Library / Income-tax Act, 2025: The Professional's Master Guide
38. PAN and Return of Income (Sections 262 to 267)
38.1 Who must file
- Companies and firms: always, even with loss or nil income.
- Individuals and HUFs: if total income before deductions exceeds the basic exemption limit, or on specified transactions (electricity above Rs. 1 lakh, foreign travel above Rs. 2 lakh, current account deposits of Rs. 1 crore or more), or if they hold foreign assets.
38.2 Due dates for Tax Year 2026-27
Taxpayer | Due date |
|---|---|
Individuals, HUFs without business income (ITR-1, ITR-2) | 31 July 2027 |
Non-audit business or profession cases (ITR-3, ITR-4) | 31 August 2027 |
Audit cases, companies, partners of audited firms | 31 October 2027 |
Transfer pricing cases | 30 November 2027 |
Belated return | 31 December 2027 |
Revised return | Within 12 months from end of tax year (up to 31 March 2028), subject to conditions |
38.3 Updated return (section 267, old 140B)
An updated return can report missed income within 48 months from the end of the relevant period, with additional tax. It cannot reduce tax, increase refund or increase loss.
Filed within | Additional tax on tax plus interest |
|---|---|
12 months | 25% |
24 months | 50% |
36 months | 60% |
48 months | 70% |
Illustration 143: Missed FD interest Nisha (30% slab) missed FD interest of Rs. 1,00,000. Tax with cess Rs. 31,200 plus interest, say, Rs. 5,000 = Rs. 36,200. In the first window, additional tax = 25% = Rs. 9,050. Total Rs. 45,250. |
38.4 Which return form?
Form | Who uses it |
|---|---|
ITR-1 | Resident individuals (not RNOR) with total income up to Rs. 50 lakh from salary, up to two house properties, other sources, agricultural income up to Rs. 5,000, and LTCG under section 198 up to Rs. 1,25,000 without brought forward losses |
ITR-2 | Individuals and HUFs without business or professional income (capital gains, foreign assets, NRIs, directors, unlisted shares) |
ITR-3 | Individuals and HUFs with business or professional income, including F&O traders and partners of firms |
ITR-4 | Resident individuals, HUFs and firms (not LLPs) using the presumptive schemes with income up to Rs. 50 lakh |
ITR-5 | Firms, LLPs, AOPs, BOIs, local authorities, co-operative societies |
ITR-6 | Companies, other than those claiming exemption as non-profit organisations |
ITR-7 | Non-profit organisations, political parties, research associations, institutions filing under the exemption provisions |
38.5 Filing, verification and correction
- Verification: a return filed electronically must be verified within 30 days (Aadhaar OTP, net banking, digital signature, or signed ITR-V by post). If it is verified after 30 days, the date of verification is treated as the date of filing, with all the consequences of late filing; a return never verified is treated as not filed.
- Defective return: if the department finds a return defective (for example, audit report not filed), it gives an intimation; the defect must be removed within 15 days (or extended time), failing which the return is invalid.
- Belated return: can be filed up to 31 December after the tax year (subject to fee), but losses (other than house property loss and unabsorbed depreciation) cannot be carried forward.
- Revised return: can correct omissions or wrong statements in the original or belated return, within 12 months from the end of the tax year, subject to the prescribed conditions.
- Updated return: see the earlier chapter; not allowed where a search or survey has been initiated, where an assessment or reassessment is pending or completed for that year, or where it results in a loss or lower tax.
38.6 AIS, TIS and Form 168
Before filing any return, compare the draft with the Annual Information Statement (AIS), the Taxpayer Information Summary (TIS) and Form 168. The AIS captures interest, dividends, securities transactions, mutual fund transactions, foreign remittances, property purchases, GST turnover and more, reported by banks, registrars and other entities through statements of financial transactions (Form 165). Where AIS information is wrong, submit feedback on the portal instead of ignoring it, because mismatches trigger automated notices.
Illustration 144: AIS mismatch AIS shows interest of Rs. 1,80,000 from a bank, but Sneha's books show Rs. 1,20,000 because Rs. 60,000 relates to her mother's FD with Sneha as the first holder by mistake. Sneha should submit feedback on the AIS that the income belongs to her mother, and her mother should report it. Otherwise Sneha will receive a mismatch notice. |
Chapter summary • Choose the right ITR form; verify within 30 days. • Due dates: 31 July, 31 August (non-audit business), 31 October (audit), 30 November (TP). • Updated returns allowed within 48 months with additional tax. • Always reconcile with AIS and Form 168 before filing. |
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