The tax department has provided a one-time window till September this year to taxpayers who haven’t verified their income tax returns for the assessment years (AY) 2015-16 to AY 2019-20.
A notification issued today by the Central Board of Direct Taxes stated, “It has been brought to the notice of Central Board of Direct Taxes (‘CBDT’) that a large number of electronically filed ITRs still remain pending with the Income Tax Department for want of receipt of a valid ITR-V Form at CPC, Bengaluru from the taxpayers concerned. In law, consequences of non-filing the ITR-V within the time allowed is significant as such a return is/can be declared Non-est in law, thereafter, all the consequences for non-filing a tax return, as specified in the Income-tax Act,1961 (Act) follow.”
A taxpayer filing Income Tax Returns (ITR) electronically without a digital signature has to verify it using either Aadhaar one-time password (OTP), or logging into e-filing account through net banking, or by Electronic Verification Code (EVC) or by sending a duly signed physical copy of ITR-V through the post to CPC Bengaluru within 120 days of uploading the ITR.
As a one-time measure for resolving the grievances of the taxpayers associated with non-filing of ITR-V for earlier assessment years and to regularise such returns which have either become ‘non-est’ or have remained pending for non-filing or non-receipt of ITR-V form, the CBDT has permitted verification of electronically filed tax returns for assessment years 2015-16, 2016-17, 2017-18, 2018-19 and 2019-20 either by sending a duly signed physical copy of ITR-V to CPC Bengaluru through speed post or through EVC/OTP modes. Such a verification process must be completed by September 30, 2020.
It, however, clarified that “this relaxation shall not apply in those cases, where during the intervening period, Income-tax Department has already taken recourse to any other measure as specified in the Act for ensuring filing of a tax return by the taxpayer concerned after declaring the return as Non-est.”
Nangia & Co LLP Partner Shailesh Kumar said that in many cases, ITRs filed by individuals became invalid due to non-completion of the verification process. Consequently, tax refunds, if any, claimed in those ITRs also got stuck.
“By this order, the government not only relaxes the timeline allowing taxpayers to verify their past years’ invalid ITRs by September 30 but also allows the processing of such past ITRs by December 31, 2020. This order can benefit a large number of taxpayers, mostly being individual taxpayers, who could not verify their past ITRs inadvertently,” Kumar said.
This order provides a good opportunity to them for regularising their past ITRs and not only solve the issue of past non-compliance but also receive past pending refunds stuck due to this procedural lapse, he added.
AKM global tax partner Amit Maheshwari said, “This is a welcome measure as practically we have seen several cases where there were legacy issues in terms of nonreceipt of ITR V. Also, considering the consequences of non-filing, this was a much-needed relief.”
