The seventh proviso to Section 139 was inserted by the Finance Act, 2019, which provided for certain criteria which mandated the filing of income-tax returns even when the individual’s income is less than the basic exemption limit. Such criteria include deposition of Rs one crore or more in a current account, expenditure exceeding Rs 2 lakh for foreign travel, or an amount exceeding Rs 1 lakh for electricity consumption during the year.
Now, vide Notification No. 37/2022, CBDT has notified a new Rule 12AB which prescribes additional conditions which mandate the filing of Income-tax returns despite the fact that income is below the basic exemption limit, says Ms Goel. These additional criteria are:
- Total sales/turnover/gross receipts in the business exceed Rs 60 lakh during the previous year
- Gross receipts in profession exceed Rs 10 lakh during the previous year
- Aggregate TDS/TCS during the year is Rs 25000 or more (In the case of senior citizens increased limit of Rs 50,000 shall be applicable)
- Deposits in saving bank account is Rs 50 lakh or more during the previous year.
This will be applicable for the ITR filing of FY 2021-22 ( AY 2022-23), says Abhishek Soni, CEO, Tax2win.in, an ITR filing website.
Ms Goel adds: “The government is aiming to capture all the assessees incurring high-value transactions but not filing income tax returns since taxable income is less than the basic exemption limit. Such a move will definitely help in increasing the number of income tax returns filed in the country and thus bring more transparency to the system.”