ITRs of salaried employees in Odisha are assessed by the I-T dept and cases of mismatch in claims of deductions/exemptions in ITRs vis-s-vis Form 16 resulting into refunds of more than Rs.50000 Targeted
Huge Mismatch Found in ITRs of Salaried Individuals in Odisha: According to a recent Advisory of the Principal Chief Commissioner of Income Tax, Odisha, Income Tax Returns of salaried employees are assessed by the Income Tax department and mismatch in claims of deductions/exemptions in ITRs vis-s-vis the Form 16 resulting into refunds of more than Rs.50000 are found by department in huge number of cases in each financial year. The department has already started sending notices under section 133(6) to the concerned individuals and asking for information in support of their claims of deductions/exemptions in their ITR.
Focus group includes employees who claimed refunds in ITRs of AY 2021-22, 2022-23 and 2023-24.
According to the advisory, the Income Tax Department is contemplating verification/actions because of suspected incorrect claims of deductions/exemptions found to be made by huge number of employees in their income tax returns.
During Financial Year 2023-24, till 10th October, 1.68 million taxpayers have already withdrawn their incorrect claims by filing updated income tax returns and have paid about Rs. 1300 crores additional taxes to the government after the department flagged the discrepancies in the ITRs filed.
Possible Consequences of Default
In case, the employees fail to justify their claims and department proves their claims incorrect, following actions may be taken by department:
(i) Reopening of Assessment under section 148 of the Income Tax Act 1961;
(ii) Penalty under section 270A, etc;
(iii) Prosecution proceedings under section 276C, 277, etc.
Corrective Actions Available
In case of incorrect claims of deductions/exemptions, salaried employees are left with one corrective action by filing their updated Updated Income Tax Returns by withdrawing their incorrect claims or claims without available evidences and paying taxes under section 140B of the Income Tax Act.
Dates Available for filing Updated returns (ITR-U)
A taxpayer can file an Updated Return of any Financial Year within end of 2 years from the end of the related Assessment Year.
| Assessment Year | Last date to file ITR-U |
| 2021-22 | 31.03.2024 |
| 2022-23 | 31.03.2025 |
| 2023-24 | 31.03.2026 |
Late Fees & Additional Tax Payable
As per Section 140B of Income Tax Act, an updated return can be filed only by paying some additional tax. The additional tax payable is based upon the number of months delay in filing the Updates Return.
(i) If Updated Return is filed within 12 months from the end of the respective Assessment Year- Additional tax payable is 25% of tax amount (including Surcharge, Cess and Interest).
(ii) If Updated Return is filed after 12 months from the end of the respective AY- Additional tax payable is 50% of tax amount (including Surcharge, Cess and Interest).
A NIL return cannot be filed under ITR-U. If tax is NIL, the taxpayer is required to pay the required amount of fees for delayed filing of ITR. For the small taxpayers, required late fees is Rs.1000, otherwise late fees is Rs.5000.
To Know How to File Updated Return (ITR-U) CLICK HERE
To Know about I-T Notice u/s. 133(6) CLICK HERE
To Download a copy of Advisory of Pr Chief Commissioner of Income Tax, Odisha CLICK HERE
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