Claimed exemption under wrong section

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A taxpayer mistakenly claimed capital gains tax exemption under Section 54EC when it should have been Section 54 for constructing a new house. Attempts to correct this via an ITR-U are failing due to an error stating 'Tax payment cannot be Zero'. The advice given is to add additional income to create a tax liability greater than zero, which should allow the updated return to be filed. If issues persist, raising a grievance is recommended.

Niharika Sharma

Niharika Sharma (Querist)
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05 July 2024 I have a client whose CA filed his return back in FY 2021-22, when he sold a residential property. He was supposed to construct another house with the sale proceeds and therefore he invested the same amount in the Capital Gains Savings Scheme of a Public sector Bank. Therefore, the Exemption should have been claimed under section 54. But his CA filed the exemption under Section 54EC, which is, I believe, is completely irrelevant as the he did not invest in NHAI Bonds or such other Bonds as specified under Section 54EC. I am trying to file an ITR-U to rectify the error but I can't as it shows an error that 'Tax payment cannot be Zero'. What can I do save this person from getting under scrutiny?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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05 July 2024 Show some additional income and pay some tax then only your updated return will be accepted.

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Niharika Sharma

Niharika Sharma (Querist)
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05 July 2024 thankyou sir for the help!

Niharika Sharma

Niharika Sharma (Querist)
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06 July 2024 I tried adding the income to the Other income, it still generates the same error that 'you are expected to have net payable amount more than zero to make tax payable u/140B". though, my new tax liability stands at around 3k. please help, as it is not generating Json.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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06 July 2024 Try it today with add some more income so that tax liability is 5000 if the same problem persists raise grievances it will be solved.

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