Analysis of Defective returns u/s. 139(9)

In the recent times, a lot of notices u/s. 139(9) have been issued to the assessee regarding the defects being detected in the furnished returns of income and the time being given  by the Department to rectify the same. So, lets analyse the provisions of Section 139(9) and discuss its implications and procedures to rectify the defects.

What is Defective Return and time limit to rectify the defects?

The Income tax return being filed by the assessee shall become defective on the following grounds, it is to be worth mentioned that the below mentioned list is inclusive and not exhaustive:-

• The TDS claimed in the Income tax return does not match with the TDS reflected in the Form 26AS
• The challan entered by the assessee for the tax payment is entered incorrectly
• Commission income returns have been filed under ITR 4 i.e. presumptive income
• Particulars of the returns have been incorrectly filed

In that case, whenever the assessing officer founds the returns defective, he shall intimate the defects to the assessee and give him 15 days to rectify the defects. On the request of the assessee, the 15 days limit can be increased by the assessing officer.

If the A.O. does not responds to the application being filed by the assessee regarding the extension of time to rectify the defects, then the conclusion is that the extension of time has been granted to the assessee to rectify the defects.[Indus Motor Co. Ltd. vs. CIT (2009) 116 ITD 207 Cochin]

If the assessee does not rectify the defects within 15 days or the extended time given, then the A.O. shall treat the return as invalid and all the other provisions of the Income tax act shall apply as if no return has been furnished.

Procedure to rectify the defects

The procedure to rectify the defects is as follows:-

• The assessee should choose the assessment year and download the relevant form utility from the Income tax website.
• In the downloaded form utility, opt for the option “In response to a notice under section 139(9) where the original return was a defective return” and fill the communication reference number of the communication received under section 139(9) along with the date of receipt of the communication and acknowledgment number of the original return.
• The assessee should rectify the defects as mentioned in the communication or complete the income tax return as you normally would.
• The assessee should also take into note that if the changes lead to change in the income and / or taxation under other heads of income, then the return shall be filed as revised return not as a corrected return as per the provisions of Income tax act.
• Generate the XML file and upload the file on the Income tax website under the option “e-file in response to notice under section 139(9)” under the “e-file” section and upload the rectified XML file after agreeing / disagreeing to the defects.
• On the successful submission, an acknowledgment shall be generated on the Income tax website.