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Neeraj Thakur (Self Practising)     31 October 2013

Advise regarding revised income tax return

Respected Seniors & Friends, whether an assessee file revised itr after received a notice u/s 143(3) (Scrutiny)under Income tax act 1961. Only received a notice u/s 143(3) for the AY 2012-2013. on dt 06.09.2013 the assessee advocate appeared in first hearing and gave power of attorney only. latar assessee told him that he had concealed a fixed deposit of Rs Ten Lac which he made in AY : 2012-2013 which was not showed in his income tax return for the AY 2012-2013 and assessee also disclosed him that he won that rs ten lac in gambling or betting in AY 2012-2013.


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 11 Replies

BAALASUBRAMANNYAMM (Advocate)     02 November 2013

It seems that the assessee was not shown Rs.10 Lakhs even in the revised ITR for the AY  2012-13, after received notice. The said sum was won in the gambling  and thus it should be treated as Income. And hence the Assessee is liable to pay the tax on Rs.10 Lakhs. The IT authoiteis may impose penalty on that amount. 

BAALASUBRAMANNYAMM (Advocate)     02 November 2013

It seems that the assessee was not shown Rs.10 Lakhs even in the revised ITR for the AY  2012-13, after received notice. The said sum was won in the gambling  and thus it should be treated as Income. And hence the Assessee is liable to pay the tax on Rs.10 Lakhs. The IT authoriteis may impose penalty on that amount. 

Neeraj Thakur (Self Practising)     04 November 2013

Sir,

yet only receive notice u/s 143 (3), in its first hearing dt. 06.09.2013 date, ITO accepted Vakalatnama only and said to lawyer that he will send next notice.  Till today nothing received from department. thats why i am asking can i file revised incometax return of that assessee to save panelty atleast.

R RAJAGOPALAN (ADVOCATE)     05 November 2013

YOUR QUERY: yet only receive notice u/s 143 (3), in its first hearing dt. 06.09.2013 date, ITO accepted Vakalatnama only and said to lawyer that he will send next notice.  Till today nothing received from department. thats why i am asking can i file revised incometax return of that assessee to save panelty atleast.

Reply:You can file a 'revised ITR' under Section 139(5), if one year has not expired from the end of the relevant Assessment Year, ie; if the ITR is for the Assessment Years 2012-13 or 2013-14, and if the original ITR had been filed under Section 139(1) or in response to a Notice under Section 142(1).
However there is no assurance that filing the return will save you from penalty proceedings under Section 271(1)(c) for concealment of the income, though you can definitely plead for a lenient view.

Neeraj Thakur (Self Practising)     05 November 2013

Respected Seniors & Friends,

That ITR filed on dt 20.10.2012 for AY 2012-2013 can i revised it to save the panelity u/s 271 (C)

R RAJAGOPALAN (ADVOCATE)     05 November 2013

YOUR QUERY: That ITR filed on dt 20.10.2012 for AY 2012-2013 .can i revise it to save the penalty u/s 271 (C).

Reply: Your case is weak. If the original return itself was filed after the 'due date' prescribed in  Section 139(1), you cannot validly revise itunder Section 139(5).

C. P. CHUGH (Practicing Lawyer)     06 November 2013

Dear Neeraj ji,

As stated your client has not included in his return of income a sum of Rs. 10.00 lac which he has earned by winning from lottery/gambling etc. If that is the case, tax at maximum marginal rate ought to have been deducted at source. Now in these circumstances where the liability of tax has been fully discharged, an income not included in total income by genuine and bona fide mistake or under a bona fide belief  does not necessariy mean an attempt to conceal income.  He can furnish a revised computation of income, disclosing his true income, and discharging his tax liability, if not already discharged, during the course of assessment.

 

it is very unlikely that a penalty for concealment shall be levied upon him.

 

Thanks

Neeraj Thakur (Self Practising)     07 November 2013

Sir,

Its gambling without deduction of 30% TDS.. he totally concealed this fact and made fixed deposit of that amount in bank and at the time of filing of incometax return he did not said this fact to his lawyer.  its result case go fixed and i appeared on dt 06.09.2013 and filed power of attorny to ITO. ITO said me that he will send next notice and till today no notice received yet from income tax department.  kindly suggest me a way how could i save my client. The income tax return filed u/s 44 AD.

R RAJAGOPALAN (ADVOCATE)     13 November 2013

 You  now state: Its gambling without deduction of 30% TDS.. he totally concealed this fact and made fixed deposit of that amount in bank and at the time of filing of incometax return he did not said this fact to his lawyer.  its result case go fixed and i appeared on dt 06.09.2013 and filed power of attorny to ITO. ITO said me that he will send next notice and till today no notice received yet from income tax department.  kindly suggest me a way how could i save my client. The income tax return filed u/s 44 AD.

Reply: As the asessmment has not been finalised yet, the best possible way to help your client is to file the 'revised return' as early as possible and before detection by the Department.

C. P. CHUGH (Practicing Lawyer)     13 November 2013

Dear Neeraj,

It is a simple case of a person earning Rs. 10.00 lac from undisclosed sources and now trying to shield it under Gambling.  

You are not the first or only  professional who are taken as guranteed by the client who disclose to the extent they feel it is necessary.  

It is unfortunate that most of the clients do not come with clean hands for the reasons a) to show their poor financial status  b) to negotiate on professional fee  c) to evade tax.  

Only when they are caught by the department they cry and ask for relief.  

In my personal opinion they do not deserve any leniency and should be treated as per law.

However, being a professional, and after taking a brief, it becomes our responsibility to help him come out of the mess.  

My suggestions are

a) Please inquire further and ask your clients to come clean.

b)Try to find out the exact source of so called income from gambling. It could be outcome of transaction of sale or purchase of immovable property which may lead to another bomb shell.

c) Make a true and fair statement of affairs of  him. Determine actual and factual incomes chargeable to tax for the year and compute tax payable thereon. If any tax is found to be payable after adjusting prior payments of taxes, pay it immediately.

d) on the very first next hearing submit all the details, actual tax computation to the AO before he starts making any inquiry.  

I am not suggesting that Penalty notice will not be issued or either penalty will not be imposed but you would have a better chance for deletion of penalty before the ld CIT or ITAT.

You can also explore the possibilities of approaching Settlement Commission.

 

Thanks

 

Bharat Bhushan Goel (Proprietor)     18 January 2014

Dear senior members

I am having a query regarding filing of Revised ITR  u/s 139(5) for AY 2012-13 and AY 2013-14 when i have received intimation of processing the same under section143(1). I think the above intimation is a temporary assessment order. I want to claim refund of   tax rebate u/s 80E for the above years. Can i do so now.  I will be thankful if my seniors can answer me.

 

Bharat Goel


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