6/16/2012
JB NAGAR STUDY CIRCLE OF
WIRC
ISSUES ON REVISED AND
RECTIFICATION OF ONLINE
FILED INCOME TAX RETURNS
Compiled by CA
Avinash Rawane
Compiled by CA Avinash
Rawane
23/06/2012
23/06/2012
Some Provisions of the Income Tax Act
If a person has filed his return of Income
u/s 139(1) of Income Tax Act 1961 i.e.
within the due date of filing the return
and if he subsequently finds that in the
original return he has committed some
mistake bonafide then he can revise his
return of income u/s 139(5) of Income Tax
Act.
1
6/16/2012
Compiled by CA Avinash Rawane
23/06/2012
Time period of filing the revised return
As per section 139(5), the revised return can
be filed before the expiry of one year from the
end of the relevant assessment year or before
the completion of assessment, whichever is
earlier. Thus return of A.Y 2011-12 can be
revised till 31st March 2013 or before the
completion of the assessment whichever is
earlier.
Compiled by CA Avinash
Rawane
23/06/2012
Which Returns can be Revised
• Original Returns filed under Section 139(1) of the
Income Tax Act, 1961;
• Returns filed in response to Notice under Section
148 of the Act;
• In case of Revised Returns filed u/s 148 all provisions
of Section 139 of the Act, will apply;
•
2
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Can Penalty be levied
• If revised return is filed to correct a bonafide mistake
then no penalty can be levied, otherwise it can be
levied.
• It is seen that sometimes assessees tend to file
Revised Return after search or survey; there are case
laws against and in favour of the assessee, help can
be taken there from, if required;
Compiled by CA Avinash
Rawane
23/06/2012
Online Filing of Rectification Returns
• Section 154 of the Act, deals with Rectification
of Returns;
• Online Filed Returns rectification to be filed
online only and cannot be submitted in paper
till the same is not transferred to AO;
• CPC monitors the Online Rectification of
Returns filed online;
3
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Web Page to Check the Status
Compiled by CA Avinash
Rawane
23/06/2012
Issues on Online Rectification Filing
Problems
Solution
•How
many
times I can file
the
revised
return
 Legally, a return can be
revised any number of
times before the expiry
of one year from the
end of the Assessment
Year or before the
assessment
by
the
Department
is
completed; whichever
event takes place earlier.
4
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Major Requirements of Filing
Rectification Returns
Receipt No of Original Return;
Date of Submission of Original
Return;
Entry of Code 16- u/s 139(5) in the
Revised Return for system to identify
that it is Revised Return.
Saved Data of the Original Return.
Compiled by CA Avinash
Rawane
23/06/2012
Issues on Online Rectification Filing
Problems
Solution
•Incorrect ITR
form used
• Yes,
it can be
rectified.
• Select
Correct
Utility and File the
Return
5
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Issues on Online Rectification Filing
Problems
Solution
e-Return has
been processed
by CPC raising a
demand
or
with
less
refund
 If Return is lying
with CPC, then file
Online Rectification;
 If transferred to AO
then
file
paper
Rectification with AO
and not with CPC.
Compiled by CA Avinash
Rawane
23/06/2012
Probable Reasons inability to file Revised
Return
Problems
•Input
does
match
records
Solution
data
not
the
• send a mail to
efiling@incometaxindia.gov.in
with the following details :
CPC
Order
No,
CPC
Order Date, Aggregate Income
Tax Liability (As Computed), Total
Tax
Credit
Allowed
(As
Computed)
6
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
• Step 1: Make sure you have received an intimation
under section 143 (1) from CPC Bangalore for the Ereturns filed by you for AY 2009-10 or later;
• Step 2: Carefully examine the intimation to see if the
computation by CPC is correct even if different from
what was expected by you. It may be that you may
have computed tax liability or interest incorrectly.
You can take the help by using departmental excel
utility available in e-filing website.
Compiled by CA Avinash
Rawane
23/06/2012
How to Place Request for Intimation
Not received
7
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Fill up the Request
Compiled by CA Avinash
Rawane
23/06/2012
One More Step Ahead
8
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
3 Ways to Receive Intimation
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
• Step 3: Since the Rectification Request is to
be submitted by uploading the complete xml
file similar to uploading the original return, it
may be preferable to start with the saved ereturn data that was prepared by the return
preparation utility/software (Department
provided excel software or other software),
in case it is available with the taxpayer.
9
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
•Step 4: Carefully review
the Common Error guide
and the table provided to
understand as the basic
reason for the variation.
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
• Step 5: All errors in data entry should be
completely corrected and schedules or fields
left blank should be filled accurately as
explained in the guide.
• The complete return should be filled
including TDS and Tax payment schedules
and not only schedules that need change or
the fields that need correction.
10
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
• This is because the entire return with
corrected data would be re-processed under
rectification.
• However, there should not be any revision in
income figures or new claims since then the
rectification request would be rejected or
rectification would be delayed. It may be
clearly noted that this facility is only for
correcting mistakes apparent from record..
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
• Step 6: After the Return data is corrected then
the xml can be generated. This is the
Rectification XML file;
• Step 7: Log in to
https://incometaxindiaefiling.gov.in
and go to My Account->
Rectification-> Rectification upload .
11
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
•Step 8: Fill in details from the
intimation sheet which will be
verified to ascertain that only the
taxpayer in possession of the
Intimation from CPC would be
able to submit a rectification
request..
12
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
Common Errors noticed
in E filed rectification
requests
Compiled by CA Avinash
Rawane
23/06/2012
• Correct Communication Reference number of the CPC
order which is sought to be rectified, in the specified
format in online rectification screen (“Submit your
rectification request screen”) rectification.
• 1st time rectification (For example AY 10-11, ITR 2):
CPC/1011/I2/1000008976
• I2 in the above reference number should be inferred as
English alphabet (I) and 2 indicates the ITR Form
type.
• Re-Rectification (For example AY 10-11,ITR 2):
CPC/1011/T2/1000008988;
13
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors noticed in E filed
rectification requests
• Mention the order date of CPC which is sought to be
rectified, in online rectification screen (“Submit your
rectification request screen”) while applying for
online rectification.
• Mention the row number of “Aggregate Tax
Liability” and “Total Tax Liability” of CPC order
instead of computed values of “Aggregate Income
Tax Liability” and “Total Tax Credit Allowed” while
applying for online rectification.
• The same are readily available on the Intimation
served;
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors noticed in E filed
rectification requests
• The amount against “Aggregate Income Tax
Liability” and “Total Tax Credit Allowed”
should be entered without comma (,) in
online rectification screen (“Submit your
rectification request screen”).
• Select the correct AY to which the
rectification pertains. from drop down in
Assessment Year Tab.
14
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
•Step 9: Fill in details of Schedules
where changes have been made
and
reasons
for
seeking
rectification. Fill in due date for
filing return, if incorrect as per
intimation sheet. Leave blank if
not applicable.
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
15
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
• Fill in details which are not available in
the return form such as details of 80G
donations (not available in ITR forms for
1, 2 and 3) and Quarter-wise details of
Capital Gains (all four types- which is
not available in ITRs 2, 3, 4, 5 and 6)
only if applicable. Leave blank if not
applicable.
Correction for Donation
Details
Compiled by CA Avinash
Rawane
23/06/2012
16
6/16/2012
Correction for Capital
Gains Claim Details
Compiled by CA Avinash
Rawane
23/06/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
• Note if your address has been changed in
the rectification XML file, you should
check the address changed checkbox to
ensure that the new address is updated
else the address as per old e-return only
will be used.
• It is advised to get the Address in PAN
Changed whenever there is a change.
17
6/16/2012
Check on Address Flag for
Change of Address
Compiled by CA Avinash
Rawane
23/06/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
•Step 10: Now upload the
Rectification
XML
file.
Validations will be done to
ascertain that only mistakes
apparent from record are
sought to be rectified.
18
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
•Step 11: Upon successful
upload, Rectification Request
number
and
acknowledgement will be
displayed.
Download the
Acknowledgement
Compiled by CA Avinash
Rawane
23/06/2012
19
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
How to submit Rectification Return
What is Next
Compiled by CA Avinash
Rawane
23/06/2012
20
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Displaying of Information
Compiled by CA Avinash
Rawane
23/06/2012
Restricted Time Limit of 7 days
21
6/16/2012
Withdrawal of the
Rectification Request
Request Withdrawn
Compiled by CA Avinash
Rawane
23/06/2012
Compiled by CA Avinash
Rawane
23/06/2012
22
6/16/2012
Re-submission and Rewithdrawal allowed
In case of Change of Bank
Details
Compiled by CA Avinash
Rawane
23/06/2012
Compiled by CA Avinash
Rawane
23/06/2012
23
6/16/2012
In case of Change of Bank
Details
Compiled by CA Avinash
Rawane
23/06/2012
Compiled by CA Avinash
Rawane
23/06/2012
COMMON REASONS FOR DELAY IN
DISPOSAL OF ONLINE RECTIFICATIONS
 After filing online rectification application with
change in bank details, assessee needs to send the
Response sheet giving particulars of bank account
along with cancelled cheque within stipulated time
for the processing of the rectification to commence.
 For change of bank details in case of refund failure,
there is NO NEED to file rectification application.
Only response sheet giving particulars of bank
account with cancelled cheque needs to be sent to
CPC.
24
6/16/2012
Issue
Compiled by CA Avinash
Rawane
23/06/2012
•CPC has processed the
Return and Notice of
Demand has been
issued under Section
156. Can the Return be
Revised?
Compiled by CA Avinash
Rawane
23/06/2012
REASONS FOR DISPOSING OF ONLINE
RECTIFICATION WITHOUT REDRESSAL.
• Need to carry out the corrections mentioned
in rectification request in the xml, if not done
the rectification will lead to non rectification
of the case.
• Assessees having paid demand are filing for
rectification to get a NIL demand
rectification order.
This is NOT
NECESSARY.
• Rectification applications where TOTAL
INCOME is changed will be rejected.
25
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
COMMON REASONS FOR DELAY IN
DISPOSAL OF ONLINE RECTIFICATIONS
• Rectification requests will be
auto-rejected when an earlier
rectification request is under
process. In such case no specific
reason is given except stating that
an earlier rectification request is
already under consideration.
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
•Salary
income
shown
at
higher figure
than entered
Probable reason and Resolution
 In Salary time higher figure is
reported under Gross salary
which should be excluding
Exempt
income
(such
as
transport
allowance
etc).
Taxpayer may have mentioned
Transport allowance in Exempt
Income and may have deducted
the same to arrive at a lower net
figure in the final calculation.
However, the Exempt income is
to be mentioned only for
reporting purposes and should
not be used in any calculation.
26
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Computation of Salary details
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
Loss
under
House
Property due
to
Interest
paid on loans
is not allowed
 In the House property
Schedule the Interest paid
value is not entered. Instead
only the loss figure is
mentioned in the final total.
The totals are re-calculated
while processing the return
from the basic values
provided. If the break up
values are not provided then
the total will be calculated as
zero.
27
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
Loss
under
House
Property due
to
Interest
paid on loans
is not allowed
 The other possibility is that
even if the House Property
Schedule was correctly filled,
the taxpayer has not claimed
the loss in Schedule CYLA.
Therefore, even if loss is
correctly shown in Sch HP,
the adjustment of this loss is
not automatic. It has to be
entered in the first row
against Salary Income as
shown to indicate that this
loss is adjusted against
salary income.
Compiled by CA Avinash
Rawane
23/06/2012
Claim of Loss from House Property
28
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
•Tax payment
is not allowed
• BSR code, Challan number
and date of deposit may have
been incorrect since any
mismatch
may
lead
to
rejection of tax payment. Date
of deposit of challan;
• Compare the details in Form
26AS before filing the eReturn.
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
•Tax payment
is not allowed
• BSR code, Challan number
and date of deposit may have
been incorrect since any
mismatch
may
lead
to
rejection of tax payment. Date
of deposit of challan cannot be
beyond or after date of filing of
return.
29
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
•Tax payment
is not allowed
• Taxpayer should NOT report
tax
payments
made by
Deductors as given in Form 16
or Form 16A as their own
payment under Schedule IT.
This is meant ONLY to enter
tax
payments
DIRECTLY
made by taxpayer himself..
Compiled by CA Avinash
Rawane
23/06/2012
Prepaid Taxes through Challans
30
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
•TDS credit is
not allowed
 Taxpayer should ensure that
the TAN number is valid and as
per the Form 16A issued by
Deductor.
 PAN number of Deductor
should NOT be mentioned in
place of TAN.
 In many cases Deductors may
have given TDS certificate with
certain TAN but submitted TDS
return to Department under
different TAN.
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
•TDS credit is
not allowed
 This should be verified by
cross-checking against the
26AS
statement
for
the
taxpayer which is available
through NSDL or at the e-filing
website.
 Any error by Deductor should
be immediately pointed out and
correction ensured
31
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
•Chapter VI A
deduction
specially 80C
deduction is
not allowed
• While filling in Deductions in
Chapter VI–A, ensure to fill up
the
breakup
showing
all
individual
Section-wise
deductions such as 80 C etc, and
then
mention
the
Total
Deduction claimed.
• At the time of processing, it is
not clear under what section is
the deduction claimed if details
are not given. Since each
deduction has different limits
and eligibility, it is not possible
to allow deduction only from the
total.
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
•Deduction
under
Chapter 80G
or 80IA etc is
not allowed
• Details u/s 80G in Sch 80G
(where the Schedule is
available in the return- ITR 4,
5 and 6) along with correct
totals may not have been
entered, before claiming the
total in Chapter VI-A.
• Similarly, other schedules such
as 80IA/IB etc must also be
filled in where relevant
schedules are in the ITR,
before claiming Ded.
in
Chapter VI-A.
32
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Claim for Chapter VI- A deductions
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
 Tax Rate applied
by CPC is not as
per
rates
for
Female Taxpayers
or Senior citizens
or for firms or
domesticcompany
.MAT is applied
• Entered Gender as
Male or entered
date
of
birth
incorrectly but in
PAN it may be
different.. Check
PAN
33
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
 Tax Rate applied
by CPC is not as
per
rates
for
Female Taxpayers
or Senior citizens
or for firms or
domesticcompany
.MAT is applied
• For assessee filing
return ITR 5, Status
(such as Cooperative
Society, Firm, etc) in
the Gen Information
Portion may not
have
selected
correctly;
Compiled by CA Avinash
Rawane
23/06/2012
Select Gender Correctly
34
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
 Tax Rate applied
by CPC is not as
per
rates
for
Female Taxpayers
or Senior citizens
or for firms or
domesticcompany
.MAT is applied
• Incorrect
status
selection can lead to
taxation at higher
rate or disallowance
on
specific
deduction like 80P,
etc. available only to
co-op. society
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
 Tax Rate applied
by CPC is not as
per
rates
for
Female Taxpayers
or Senior citizens
or for firms or
domesticcompany
.MAT is applied
• Taxpayers filing ITR 6,
the
correct
selection
while opting for item
under Gen Information
relating to ‘If a Domestic
Company’ must be made.
Domestic
companies
MUST NOT select “N” as
it applies for foreign
company and rates of
taxes are higher.
35
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Wrong Selection of Status will also
Impact
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
 Tax Rate applied
by CPC is not as
per
rates
for
Female Taxpayers
or Senior citizens
or for firms or
domesticcompany
.MAT is applied
• Schedule MAT MUST be
filled by all taxpayers
filing ITR 6 irrespective
of whether the book
profit calculations result
in
application
of
provisions of MAT.
• Taxpayer may not have
calculated MAT.
36
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
MAT details compulsory for ITR-6
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• There are many reasons for
variation in Income From
Business:While
entering
Totals (for ex Total Duties
and Taxes etc), breakup is
not given.
• Value entered in Sl no 42
(Depreciation)
(where
Books of Accounts are
maintained) should match
the value in Sch BP:
37
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Figures to match and co-relate
Compiled by CA Avinash
Rawane
23/06/2012
Taxes and duties to be shown
seperately
38
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• Sl no 11 (Depreciation
debited to P&L Account)
Profit Before Tax (and
not Profit After Tax)
should be entered in item
1 of Sch BP;
• Depreciation
allowable
under IT Act u/s 32(1) (ii)
must be as per Sch DEP.
Compiled by CA Avinash
Rawane
23/06/2012
Depreciation problem
39
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• When Schedule Profit and
Loss is filled with a claim for
depreciation but depreciation
amount is either not added
back at item A1 1 in Schedule
BP or details of depreciation in
plant and machinery and other
assets are not filled by the
assessee in Schedule DPM,
DOA and Schedule DEP, this
may lead to disallowance of
depreciation.
Compiled by CA Avinash
Rawane
23/06/2012
Depreciation problem
40
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• Schedule DPM, DOA and
DEP should NOT be left
blank if Depreciation is
being claimed.
• Entering total value of
Depreciation in Sl A12 in
Schedule BP WITHOUT
entering DPM, DOA, DEP
will lead to disallowance
of Depreciation.
Compiled by CA Avinash
Rawane
23/06/2012
Schedule DEP – Claim for Depreciation
must
41
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Schedules Figures to match
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• Where block ceases to
exist, enter correct value
in Cap.Gains / Loss u/s
50. Under NO OTHER
CIRCUMSTANCE should
item 16 be filled. Negative
value, if entered in Sl 16,
implies that block ceased
to exist and then no
Depreciation
will
be
allowed for that block.
42
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Capital Gains figures to be filled
correctly
Compiled by CA Avinash
Rawane
23/06/2012
Capital Gains under Section 50
43
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• Where P&L account
is filled and includes
Deemed income u/s
44AD, 44AE 44AF
etc, ensure that
relevant figures in
A4 and A33 in Sch
BP are correctly
filled
Compiled by CA Avinash
Rawane
23/06/2012
Presentation of Presumptive Profits
44
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• Total of Deemed Income (IF
NON ZERO) under Sections
44AD , 44AE, 44AF, 44B,
44BB, 44BBA, 44BBB, 44D,
44DA, Chapter XII-G and First
Sch of IT Act as per Sl no 33 of
Sch BP) should not be lower
than Sl no 4 of Sch BP.
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• In case nature of business
does
not
include
Tea/Coffee/Rubber, the
net profit or loss from
business or profession
after
applying
Rule
7A,7B, 7C in A37 should
be entered as the same
value as arrived in Sl no
36 of Sch BP
45
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Nature of Business plays Imp role
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business
Computed
Higher
than
the
actual
income
• Net Profit before tax as
reported in the Profit and
Loss Account to match
with the Computation;
• Any additional claim or
disallowances
to
be
separately disclosed.
46
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• Where Schedule OI is
filled with details of
disallowances or amounts
which are to be added
back to income due to the
provisions like 36, 37, 40,
40A, 43B, assessee must
fill in the details in
Schedule BP in arriving
at the income from
Business and Profession.
Compiled by CA Avinash
Rawane
23/06/2012
Disallowance to be stated seperately
47
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Common Errors- Report of CPC
Symptom and issue
Probable reason and Resolution
• Income from
Business is not
correctly
computed
• At
the
time
of
processing
these
disallowances are taken
from Schedule OI and
applied to relevant
items in Sch BP. This
will result in increase of
Income under Business
due
to
these
disallowances.
Compiled by CA Avinash
Rawane
23/06/2012
Losses brought forward from previous
years has not been allowed
• Before claiming adjustments in Sch BFLA,
ensure that Schedule CFL is not left empty.
• The correct breakup of the losses claimed for
setoff must be filled in Sch CFL which alone
will be considered for Schedule BFLA. Direct
entries in Schedule BFLA without any entry
in Schedule CFL will not be entertained, thus
leading to demand due to disallowance of
claim for adjustment of brought forward loss.
48
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Losses Claim Presentation
Compiled by CA Avinash
Rawane
23/06/2012
Losses brought forward from previous
years has not been allowed
 Unabsorbed depreciation loss MUST be included
in CFL against appropriate year or in case it relates
to prior to AY 2002-03 period then it MUST be
entered in the row relating to AY 2002-03. ONLY if
the unabsorbed Depreciation is entered in CFL,
then it will be allowed in Sch BFLA calculation.
 In Sch BFLA, enter all adjustments correctly.
 Do not leave blank as system will not allow
adjustments of brought forward loss unless
claimed in Sch BFLA.
49
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Unabsorbed Loss of Earlier Years
Compiled by CA Avinash
Rawane
23/06/2012
Capital Gain is not correctly
calculated
 Start from full value of consideration in Capital Gain
schedule.
 DO NOT ENTER ONLY FINAL VALUES.
 Enter the correct breakup to arrive at STCG and
LTCG values.
 Do not leave blank any intermediate figures such as
Full Value of Consideration etc.Ensure that the value
entered in Sch CG under LTCG Proviso (option
under proviso to S.112(1) is exercised) is also
correctly entered in Sch SI under LTCG proviso
(Section 22).
50
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Breakup for Capital Gains Must
Compiled by CA Avinash
Rawane
23/06/2012
Capital Gain is not correctly
calculated
 All Capital gain tax calculations are as per special
rates given in Schedule SI. In case this is not
correctly entered then the calculation may differ.
In most cases taxpayers have entered capital gains
in CG schedule at 20% tax rate, but in Schedule SI
entered in code corresponding to 10% rate by
mistake. In such cases tax may be calculated at
both these tax rates.
 Verify that correct quarterly breakups for LTCG
and STCG are provided in
51
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Deemed Capital Gains
Compiled by CA Avinash
Rawane
23/06/2012
Capital Gain is not correctly
calculated
• Sch CG and the total of the quarterly breakups
match with the respective values in Sch SI
(taxable Income after adjusting Min Chargeable
to Tax) after set off of all losses.
• Ensure that the value entered in Sch CG under
STCG 111A is also correctly entered in Sch SI
under STCG 111A (Section 1A) Enter correct
breakup of STCG 111A and other than 111A in
Sch CG.
52
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Fill Up Schedule SP – For Special Rates
Compiled by CA Avinash
Rawane
23/06/2012
Quarterly Break up of Capital Gains
53
6/16/2012
Circular for processing
Returns
Instruction
No.
01/2012
Compiled by CA Avinash
Rawane
[F.NO.225/34/2011-ITA.II],
23/06/2012
dated
2-2-2012
The issue of processing of returns for the Asst. Year 2011-12 and giving credit for TDS
has been considered by the Board. In order to clear backlog of returns, the following
decisions have been taken:
(i) In all returns (ITR-1 , ITR 2, ITR 3, ITR 4 , ITR 5 & ITR-6), where the difference
between the TDS claim and matching TDS amount reported in AS-26 data does not
exceed Rs. One lac, the TDS claim may be accepted without verification.
(ii) Where there is zero TDS matching, TDS credit shall be allowed only after due
verification. However, in case of returns of ITR-1 and ITR-2, credit may be allowed in full,
even if there is zero matching, if the total TDS claimed is Rs. Five thousand or lower.
(iii) Where there are TDS claims with invalid TAN, TDS credit for such claims are not to
be allowed.
(iv) In all other cases, TDS credit shall be allowed after due verification.
Prevention is Better
Compiled by CA Avinash
Rawane
23/06/2012
• Returns generated from private softwares MAY not be
accurate and final;
• Validation Utilities provided by ITD is more or less
control oriented. Final Computation needs to be
physically verified before filing;
• Do not try to over-ride the utilities provided to suit the
same as per the requirements since these are control
based
54
6/16/2012
Some Useful Tips
Compiled by CA Avinash
Rawane
23/06/2012
• Returns are generally prepared by Staff and uploaded,
ensure its correctness before uploading to avoid
Revision and Rectification;
• Ensure sufficient and accurate back up is available for
future requirements.. Not to depend much on the
system, better to have one hard copy;
• Delete the workings created from time to time to
ensure that the latest figures are only available which
were used for the returns filing.``
Any Further help
required
Compiled by CA Avinash
Rawane
23/06/2012
• Call Centre of Income Tax Department available;
• Can
send
e-mail
and
get
reply
efilingadministrator@incometaxindia.gov.in
on
• Help Tools available on the Website of the Income Tax
www.incometaxindiaefiling.gov.in
• Any recommendation to CPC can also be submitted
under Feedback Section
55
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
Representations from BCA, CITC
• Arrears of Demands, matter taken up by our
Professional Associations.. Good work;
• Department has already appointed Nodal Officer
under each CCIT to ensure that the problems are
being solved;
• Letter format released in which the Applications to
be made..
• Full circular and details available on the website
Departments Initiative
Compiled by CA Avinash
Rawane
23/06/2012
• Complaints Cell was made online for filing Complaints
against each of such Demand on the website of the
Dept.. www.incometaxindia.gov.in
• Discontinued within 3 working days due to
overwhelming response;
• Grievances can finally be lodged for action not taken
on the web-portal of the GOI.. www.ppportal.gov.in
56
6/16/2012
Key Benefits
Compiled by CA Avinash
Rawane
23/06/2012
• 24X7 filing;
• No Need of Personal Interference by any one in
processing of the Returns;
• Generally Takes a week’s time to get the rectification
provided details submitted are correct;
• Whether a Boon or Curse for Professionals?
Record Numbers of
Returns Filed
Compiled by CA Avinash
Rawane
23/06/2012
• Income Tax Department has received a record number of 1.64
crores e-Returns in the F.Y. 2012-13. Department thanks
Taxpayers for their overwhelming response.
• From Assessment Year 2012-13, total income of individual or
HUF exceeds Rs. 10 Lakhs to compulsorily e-File;
• Department is planning to give Digital Signature FOC to all the
taxpayers to use them for E-filing and then the process of
sending ITR-V to Bangalore will be discontinued. (Source:
News Item)
• Filing of Tax Audit Report in Form 3CD with Digital Signature
of the Professional may be made compulsory in the near future.
57
6/16/2012
E-Assessments
Compiled by CA Avinash
Rawane
23/06/2012
• New Utilities Compute Tax Liability based on the
information filled.. Acts as self assessment, if verified
properly;
• Days will come in the near future, where we will have
E-assessments;
• Reports of un-reconciled transactions in the Form
26AS submissions and Returns details submitted will
only be the source of scrutiny;
Another Cause of
Concern
Compiled by CA Avinash
Rawane
23/06/2012
• CPC acts as a preserver of the Information.
• Data given by the Assessee shall be preserved for life
time.
• It’s a Data Centre of all the information collected and
information is cent percent reliable;
• The said information may be used for future analysis
and further investigations, search, seizure in future;
58
6/16/2012
Compiled by CA Avinash
Rawane
23/06/2012
E-Filing Season has started
• Utilities for ITR-1,2,3, 4 and 4-S has
commenced for the AY 2012-13;
• Others will be uploaded in the due course
of time;
• Tendency to file it first and see it later on
results in most of errors and omissions,
better be avoided
Forgiveness
Compiled by CA Avinash
Rawane
23/06/2012
Applying computer technology is simply finding the right wrench to
pound in the correct screw.
A mistake in Tax Returns can be corrected by paying penalties and
result in monetary loss but the non-correction of Mistakes made in
Relationship in TIME will ruin your entire LIFE… Correction of Both..
earlier the BETTER
A MISTAKE should always be taken as a Mistake and not as MY
Mistake or HIS Mistake as it leads to difference in the Hearts..Let us
correct it in TIME
59
6/16/2012
Doubts & Querries
Compiled by CA Avinash
Rawane
23/06/2012
• Any Questions
• Thank You
C.A. Avinash V. Rawani
Compiled by CA Avinash
Rawane
119
23/06/2012
Compiled by CA Avinash Rawane
Rawani and Company,
Chartered Accountants
B-206, Hinal Heritage, Patel Wadi, S.V.P.Road,
Near Chamunda Circle, Borivali West,
Mumbai 400092
E-mail : avinash@carawani.com
Website: www.carawani.com
•
The views stated in the material and also discussed are purely of the compiler for the discussions at the
Study Circle and should not be used for any legal interpretation. Any decision to be taken by the user of
this information is to be taken after studying the requisite provisions of the respective Act and specific
applications to particular client. Neither the compiler nor the study circle shall be responsible for the
same.
60