Will ITR due date get extended? Finance Minister resists pleas of extension
An income tax return (ITR) is basically a document that is filed as per the provisions of the Income Tax Act, reporting one’s income, profits and losses and other deductions as well as details about tax refund or tax liability. The original due date for submitting ITR for assessment year 2020-2021 relevant to financial year 1st April 2019 to 31st March 2020 was 31st July 2020. However, the same was extended due to pandemic COVID-19.
Extension of Due Dates due to COVID 19
The economic impact of the 2020 coronavirus pandemic in India has been largely disruptive. The lockdown though necessary has led to a disastrous impact on the economy. With an ever-increasing corona virus cases, lockdown was considered as an only solution to flatten the curve. However, the measures which were implemented to avoid a human disaster, have in turn led to the birth of several issues such as unemployment, recession, hindrance to economic growth, financial instability and so on.
The Government of India announced a variety of measures to tackle the situation, from food security and extra funds for healthcare and for the states, to sector related incentives and tax deadline extensions. With the ongoing COVID -19 pandemic a lot of income tax due dates were extended. One of these extension benefits were also provided to the due date of filing income tax returns.
The deadline to file ITR by individual taxpayers for FY 2019-20 ends on December 31, 2020, while the same for taxpayers whose accounts require to be audited is January 31, 2021.
Therefore, ITR due dates for FY 2019-20 are as follows:
|Category of Taxpayer||Due Date|
|Individual||31st December, 2020|
|Body of Individuals (BOI)||31st December, 2020|
|Hindu Undivided Family (HUF)||31st December, 2020|
|Association of Persons (AOP)||31st December, 2020|
|Businesses (Requiring Audit)||31st January, 2020|
|Businesses (Requiring TP Report)||31st January, 2020|
Pleas submitted to Finance Minister to further extend ITR deadline
- Multitude of pleas were being sent to Union Finance Minister Nirmala Sitharaman for further postponing the ITR due date.
- The postponements were sought mainly because internal trade remains disturbed due to COVID-19.
- Several associations, trade unions, professionals and Parliamentarians sought staggered extensions in deadlines for various returns.
- They wanted the due date for filing annual returns for GST postponed to 31st January, 2021 and for Income Tax returns to 31st March, 2021.
- The social media was also flooded with pleas for postponement, with former Commerce Minister Suresh Prabhu also writing to Union Finance Minister Nirmala Sitharaman in this respect.
Finance Minister resists pleas to further extend ITR deadline
- The Union Finance Ministry has blatantly refused the petitions to postpone the last date for filing several returns, including for income tax for assessment year 2020-21.
- The North Block has joined the battle of perception with at least six posts daily from the official Finance Ministry Twitter handle urging tax payers to submit the returns by 31st December.
- This persuasion is accompanied by statistics of IT returns filed.
- For instance, the Finance Ministry in its fourth post on Monday reported that 7.10 lakh IT returns were filed till 5 pm. It put the cumulative figure till that hour at 4.23 crore for assessment year 2020-21.
Further deadlines that may not be extended by the Finance Ministry
- The ministry is also not disposed to defer its decision to make 1% payment of tax liability in cash in GST despite pleas from a pro-government traders’ organisation.
- The new rule 86B that makes it mandatory for companies with a monthly turnover of over Rs 50 lakh to pay at least 1% of their net Goods and Services Tax (GST) liability in cash will not impact small businesses and the cash payment is calculated on the basis of tax component only
- The Confederation of All-India Traders (CAIT) cited enhanced compliance burden and financial obligation for traders in seeking a deferment but the government has stated that this provision will curb fake invoicing.
In conclusion, it does not seem that the due date of filing Income Tax Returns for AY 2020-21 will extend further from 31st December, 2021. Therefore, taxpayers are urged to file their ITR’s before the said due date. In doing so, one can avoid late fees of Rs 10,000 and the chances of having ‘best judgement assessment’ conducted on their income.
As per recent news Bombay High Court- Hearing of the writ petition for extension of ITR and Audits has been Adjourned to 31.12. 2020 . Income Tax Department to seek instructions.
It would be interesting to know if Income Tax Department will extend on last date i.e 31 December 2020 or at the beginning of new year. In worst case dates may not be extended