Income Tax Return

Learn how to respond to a defective return notice under Section 139(9) of the Income Tax Act, 1961, and avoid penalties or delays in refunds.

How to Respond to Defective Return Notice Under Section 139(9) of the Income Tax Act, 1961\\\\r\\\\nIntroduction\\\\r\\\\nFiling your Income Tax Return (ITR) can be a detailed task, especially if it\\\\\\\'s something you do only once a year. Errors or missing details can occasionally slip through, and when this happens, the income tax department might label your ITR as “defective” and issue a notice under Section 139(9) of the Income Tax Act, 1961. A defective return notice is essentially an alert that gives you a chance to correct your return and avoid consequences like penalties, invalid returns, and delays in refunds.\\\\r\\\\nIn this article, we’ll walk you through what triggers a defective return notice, common scenarios, and how you can effectively respond to a defective return notice under Section 139(9).\\\\r\\\\nWhat is a Defective Return?\\\\r\\\\nA defective return is an ITR with mistakes or missing information identified by the income tax department. This could include errors in calculations, omitted income details, mismatches in tax deductions and income reporting, or missing mandatory statements. When a return is marked defective, the department issues a notice urging the taxpayer to rectify these issues to ensure an accurate and complete return.\\\\r\\\\nHow Will I Receive a Notice Under Section 139(9)?\\\\r\\\\nThe income tax department sends the defective return notice via email to your registered email address. You can also view it on the income tax e-filing portal under the \\\\\\\"Pending Actions\\\\\\\" section. The email subject typically reads: \\\\\\\"Communication under Section 139(9) for PAN [Your PAN] for Assessment Year [Year].\\\\\\\"\\\\r\\\\nPassword to Open the Notice: The defective return notice is a password-protected PDF file. The password format is your PAN in lowercase followed by your date of birth (DDMMYYYY). For example, if your PAN is MOCTEN5778C and your date of birth is 21/11/1982, your password would be mocten5778c21111982.\\\\r\\\\nTime Limit to Respond\\\\r\\\\nYou have 15 days from the date of receiving the notice to respond. If the defects are not addressed within this timeframe (or within an extension if granted), your return will be deemed invalid, which can lead to a loss of refund eligibility and other potential consequences.\\\\r\\\\nCommon Reasons for a Defective Return Notice\\\\r\\\\nHere are some common reasons why your ITR might be flagged as defective:\\\\r\\\\n1. Incomplete ITR: Essential fields or statements, such as income sources, are not filled out.\\\\r\\\\n2. Missing Tax Information: Paid taxes are not adequately detailed in the return.\\\\r\\\\n3. TDS and Income Mismatch: TDS claimed but corresponding income not declared.\\\\r\\\\n4. Bookkeeping Errors: Lack of necessary financial documents like profit & loss accounts or balance sheets.\\\\r\\\\n5. Audit Concerns: If an audit is required under Section 44AB, but the audit report is incomplete.\\\\r\\\\n6. Cost Audit Non-compliance: For companies, failure to submit cost audit details.\\\\r\\\\n7. Errors in Presumptive Taxation: Incorrect presumptive income details.\\\\r\\\\n8. Tax Payment Discrepancies: Taxes paid don’t match with tax liability.\\\\r\\\\n9. Incorrect ITR Details: Mistakes in turnover or income limits.\\\\r\\\\n10. Mismatch in Name: Name on ITR doesn’t match PAN details.\\\\r\\\\nHow to Respond to a Defective Return Notice Under Section 139(9)\\\\r\\\\nStep 1: Review the Defect\\\\r\\\\nThe first step is to understand the issue raised in the notice. For example, if there is a mismatch between Form 26AS and your ITR, download Form 26AS from the income tax portal to verify income sources like interest or dividend income.\\\\r\\\\nStep 2: Revise Your Return on the Tax Filing Platform (e.g., ClearTax)\\\\r\\\\n1. Log In: Sign in to your chosen tax filing platform.\\\\r\\\\n2. Access the Return: Go to \\\\\\\"My Account\\\\\\\" > \\\\\\\"My Tax Returns.\\\\\\\"\\\\r\\\\n3. Mark ITR as Revised: Select \\\\\\\"Mark your ITR as Revised\\\\\\\" and make the necessary corrections.\\\\r\\\\n4. Make Additional Payments if Required: Update any additional tax payable with challan details.\\\\r\\\\n5. Prepare the Rectification JSON: Once done, click “Prepare Rectification JSON u/s 139(9),” and download the JSON file.\\\\r\\\\nStep 3: Upload Revised Return on the Income Tax Portal\\\\r\\\\n1. Log In: Log in to the e-filing portal.\\\\r\\\\n2. Navigate to E-Proceedings: Go to “Pending Actions” > “E-proceedings” and select “View Notices.”\\\\r\\\\n3. Submit Response: Read the notice, then click \\\\\\\"Submit Response.\\\\\\\"\\\\r\\\\n4. Upload JSON File: If you agree with the defect, upload the revised JSON file prepared on your tax filing platform.\\\\r\\\\n5. Disagreement Option: If you disagree, choose “Disagree” and provide reasons.\\\\r\\\\n6. E-Verify: Complete the process by e-verifying the response, ensuring submission confirmation with an acknowledgment number.\\\\r\\\\n<H3>Conclusion</H3>\\\\r\\\\nResponding promptly to a defective return notice under Section 139(9) of the Income Tax Act, 1961 is crucial to avoid issues such as invalid returns, delays in refunds, and possible penalties. Understanding common causes and carefully following the steps to revise your return can help ensure a smooth response process. Remember, careful filing of your tax return initially and paying attention to details can prevent defective notices altogether.\\\\r\\\\n\\\\r\\\\n\\\\r\\\\nFAQs\\\\r\\\\n1. What should I do if I cannot respond within 15 days?\\\\r\\\\nYou may request an extension if you cannot respond within the initial 15 days. Failure to respond within the allowed time will invalidate your return.\\\\r\\\\n2. Will a defective return notice impact my refund?\\\\r\\\\nYes, if the defective return is not corrected, the original return will be treated as invalid, and any refund due will not be processed.\\\\r\\\\n3. What is Form 26AS, and how does it relate to a defective notice?\\\\r\\\\nForm 26AS is a tax statement summarizing the tax deducted at source (TDS) and other income details. Any discrepancies between Form 26AS and your ITR may trigger a defective notice.\\\\r\\\\n4. Can I disagree with a defective return notice?\\\\r\\\\nYes, if you believe the defect raised is incorrect, you can select “Disagree” and provide an explanation.\\\\r\\\\n5. What happens if my return is treated as invalid?\\\\r\\\\nIf your return is declared invalid, it’s as if it was never filed, impacting refunds, exemptions, carry-forward losses, and potentially incurring penalties.\\\\r\\\\n

Published on: January 10, 2025, 8:24 pm