| Question And Answer | |
|---|---|
| Subject: | Tax demand notice under 271AAC |
| Category: | Income-Tax |
| Querist: | Deepak Kumar |
| Answered by: | Law Intern |
| Tags: | belated return of income u/s 139(5), rectification application u/s 154 |
| Date: | July 22, 2025 |
My father is an ex- service man, when he retired he received gratuity amount( tax free for govt employees) and he invested it in mutual fund, he also received pension only for 5-6 months, total tax payable as calculated by CA is zero. Due to health issues he could not file the ITR for that year. Now a tax demand notice ( huge sum) has come along with penalty proceedings. Only came to know after my father got call from IT department. How to solve this issue. Earlier also notices were issued but we were not aware as registered email id belongs to someone working in account department of regimental office.
You can file a belated return of income u/s 139(5) offering the correct income to tax. Alternatively, you can file a rectification application u/s 154 pointing out that the demand has been erroneously computed. The penalty & interest is consequential. If the income is computed at Nil, the penalty for concealment & interest for advance-tax will be dropped.