No penalty should be levied U/S 234F if GTI is less than Slab Limit

Penalty for Not filing Income Tax Return,No penalty should be levied U/S 234F if GTI is less than Slab Limit,penalty U/S 234F,Section 234F

No penalty should be levied U/S 234F if GTI is less than Slab Limit : Finance Act 2017 introduced Section 234F which mandated penalty in case of non-filing of return. There is a confusion among stakeholders whether penalty would be levied u/s234F if GTI is less than slab limit or not.

No penalty should be levied U/S 234F if GTI is less than Slab Limit

The Extract of234Fof Income Tax Act 1961 is given below for your referance:

Fee for default in furnishing return of income.

234F.(1) Without prejudice to the provisions of this Act, where a person required to furnish a return of income undersection 139, fails to do so within the time prescribed in sub-section (1) of the said section, he shall pay, by way of fee, a sum of,

(a) five thousand rupees, if the return is furnished on or before the 31st day of December of the assessment year;

(b) ten thousand rupees in any other case:

Providedthat if the total income of the person does not exceed five lakh rupees, the fee payable under this section shall not exceed one thousand rupees.

(2) The provisions of this section shall apply in respect of return of income required to be furnished for the assessment year commencing on or after the 1st day of April, 2018.

The Extract of139 of Income Tax Act 1961 is given below for your referance:

Return of income.

"139.(1) Every person,

(a) being a company or a firm; or

(b) being a person other than a company or a firm, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax,

shall, on or before the due date, furnish a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed "

"Provided alsothat every person, being an individual or a Hindu undivided family or an association of persons or a body of individuals, whether incorporated or not, or an artificial juridical person, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year, without giving effect to the provisions of clause (38) ofsection 10orsection 10Aorsection 10Borsection 10BAor Chapter VI-A exceeded the maximum amount which is not chargeable to income-tax, shall, on or before the due date, furnish a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed." Conclusion A close reading of Section 139(1) states thatevery person, being an individual or a Hindu undivided family or an association of persons or a body of individuals, or an artificial juridical person would be liable to file ITR if his gross total income is more than slab limit. Further it is not necessary foran individual or a Hindu undivided family or an association of persons or a body of individuals, or an artificial juridical person to file ITR if their Gross total Income is less than Slab limit. Authors Opinion : Where there is no compulsion of filing ITR , question of penalty does not arise. Section 234F levies penalty only in those cases where ITR filing was mandatory. No penalty should be levied U/S 234F of Income Tax Act 1961 in case of late filling of return if Gross Total Income is less than slab limit.  

Tags:Penalty for Not filing Income Tax Return,No penalty should be levied U/S 234F if GTI is less than Slab Limit,penalty U/S 234F,Section 234F