As we all know if we had paid excess taxes than our income tax liability either by TDS/ TCS or in the form of Advance Tax, we can claim the refund of such excess tax paid by filing Income Tax Return u/s 139. The last date of filing of Income Tax Returns u/s 139(1) is July 31st of the relevant Assessment Year.
However, Belated return can be filed under section 139(4) by the end of the relevant assessment year i.e. 31st March. So, if you want to claim a refund of the excess taxes paid, you must file your ITR maximum by 31st March to avoid the loss of your refund. But, there are many cases where the assessee missed this second deadline also and struggling to get their refund from the department.
So, In this article, we will discuss in detail how you can get your old Income Tax Refund related to the previous year.
Section 119(2)(b) of the Income Tax Act, 1961:
Section 119(2)(b) confers the power to Central Board of Direct Taxes by which board if consider necessary to avoid genuine hardships of the assessee may authorize any Income-tax authority, not being Commissioner (Appeals) to admit an application for granting an exemption or any other relief and to deal in accordance with law.
So, board by using its power under this section issued a circular [CIRCULAR 9/2015 [F.NO.312/22/2015-OT], DATED 9-6-2015 ] which authorized Income Tax authorities to accept Income tax return even after their due dates have been passed and to grant a refund to the assessee pertaining to prior years. So, the solution to our problem is hidden in this circular and now I will guide you what has been mentioned in this circular.
CIRCULAR 9/2015 [F.NO.312/22/2015-OT], DATED 9-6-2015:
This circular is all about Condonation of delay in filing a refund claim or claim of carrying forward of losses. Board has empowered various Income Tax authorities through this Circular to admit claims of the assessee even after the due date of return has been passed. This delegation of authority has been given to various authorities depending upon the number of claims.
Claim up to Rs. 10 Lakhs:
Board has vested the power to Principal Commissioners of Income-tax/ Commissioners of Income Tax (Pr.CsIT/ CsIT) for accepting or rejecting the application or claims having value up to Rs. 10 Lakhs for any one assessment year.
The claim exceeds Rs. 10 Lakhs but not more than Rs. 50 Lakhs:
Board has vested the power to Principal Chief Commissioners of Income-tax/ Chief Commissioners of Income Tax (Pr.CCsIT/ CCsIT) for accepting or rejecting the application or claims having a value exceeding Rs. 10 Lakhs but not more than Rs. 50 Lakhs for any one assessment year.
Claim more than rs. 50 Lakhs:
Board has vested with the powers to accept or reject the application or claims having a value of more than Rs. 50 Lakhs for any one assessment year. It means an application in which the value of the claim is exceeding Rs. 50 Lakhs shall be considered only by the board.
Time Limit to apply for the condonation:
You can file your condonation application of claims of refund or losses within six years from the end of the relevant assessment year. No application shall be admitted by any authority mentioned above beyond this period, even the board itself does not have any authority to admit application after this time period.
As directed in the circular Any application made for condonation of delay must be disposed of by the respective authority within 6 months from the end of the month in which the application has been received, as far as possible.
Exception for Time limit of 6 years discussed above:
There are two exceptions taken into consideration in this circular in which this time limit of 6 years may be crossed and still the application would be accepted. Two exceptions are:
- In the case where the refund has arisen consequent to any order of the court then the period during which the proceedings were pending before any competent court shall be ignored while calculating the period of six years. Provided that, the application for condonation must be submitted within six months from the end of the month in which the decision of the court has been issued or from the end of the financial year whichever is later.
- In case a person has invested in 8 % Savings (taxable) Bonds, 2003 issued by government of India opting for cumulative interest scheme at maturity but the intermediary bank at maturity deducted tax on whole amount of interest without being apportioned that interest over various financial years involved, in that case also this time limit of six years does not apply.
Consideration before accepting/rejecting any application:
The power of acceptance/ rejection delegated to various authorities must be exercised after considering the following conditions:
- Before considering the case u/s 119(2)(b), it must be ensured by the authority that the income or loss declared is correct and genuine and also there was a genuine hardship on merits.
- The respective authority is empowered to direct the jurisdictional Assessing officer to take necessary actions or inquiries to check that the case is in accordance with the provision of the act to ascertain the correctness of the claims
How to file Return u/s 119(2)(b):
Return under this section shall be filed electronically by logon to the e-filing portal using your login id and password.
So, to conclude our question that whether it is possible to claim a refund of previous years, I must say YES but you must take care of the time limits mentioned above. Also, If you need more clarity or any support in process related to claim of refund you can contact us anytime.