Section 140A-Self Assessment Income Tax Act

After section 140 of the Income Tax Act, the Finance Act inserted the section 140A Self Assessment Income Tax Act. Section 140A covers several sub-section which we will discuss here briefly.

Section 140A-Self Assessment Income Tax Act

Self Assessment Income Tax Act

Section 140A(1) of the Income Tax Act

As per this section, where any tax payable by the assessee on the basis of; any return needed to be furnished U/S 115WD/115WH or 139 or 142 or 148 or 153A or 158BC or; as the case may be, after taking into account;

  • the tax amount, if any, already paid under any provisions of this Act,
  • any TDS deducted or collected,
  • any relief of tax or tax deduction claimed U/S 90 or 91; on account of tax paid in the country outside India;
  • relief of tax claimed, if any, under section 90A; on account of tax paid in any specified territory outside India as referred to in that section, and
  • the tax credit, if any, claimed to be set off as per the provisions of section 115JAA or 115JD,

he shall be liable to pay such tax along with interest as well as fee; payable under the provisions of this Act for any delay in furnishing the return or; any delay or default in payment of advance tax, before furnishing the return and; he shall accompany the return with the proof of payment of such tax as well as interest.

Explanation:

1. Where any amount which the taxpayer pays under this sub-section falls short of the aggregate tax and interest as above-mentioned; then such amount shall first be settled towards the interest payable as above-mentioned and the balance, if any; shall be settled towards the tax payable.

2. Interest payable U/S 234A shall be calculated on the amount of the tax on the aggregate income as stated in the return as reduced by the amount of;

  • advance tax, if any, paid,
  • any TDS deduced or collected,
  • any relief of tax or tax deduction claimed U/S 90 or 91 on account of tax paid in the country outside India,
  • relief of tax claimed, if any, U/S 90A on account of tax paid in any specified territory outside India as referred to in that section, and
  • any tax credit claimed to be set off as per the provisions of section 115JAA or 115JD.

3. Interest payable U/S 115WK shall be computed on the amount of tax on the value of fringe benefits as declared in the return, as reduced by the advance tax, paid if any.

4. Interest payable U/S 234B shall be calculated on the amount equal to the assessed tax, or as the case may be, on the amount by which the advance tax paid falls low of the assessed tax.

Notes:

Assessed Tax‘ means the tax on the aggregate income as declared in the return as reduced by the amount of;

  • TDS deducted or collected, as per the provisions of the Chapter XVII, on any income which is subject to such deduction or collection & which is taken into account in calculating such total income,
  • any relief of tax or tax deduction claimed U/S 90 or 91; on account of tax paid in a country outside India,
  • any relief of tax claimed U/S 90A on account  of tax paid in any specified territory outside; as referred to in that section, and
  • tax credit claimed, if any, to be set off as per the provisions of section 115JAA or section 115JD.

Section 140A(2) of the Income Tax Act

As per the section 140A(2), where a regular assessment has been made U/S 115WE/115WF or 143 or 144 or an assessment U/S 153A or 158BC, any amount which the assessee pays U/S 140A(1), shall be assumed to have been paid towards before-mentioned regular assessment or assessment as the case may be.

Section 140A(3) of the Self Assessment Income Tax Act

Under this section, if any taxpayer fails to pay any part or whole of such tax or interest or both as per the provisions of section 140A(1), he shall be assumed to be the taxpayer in default in respect of tax or interest or both remaining unpaid, without prejudice to any additional consequences which he may incur, and all the provisions of this Act shall apply accordingly.

Section 140A(4) of the Self Assessment Income Tax Act

The provisions of this sub-section shall apply to any assessment for the AY, beginning on the 1st April 1988 or any earlier AY and; the references in this section to the other provisions of this Act shall be interpreted as references to those provisions as for the time being in force & shall apply to the relevant AY.

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