Master in Accounts & high court Advocate
9615 Points
Posted on 24 January 2025
When filing an updated return (ITR-U), if a refund arises after payment of a penalty, you'll need to ensure that the refund is nullified.
Since refunds are neither allowed nor carried forward in ITR-U, you can follow these steps:
Step 1: Determine the Refund Amount Calculate the refund amount that arises after paying the penalty in the ITR-U.
Step 2: Pay Additional Tax or Interest To nullify the refund, you can pay additional tax or interest. This can be done by: - _Paying self-assessment tax_: If you have any other tax liabilities, you can pay self-assessment tax to offset the refund amount. - _Paying interest under Section 234B or 234C_:
If you have any interest liabilities under Section 234B or 234C, you can pay the interest to offset the refund amount.
Step 3: File a Revised ITR-U After paying the additional tax or interest, file a revised ITR-U to reflect the changes. Ensure that the refund amount is reduced to zero.
Step 4: Verify the Refund Status Once you've filed the revised ITR-U, verify the refund status on the income tax department's website to ensure that the refund has been nullified.
By following these steps, you can ensure that the refund arising from the payment of penalty in the ITR-U is nullified.