Update on CBDTs Order

issued u/s 119 of the Income Tax Act, 1961 on 9th September, 2016
extending the due date for furnishing of return of income etc. for AY 2016-17
from 30th September, 2016 to 17th October, 2016
ORDER
F.No.225/195/2016-1TA-II
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
North Block, ITA II Division
New Delhi, the 9th September, 2016
Order under section 119 of the Income Tax Act, 1961
The last date for making declarations under the Income Declaration Scheme 2016 is 30th
September, 2016 which coincides with the last date of filing Income-tax returns by the tax payers
whose accounts are audited and who are required to furnish the returns of income for Assessment
Year 2016-17 by 30th September, 2016 as per provisions of section 139 (1) of Income tax Act,
1961.
In order to remove inconvenience and to facilitate ease of compliance, the Central Board of
Direct Taxes, in exercise of powers conferred under section 119 of the Income Tax Act, 1961,
hereby extends the due-date for furnishing such returns of Income from 30th September, 2016
to 17th October, 2016, in case of tax payers throughout India, who are liable to furnish their
Income-tax return by the said due-date.
(Deepshitha Sharma)
Director to the Government of India
Copy to
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PS to F.M./OSD to FM/PS to MoS(F)

PS to Revenue Secretary
Chairperson (CBDT), All Members, CBDT
All Pr. CCsIT/CCsIT/Pr.DsGIT/DsGIT
All Joint Secretaries/CsIT, CBDT
Directors/Deputy Secretaries/Under Secretaries of Central Board of Direct Taxes
ADG(Systems)-4 with request to place the order on official website.
Addl. CIT, Data Base Cell for placing it on irsofficers website.
The Institute of Chartered Accountants of India, New Delhi
All Chambers of Commerce
CIT(M&TP), CBDT
ADG(PR,PP&OL) for placing on twitter handle of the department

(Deepshikha Sharma)
Director to the Government of India

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The analysis of the Order

Reasons
The last date for making declarations under the Income Declaration Scheme 2016
is 30th September, 2016
which coincides with
the last date of
filing
Income-tax returns
by the tax payers
o whose accounts are audited and
o who are required to furnish the returns of income
for Assessment Year 2016-17 by 30th September, 2016
as per provisions of
section 139(1) of Income tax Act, 1961.

Order u/s 119

In order
o to remove inconvenience and
o to facilitate ease of compliance,
the Central Board of Direct Taxes,
in exercise of powers conferred under section 119 of the Income Tax Act, 1961,
hereby
extends
the due-date
for furnishing
such
returns of income
from 30th September, 2016 to 17th October, 2016,
in case of tax payers throughout India,
who are liable to furnish their Income-tax return
by the said due-date.

Questions which are being clarified

1. Whether the order issued by CBDT u/s 119 dated 9th September, 2016 applies to whole of
India?
2. Whether the order applies to all assesses who are required to file return u/s 139(1) of the
Act 30th September, 2016?

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3. Whether the order applies to section 44AB of the Act also?
a. in relation to getting the accounts audited by an accountant {see Explanation to
section 288(2)}
b. in relation to furnishing the report of such audit in the prescribed form duly
signed and verified by such accountant and setting forth such particulars as may
be prescribed {see section 2(33)} and {Form 3CA, Form 3CB and Form 3CD}

Answers
Answer to question No. 1
1. The order applies in case of tax payers throughout India.
Answer to question No. 2
1. The order applies to all tax payers throughout India a. whose accounts are audited and
b. who are required to furnish the returns of income
for Assessment Year 2016-17 by 30th September, 2016
2. The order applies to all persons whose accounts are audited. It has not mentioned that
such audit should be under section 44AB of the Income Tax Act, 1961. Therefore, it will
apply to all persons whose accounts are required to be audited under any other law. The
accounts of the Companies, LLP and Trusts are required to be audited under
respective applicable laws. This interpretation coincides with the provisions of sub-clause
(ii) of clause (a) of Explanation 2 to section 139(1), which is being discussed in detail
hereunder.
3. The order says in para 2 that CBDT hereby extends the due date for furnishing such
returns of income from 30th September, 2016 to 17th October, 2016,
4. The word such before return of income means the return of income mentioned in first
para of the Order.
5. In the para 1 of the order, the return of income which are required to be furnished for
AY 2016-17 is referred to for the following class of tax payers (assesses):
o whose accounts are audited and
o who are required to furnish the returns of income by 30 th September, 2016.

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6. Explanation-2 to section 139(1) of the Act provides the meaning of due date used in
section in section 139(1), and clause (a) to the Explanation-2 provides as follows:
(a) where the assessee other than an assessee referred to in clause (aa) is
(i) a company; or
(ii) a person (other than a company) whose accounts are required to be audited
under this Act or under any other law for the time being in force; or
(iii) a working partner of a firm whose accounts are required to be audited under this
Act or under any other law for the time being in force,
the 30th day of September of the assessment year;
7. Therefore, in the case of aforesaid assesses the due date for furnishing of return is

30th September of the Assessment year, and for AY 2016-17 it is 30.9.2016.

Accordingly, this limitation applies in the case of following assesses:
o a company {see section 2(17)}
o a person (other than a company) {see section 2(31)}
(i)
an individual,
(ii)
a Hindu undivided family,
(iii)
a company (excluded for this clause)
(iv)
a firm
(v)
an association of persons (whether incorporated or not) or
(vi)
a body of individuals(whether incorporated or not),
(vii) a local authority, and
(viii) every artificial judicial person (not falling within any of the above
clauses)
whose accounts are required to be audited
under this Act {i.e. the Income Tax Act, 1961}
under any other law for the time being in force
o a working partner of a firm (including LLP) {see section 2(23)}
whose accounts are required to be audited
under this Act {i.e. the Income Tax Act, 1961}
under any other law for the time being in force.
8.

It may be pertinent to note that in the official website of Income Tax Department,
incometaxindiaefiling.gov.in, following news and update has been flashed:
CBDT vide order u/s 119 dated 09/09/2016 has extended the 'due date' for
submission of Returns of Income from 30/09/2016 to 17/10/2016 in the case of
income tax assessees throughout India who are liable to file their Income tax
returns by 30/09/2016.

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Thus, in my view, as per the order, in the case of all aforesaid assessees, the
due date for furnishing of return of income for AY 2016-17 has now been
extended from 30.9.2016 to 17.10.2016.

Answer to question No. 3

1. Section 44AB of the Act requires every person to get his accounts of such previous year in which clause (a) or (b) or (c) or (d),
as the case may be applies, audited by an accountant {see Explanation to section
288(2)} before the specified date and
to furnish by that date the report of such audit in the prescribed form duly
signed and verified by such accountant and setting forth such particulars as may
be prescribed {see section 2(33)} and {Form 3CA, Form 3CB and Form 3CD}
2. As per aforesaid provision of section 44AB, every person to whom either of the clause (a)
or (b) or (c) or (d) applies, is obliged to make following compliances:
to get his accounts audited and
to furnish the report of such audit setting forth the prescribed particulars.
3. The accounts are required to be got audited before the specified date.
4. The audit report with the prescribed particulars is required to be furnished by that date.
5. In the second limb of the compliance, as aforesaid, that date refers to the specified
date.
6. Therefore, for both the compliances, the specified date is the due date.
7. However, the accounts are required to be audited before the specified date and the
audit report with the prescribed particulars is required to be furnished by the specified
date.
8. Clause (ii) of Explanation to section 44AB defines specified date for the purpose of
section 44AB as follows:
(ii) specified date, in relation to the accounts of the assessee of the previous
year relevant to an assessment year, means the due date for furnishing the
return of income under sub-section (1) of section 139.
9. It means that, in my view, now the accounts of the previous year 2015-16 relevant for
the assessment year 2016-17 are required to be got audited u/s 44AB of the Act before
the due date specified u/s 139(1), which in the instant case is 30th September, and which
has now been extended to 17th October, 2016.

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10. Since, for the purpose of audit of accounts the specified date is the due date as
mentioned u/s 139(1), therefore, for the purpose of furnishing of the report of such audit
with the prescribed particular, that date, which is the specified date, is also the
due date as mentioned in section 139(1), which in the instant case is 30th September,
and which for the AY 2016-17 has now been extended to 17th October, 2016.Therefore,
in my view. now for the assessment year 2016-17 the audit report is required to be
furnished by 17th October, 2016

Clarification by the Institute o Chartered Accountants of India

The Institute of Chartered Accountants of India {ICAI} has also issued a clarification dated
10.9.2016 in this regards, which is as follows:
As per section 139(1) read with section 44AB of the Income Tax Act, 1961 the due date
for filing of Income Tax Returns and Tax Audit Reports by tax payers being Company
and others required to get accounts audited under Income Tax Act, 1961 or under any
other law or working partners of firm required to be audited under any law is the 30th
September of the following year. The tax payers whose business receipts exceed Rupees
One Crore or professional receipts exceed Rupees twenty-five Lakh during the previous
year 2015-16 are required to file an Income Tax return accompanied by an audit report
by the above mentioned due date.
However, taking into consideration that the last date for making declarations under the
Income Declaration Scheme 2016 is also 30th September, 2016, the Central Board of
Direct Taxes has decided to extend the last date for such Income Tax Returns and Tax
Audit Reports which were due on 30th September, 2016 to 17th October, 2016 in order
to remove inconvenience and to facilitate ease of compliance.
{Source: Official website of the ICAI www.icai.org}

Other provisions of the Act affected

Revised Return
1. Section 139(5) of the Act provides that ever person having furnished a return u/ 139(1)
of the Act may furnish a revised return at any time before the expiry of one year from the
end of the relevant assessment year or before the completion of the assessment, which
ever is earlier.
2. Since for the aforesaid class of assesses the due date u/s 139(1) of the Act has been
changed {extended} to 17th October, 2016 for the assessment year 2016-17, now the
return for such assessment year furnished on or before 17th October, 2016 may be
revised u/s 139(5) of the Act.
Carry forward of losses
1. Section 80 of the Act provides that notwithstanding anything contained in this Chapter
{Chapter VI}, no loss which has not been determined in pursuance of a return filed in

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accordance with the provisions of section 139(3), shall be carried forward and set off
under
(i)
section 72(1) or
(ii)
section 73(2) or
(iii)
section 73A(2) or
(iv)
section 74(1) or
(v)
section 74(3) or
(vi)
section 74A(3).
2. Section 139(3) of the Act provides that if any person who has sustained a loss in any
previous year under the head
Profits and gains of business or profession or
Capital gains, and
claims that the loss or any part thereof should be carried forward under (i)
section 72(1) or
(ii)
section 73(2) or
(iii)
section 73A(2) or
(iv)
section 74(1) or
(v)
section 74(3) or
(vi)
section 74A(3)
he may furnish may, within the time allowed under section 139(1), a return of loss.
3. Since for the aforesaid class of assesses the due date u/s 139(1) of the Act has been
changed {extended} to 17th October, 2016 for the assessment year 2016-17, the loss
sustained in the previous year 2015-16 relevant for the assessment year 2016-17 under
the aforesaid heads of income and which is allowed to be carried forward under the
aforesaid sections, shall be allowed to be carried forward in terms of section 80 of the
Act if now such return is furnished on or before 17th October, 2016.
Returns required to be furnished u/s 139(4A), 139(4B), 139(4C), 139(4D), 139(4E)
or 139(4F)
1. Sections 139(4A), 139(4B), 139(4C), 139(4D), 139(4E) or 139(4F) of the Act requires
the persons mentioned therein to furnish return of income, or return of income or loss, as
the case may be. These sections also provides that and all the provisions of this Act
{Income Tax Act, 1961} shall, so far as may be, apply as if it were a return required to
be furnished under section 139(1).
2. Since for the aforesaid class of assesses the due date u/s 139(1) of the Act has been
changed {extended} to 17th October, 2016 for the assessment year 2016-17, the persons
who are required to file the return under the sections 139(4A), 139(4B), 139(4C),
139(4D), 139(4E) or 139(4F) and are covered by clause (a) of the Explanation-2 to
section 139(1), now may file the required return for the assessment year 2016-17 on or
before 17th October, 2016.

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Amounts not deductible u/s 40(a)(i)
1. Section 40(a)(i) of the Act provides that notwithstanding anything to the contrary in
sections 30 to 38, the amounts mentioned therein if paid outside India or to a
non-resident shall not be deducted in computing the income chargeable under the head
Profits and gains of business or profession on which tax is deductible at source under
Chapter XVIIB and such tax has not been deducted or after deduction, has not been paid
on or before the due date specified in section 139(1).
2. Since the due date u/s 139(1) of the Act has been changed {extended} to 17th October,
2016 for the assessment year 2016-17, the persons who are covered by the aforesaid
section 40(a)(i) and are covered by clause (a) of the Explanation-2 to section 139(1),
may claim the deduction if now the return for the assessment year 2016-17 is furnished
on or before 17th October, 2016.
Amounts not deductible u/s 40(a)(ia)
1. Section 40(a)(ia) of the Act provides that notwithstanding anything to the contrary in
sections 30 to 38, 30% of any sum payable to a resident shall not be deducted in
computing the income chargeable under the head Profits and gains of business or
profession on which tax is deductible at source under Chapter XVIIB and such tax has
not been deducted or after deduction, has not been paid on or before the due date
specified in section 139(1).
2. Since the due date u/s 139(1) of the Act has been changed {extended} to 17th October,
2016 for the assessment year 2016-17, the persons who are covered by the aforesaid
section 40(a)(ia) and are covered by clause (a) of the Explanation-2 to section 139(1),
may claim the deduction if now the return for the assessment year 2016-17 is furnished
on or before 17th October, 2016.
*****
Disclaimer
This document has been prepared for academic use only for sharing knowledge on the subject with fellow
professionals. Though every effort has been made to avoid errors or omissions in this document yet any
error or omission may creep in. Therefore, it is notified that I shall not be responsible for any damage or
loss of action to any one, of any kind, in any manner there from. On the contrary it is suggested that to
avoid any doubt the user should cross check the correctness of the text, contents and the law with the
relevant order and the related law. If anyone holds different view, kindly share, so that appropriate steps
be taken for seeking clarification from the concerned competent authorities in larger professional and
public interest.
Conceived, designed and prepared by
CA. Rajiv Kumar Jain
Member of ICAI
5269, Ajit Mansion,
Shradhanand Marg,
Delhi-110006

Dated : 12.9.2016

Phone : 23214596 Mobile. : 9810288997

Email ID : rajivkjain0608@gmail.com
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