17 February 2016
Dear Sir, An assesse had received notice from IT Dept. for making compliance for A.Y. 2013-14. In that year his Gross Total Income is Rs. 3.00 Lacs and deduction u/s. 80C is Rs. 1.50 Lacs. So his Total Income is Rs. 1.50 Lacs. In Compliance sheet they ask for reason of non filing and there are options like 1) No Taxable Income, 2) Others. Can he select the option No taxable Income in his case or not.
Please suggest as early as possible. your valuable reply would be helpful.
17 February 2016
he was supposed to file the return..kindly read the provisions for application of 139(1). Income before providing for Chapter VIA deductions is to be considered.
20 February 2016
Limit for deduction u/s 80C was Rs. 1,00,000/- so calculate Net total income properly after considering proper deduction and limits. If the net total income is below taxable limit, then select option as "income not taxable".
21 February 2016
Since ITR was supposed to be filed, if the total income before deductions under Chapter VI A exceeded the minimum amount exempt from tax, the person is an assessee in default.
In A.Y. 2013 - 14 the minimum income exempt from tax was Rs.2.00 L and deductions under Section 80 C was Rs.1.00 L, there was no tax liability but the assessee was liable to file ITR declaring his income and showing tax payable as NIL. Therefore in the compliance form you have to opt for the reason - OTHERS. As and when explanation is sought you can clarify your misunderstanding of the law - and any way since you have not evaded payment of any tax, there will be no additional tax / interest / penalty liability on you.
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