Section 10(23B)
- Educational and medical institutions
These institutions can claim tax exemptions under specific clauses of Section 10: Clauses 21, 22B, 23A, 23C, 23D, 23DA, 23FB, 24, 46, and 47.
Now, when it comes to Section 139(4D), it grants exemptions from return filing to institutions covered under these sections:
- Section 35(1)(ii): Related to scientific research
- Section 35(1)(iii): Pertains to research in social science or statistical research
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5. Section 139(5): Filing a revised return
If you filed your return before the due date but made a mistake, you can file a revised return under section 139(5). This revised return can be filed:
- Within one year after the end of the assessment year
or - Before the assessment is completed, whichever is sooner.
A revised return replaces the original return, and there is no limit to the number of times you can revise within the specified timeframe. However, remember that revised returns are only for correcting unintentional mistakes.
6. Section 139(8A): Updated income tax returns
Section 139(8A) of the Income Tax Act allows taxpayers of all classes (Individuals, HUF, Firms, AOP, BOI, etc.) to file an updated income tax return. This provision allows taxpayers to amend any incorrect information or report additional income that was missed in the original return.
However, you can file a return under this section only if:
- You did not file an income tax return previously
- There were mistakes or omissions in the originally filed return
- You need to report additional income that was not included in the original return and pay any additional taxes due
7. Section 139(9): Defective income tax returns
Section 139(9) of the Income Tax Act, 1961, outlines the concept of defective tax returns. A tax return is deemed defective if certain essential documents are missing when it is filed.
Usually, if the tax officer finds a return to be defective, they will notify you (the taxpayer). After this, you have 15 days from the date of notification to fix the defect. If required, you can even request more time to rectify the defect.
Now, let’s check out a list of all the necessary documents required to avoid a defective return:
Types of documents |
Explanation |
Completed tax return |
Ensure your tax return is filled out in the recommended form. |
Tax computation statement |
Include a statement showing how you calculated the taxes payable by you. |
Proof of tax payments |
Provide evidence for all tax payments made, such as:
|
Audit report (if applicable) |
If your accounts are audited under Section 44AB, include the audit report. |
Books of accounts (when maintained)
|
Attach copies of your financial statements, such as:
|
Books of accounts (not maintained) |
If you do not maintain books of account, provide a statement showing:
|
How to file defective returns under Section 139(9)?
If a tax return is deemed defective by the assessing officer, the taxpayer will receive a defective return notice and must address it within 15 days.
Here’s how to handle the situation:
- Identify and Rectify Defects: Review the issues highlighted by the Income Tax Department and revise the return to address these defects within the 15-day timeframe.
- Request an Extension: If unable to rectify the defects within the stipulated period, you can apply for an extension.
Failure to correct the defective return within the given period or denial of an extension will result in the return being treated as invalid. This can lead to consequences such as penalties, interest charges, the inability to carry forward losses, and the forfeiture of certain exemptions.
Due dates for Section 139
Individuals and entities who do not require an audit of their accounting books are required to file an income tax return by July 31st of the relevant assessment year. Some common examples of such taxpayers are:
- Employees receiving salary income
- Self-employed individuals (like freelancers or consultants)
- Professionals
However, individuals and entities required to undergo an audit of their accounting books must file an income tax return by September 30th of the relevant assessment year. Some common examples of such taxpayers are:
- Business entities
- Self-employed individuals
- Working partners in firms
- Consultants needing audit of their accounts
Furthermore, it is important to consider that the government can extend these deadlines based on specific circumstances. Usually, the due dates are extended to ensure taxpayers have adequate time to prepare and file their income tax returns accurately.
Looking to file your income tax returns this season? Check out the latest income tax slabs of FY 24-25 and accurately calculate your tax liability.
How is ITR Form 7 related to Section 139?
Form ITR-7 is a specific income tax return used by certain individuals, institutions, and entities who need to file returns under specific sub-sections of Section 139. Let’s check out its applicability and filing methods:
Applicability
Form ITR-7 is used by individuals, institutions, and entities required to file returns under:
- Section 139(4a)
- For persons including companies required to furnish returns under Sections 139(4a) to 139(4c)
- Section 139(4b)
- For political parties are required to furnish returns under Section 139(4b).
- Section 139(4c)
- For institutions claiming exemption under Section 10, such as scientific research associations, news agencies, universities, etc.
- Section 139(4d)
- For colleges, universities, and institutions not required to furnish return under any other provision of this section.
- For colleges, universities, and institutions not required to furnish return under any other provision of this section.
Filing methods
Taxpayers can file Form ITR-7 by:
- Physically submitting the filled form to the Income Tax Department.
- Electronically filing the form and:
- Authenticating it via digital signature
or - Verifying the return by submitting Form ITR-V (Verification)
- Authenticating it via digital signature
Recent amendments in Section 139 of the Income Tax Act
To remain compliant and effectively file income tax returns without any hassles, let’s look at some recent amendments in Sec 139:
Amendment to Sub-section (1), sixth provision
Effective from April 1, 2017, the sixth provision of sub-section (1) of Section 139 of the Income Tax Act has been amended to replace the words "provisions of section 10A" with "provisions of clause (38) of section 10 or section 10A." This change broadens the scope to include clause (38) of section 10 and section 10A for certain conditions or exemptions
Amendment to sub-section (3)
In sub-section (3) of Section 139, the reference "sub-section (2) of section 73" has been expanded to include "or sub-section (2) of section 73A". This amendment ensures that the provisions now also apply to the additional rules specified under section 73A. This extends the applicability to a wider range of loss carry-forward situations.
Amendments to sub-section (4)
This sub-section has been revised to allow any person who missed the initial deadline to file their tax return. The time limit for filing such a return is anytime before the end of the relevant assessment year or before the assessment is completed, whichever occurs first. This amendment allows more flexibility for late filings within specified limits.
Amendment to sub-section (5)
This sub-section has been updated to permit a person to file a revised return at any time before the expiry of one year from the end of the relevant assessment year or before the assessment is completed, whichever is earlier. This extension allows more time for taxpayers to correct any omissions or errors in their original returns.
Error codes in Section 139 of the Income Tax Act
Different error codes under Section 139 indicate specific issues or deficiencies found in the filed income tax returns (ITRs). These codes prompt the income tax department to issue defect notices. After the receipt of such notices, taxpayers must rectify these issues within a specified period to:
- Ensure compliance with tax regulations
and - Avoid penalties or further consequencesNow, let’s check out some common error codes:
Error Code 14
- This error occurs when the taxpayer enters a negative amount in either the Gross Profit or Net Profit sections of the ITR
- It must be noted that such entries are not permissible and usually render the ITR defective.
- This error code prompts the tax authority to issue a notice for rectification.
Error Code 8
- This error code is generated when:
- A taxpayer files ITR-4S (presumptive income tax return under Section 44AD)
and
Declares a total presumptive income that is less than 8% of their Gross Turnover or Gross Receipts
- A taxpayer files ITR-4S (presumptive income tax return under Section 44AD)
- Such return filing violates the provisions of Sec 44AD and triggers a defect notice.
Error Code 31
- This error code is generated when:
- A taxpayer has income under the head "Profits and Gains of Business or Profession"
but - Fails to provide the Balance Sheet and Profit and Loss Account along with the return
- A taxpayer has income under the head "Profits and Gains of Business or Profession"
- As per the income tax provisions, these documents are essential for assessing the accuracy of business income.
- In cases of their absence, a defective return notice is sent by the department.
Error Code 38
- This error arises when
- The taxpayer determines tax as “payable” in the filed income tax return
but - Fails to make the corresponding tax payment
- The taxpayer determines tax as “payable” in the filed income tax return
- Failure to pay the tax makes the return defective, as it highlights discrepancies between tax computation and actual payment.
Conclusion
Section 139 of the Income Tax Act mandates the filing of income tax returns by individuals, companies, and firms. Individuals are compulsorily required to file their income tax returns if their total income without subtracting any deduction exceeds the basic exemption limit. On the other hand, companies and firms must file regardless of profit or loss.
Also, Section 139 provides several deadlines and allows for filing belated and revised returns to correct errors or omissions. This section is divided into various sub-sections that address different scenarios. Some common examples are carrying forward losses, mandatory filings for those with foreign assets, filing belated returns after the due date, and more.
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