How to use Digital Signature for e-filing Income Tax Return?

Everything has gone online since the advent of computerisation: newspapers have been replaced by e-newspapers, greeting cards have been replaced by e-greeting cards, and income tax forms have been replaced by e-income tax returns.

The first two examples were simple to computerise because authentication is not as important as it is when filing an income tax return. All proper information must be included in the Income Tax Return, and the individual completing it signs a declaration that all information provided is truthful and accurate to the best of his knowledge.

In the event of paper filing, signing a statement is simple since the declarant can easily sign the declaration. But how can we sign this declaration while submitting documents online???

This was one of the reasons why the government took so long to implement the online filing of income tax returns, but now that technology such as Digital Signature Certificates is widely available, completing an income tax return online is as simple as clicking a button.

What is a Digital Signature Certificate?

A Digital Signature is a Certificate that proves the digital message or document’s validity. The presence of a person’s Digital Signature implies that that person accepts the contents of the electronic message. Each person is assigned a unique Digital Certificate that aids in determining which Digital Signature belongs to whoever.

A digital signature verifies the authenticity of electronic documents in the same way as a handwritten signature verifies the authenticity of printed papers. This signature cannot be falsified, and it certifies that a designated individual wrote or agreed to the document to which it is attached. The recipient of a digitally signed message can confirm that the message came from the person whose signature is on the document and that it has not been altered since it was signed, either intentionally or accidentally. Also, a document’s signer cannot later claim that his or her signature was faked. In other words, digital signatures allow for the “authentication” and “non-repudiation” of electronic messages, ensuring that the recipient is aware of both the sender’s identity and the message’s integrity.

Digital certificates are often issued with a one-year or two-year validity period. It includes the cost of the medium (a UBS token, which is a one-time payment), the cost of the Digital Certificate issuance, and the cost of renewal once the validity term has expired.

Applicability of Digital Signature while uploading Income Tax Return

In India, Digital Signatures are issued by a registered certifying authority and have the same legal status as physical signatures under the Information Technology Act, 2000.

Digital Signatures are commonly used for statutory and other filings, such as Income Tax Returns, that must be signed at the time of submission. In case you are furnishing these Returns online, there are 2 ways of signing the Income Tax Return:

• Using Digital Signatures
• Using Handwritten Signatures (i.e. taking a printout of the Return uploaded online, signing it and then manually sending the paper return to the Income Tax Office in Bangalore)

Exception: Vide notification dated 9th July 2010 amending Rule 12, the CBDT has made it mandatory for all Companies filing ITR-6 to digitally sign the I-T return for AY 2010-11.

Registering Digital Signature Certificate on Income Tax Website

1. On the Income Tax e-filing website, www.incometaxindiaefiling.gov.in, log in with your User-id and Password.
2. Click Digital Signature under the My Account tab.
3. Click “Select your pfx file certificate” after selecting the proper type of DSC (pfx or USB token).

If the Income Tax Assessee is an individual or a family unit, the email address on his Digital Certificate must match the email address on his e-filing online profile. In the case of non-individuals such as firms, companies, and so on, the person holding the Digital Certificate must be a Director/Partner on the Firm/Key Company’s Person Schedule.

Uploading Income Tax Return Online

1. Prepare your Income Tax Return and then Generate the XML File and save it on your computer.

2. Submit your user-id and password to access your account at https://incometaxindiaefiling.gov.in/portal/login.do

3. Click Submit Return and then select the assessment year.

Select the type of Digital Signature after selecting the Income Tax Form Name, and then upload your Income Tax Return using the Digital Signature Certificate.