late filing of income tax returns

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Querist : Anonymous

Querist : Anonymous (Querist)

23 July 2011 Hi,
My client is an engineer. He filed tax returns upto the Assessment Year 2004-05.
He suffered a major setback in his profession due to unexpected problems in his personal life. Though he tried to continue to carry on his profession,he quit filing tax returns. His profession improved in the following years and the
TDS on his income exceeded Rs.70,000/-
for the assessment year 2011-12. Though he
did not realise the importance of filing tax returns till date, his customers (banks,government companies,etc.,) have started insisting him to submit tax returns.
Now the client approaches me after 7 long
years and wants to get his tax returns filed for all the years from asst.year 2005-06. He has paid advance tax of Rs.50,000/- during the asst.year 2005-06.
His income was far less and his excess tax payment was Rs.30,000/- for the asst.year 2005-06. My queries are:

1) Can I file tax returns of my client for the eight assessment years belatedly?

2) Can the assessee adjust the excess tax paid during the asst.year 2005-06 with the tax liability of the asst.year 2006-07?

3) It is known that the belated retuns can be filed within two years from the end of the relevant financial year. In such a case, the question is :

a) Should I not file tax returns from the asst.year 2005-06 to 2007-08 and pay taxes?
b) What will the income tax department do?
Would they reject such returns? Or would they accept and treat them as lodged? Or
would they consider such past due returns as though not filed?

Please advise me what should I do? How can I help my client who is willing to pay taxes and make good his past mistakes?

Thank you.
Kumar

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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23 July 2011 1) Prima facie NO. But if your client is entitled for refund u may apply to the commissioner of Income tax under section 119 of the Income tax Act,1961 seeking to give a direction to the concerned ITO to accept the return. If u succeed, file the returns from assessment year 2005-06 to 2009-10.
2) Assessee can't make such adjustments since there is no provision in the above said act.
3) a) Can't file voluntarily. But subject to the satisfaction of my observation in clause (1) above returns can be filed.
b) Since voluntary filing is barred by time ,department will not accept the returns for the assessment years 2005-06 to 2009-10.

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