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December 12, 2020

Request for extension of Due Dates for Tax Audit and ITR to 31 March 2021 by Chamber of Tax Consultants

by CA Shivam Jaiswal in Income Tax

Request for extension of Due Dates for Tax Audit and ITR to 31 March 2021 by Chamber of Tax Consultants

Extract of the Request from Chamber of Tax Consultants

The Chamber of Tax Consultants, established in 1926, is one of the oldest non-profit organizations of tax practitioners of  Mumbai, having   Advocates, Chartered Accountants and Tax Practitioners as its members. Many senior tax professionals who regularly appear before ITAT, high courts and the Supreme Court are its Past Presidents. We have been making regular representations before various government agencies.

The Chamber regularly takes up initiatives to act as a bridge between stakeholders and concerned regulatory  bodies in order to convey  and  help in resolving genuine grievances or effectively implement the laws.

Today, we come forth with a  request  of  extending  the due dates of  Tax  Audit and Transfer Pricing Audit to February 28, 2021 and Income Tax Return filing to March 31, 2021. Our request is based on 2 major pillars:

1.The Covid-19 Pandemic

We commend the Government for the  way  the  pandemic  has  been  efficiently  tackled during the various phases of lockdown and unlock.  We also  appreciate  the  extension provided for tax audit and income tax return filing up to December 31, 2020.

But, while the country has been unlocked as a whole, several state governments have individually imposed various restrictions based on the spread  and  severity  of the  Corona virus in the state. Inter-state movement is restricted to an extent  in  certain  states.  The intra-state movement is also restricted. States like Gujarat, Rajasthan, Punjab, Himacha l Pradesh, Madhya Pradesh have imposed night  curfew.  In a city like Mumbai,  whose lifeline is its  local trains, the metros  and  local  trains  are  not  running till date. 

The transport via public buses is not easily accessible.   Nation-wide, there is  still   a huge  fear of getting infected among  the people due to which they prefer not travelling at all or restrict it to the vicinity of their homes. Due to this  restriction  of  movement, several industries and  private offices  have still not started  fully functioning and are still struggling to function at a certain level  of normalcy.  This also includes the offices of the Chartered Accountants and Tax Practitioners.

Due to this, the details required for completing audits and carrying on tax  audit and filing the return of income are not being received promptly and  thus the audits cannot be efficiently performed.

Also travelling to the place of audit without availability of trains is very difficult for the professionals and their staff in a city like Mumbai as well as the curfews imposed  have curtailed work hours in other cities.

Several Chartered Accountants, Tax Practitioners and there  staff  have  been infected  and have not been able to  work  for  minimum  of 14  days.  Also  visiting   any  audit   place  all the more exposes them to the virus making them prone to get infected.

In addition to this, the senior citizens are advised to stay at home.  This includes  senior professionals and senior  assesses  who  following  this  advice  will  not  be able  to comply with the existing due dates.

These hindrances are  making  it very difficult  for the assessees,  the  Chartered  Accountants and the Tax Practitioners to comply  with even the extended due dates.

2. Delay in release of utilities and instructions

The utilities  for the income tax return were made available only June’20   onwards instead of April’20.

Following is the chart showing the release date and the latest update date:

Sr. No.Income Tax ReturnSchema Release DateSchema Updation DateUtility Updation Date
1ITR 1June 2, 2020September 9, 2020December 1, 2020
2ITR 2June 26, 2020November 4, 2020December 3, 2020
3ITR 3July 31, 2020November 9, 2020December 1, 2020
4ITR 4June 5, 2020October 15, 2020December 1, 2020
5ITR 5August 25, 2020November 18, 2020December 3, 2020
6ITR 6Septembr 22, 2020November 22, 2020December 3, 2020
7ITR 7September                           3, 2020December 8, 2020December 8, 2020
8Form 3CA-3CDNovember 4, 2020
9Form 3CA-3CDNovember 4, 2020
10Form 3CEBNovember 4, 2020

Usually, the income tax returns must be released in the month of April but  due  to the  pandemic, the release of the returns have  been delayed on an average by 4 months. Additionally, even after release, they have been constantly updated.

Although the utilities were released as on the abovementioned  dates, the 700+ paged instructions for filing the  return of income were released  only  on October 23, 2020. These instructions were further revised on November  25, 2020 i.e. just a month before the due date of filing of income tax return, not giving the professionals and assessees enough time to even take a note of the most important points.

These are indeed unusual times and when the dates were last extended  one  had expected a reasonable resumption of acitvities – however the second predicted  phase  of COVID spread resulted in a slow unlockdown compared to what was expected and hence the earlier date of December  end which seemed reasonable at one time is now looking like an impossibility.

With due respect to the above difficulties faced by the assessees  and  the professionals, we request your Honour to take them into  consideration and extend the due dates for Tax Audit and Transfer Pricing Audit to February  28, 2021 and Income Tax Return filing to March 31, 2021. The entire fraternity of taxpayer and professionals will highly appreciate if this is done  soon enough   (i.e.  well  in  advance)  to allow them to get a clarity.

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