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Quick Summary
Seventh Proviso to Section 139(1) of the Income Tax Act, 1961, added with effective from 1st April 2020.
It mandates that certain individuals must file an income tax return even if their total income is below the basic exemption limit and have engaged in specific high-value transactions.
Who Requires to File an ITR Under the Seventh Proviso?
The Seventh Proviso to Section 139(1) applies to:
- Individuals
- Bodies of individuals (incorporated or not)
- Hindu Undivided Families
- Artificial juridical persons
- Associations of persons
When It Is Mandatory?
Filling is mandatory even if the total income is below 2.5 lakh if they have engaged in specific high-value transactions, such as:
- Total deposits in one or more current accounts maintained with a banking company or a co-operative bank exceed Rs 1 Cr.
- Electricity bill for a financial year exceeds Rs 1 Lakh.
- Expenses incurred in a financial year exceed Rs 2 Lakh for travel to a foreign country.
Other Conditions
- If total income from profession is more than Rs 10 lakh.
- If you have made any loss from income from house property, capital gains, income from business and profession.
- If you hold assets, beneficiary of any assets and has signing authority in any account outside india.
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FAQ :
The Seventh Proviso to Section 139(1) of the Income Tax Act, 1961, mandates that certain individuals must file an income tax return even if their total income is below the basic exemption limit, provided they have engaged in specific high-value transactions.
This proviso applies to individuals, bodies of individuals, Hindu Undivided Families, artificial juridical persons, and associations of persons.
Mandatory filing is required if you deposit over Rs 1 crore in bank accounts, pay over Rs 1 lakh for electricity bills, or spend over Rs 2 lakh on foreign travel in a financial year.
Yes, filing is mandatory if your total income from a profession exceeds Rs 10 lakh, if you have losses from house property, capital gains, or business/profession, or if you hold foreign assets or have signing authority in foreign accounts.
Yes, filing is mandatory under the Seventh Proviso even if your total income is below Rs 2.5 lakh, provided you meet the criteria for specific high-value transactions.
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