<p>As anticipated, the High Courts were flooded with petitions seeking extension of due dates for filing the income tax returns. On September 24, the Rajasthan and Karnataka High Courts, in their interim orders, directed the CBDT to extend the tax audit report filing date from September 30 to October 31, 2025.</p>.<p>On September 25, the CBDT extended the due date for filing the audit report accordingly. On September 26, the Gujarat High Court also directed that the tax-audit return due date be extended from October 31 to November 30. Similar orders are expected from other High Courts as well. Wait! Despite technical glitches since August last week, the above extensions are being granted only for those taxpayers subject to tax audit, and not for others. </p>.<p><strong>Due date missed, still you can file your Return</strong></p>.<p>If a non-tax audit return filer missed the September 16 due date (extended from the actual due date of July 31), he or she is still eligible to file a belated return on or before December 31, 2025. By doing so, they can avoid severe consequences for non-compliance, but only to some extent, not fully. Since the ‘Original Return’ is to be filed after the due date but three months before the end of the relevant assessment year, it is called a belated return.</p>.'Agentic AI unlocks new business models for IT firms': Deloitte's Ashvin Vellody.<p><strong>Consequences for not filing</strong></p>.<p>For not filing, with or without the taxpayers’ own fault, they are subject to the following penalties and other consequences.</p>.<p>Compulsory new regime: Due to the missing of the due date, a taxpayer will not be allowed to choose tax regimes as per his own whims and fancies. That is, he/she should choose the new default regime compulsorily and forgo all the available exemptions and deductions, such as HRA, LTA, housing loan interest, though eligible and may end up with additional tax outgo. In addition, he/she cannot carry forward any losses incurred from business/profession and capital gains. However, unabsorbed depreciation and loss from house property are allowed.</p>.<p>Reduced interest on tax refunds: Late filers will fetch lesser interest on their refunds, compared to those who filed on or before September 16, 2025. Their ‘interest on tax refund’, if any, will be computed from the date of filing of the return, for instance, those who filed the return with a refund of Rs 10,000/- on or after September 17, will fetch less interest that is only from the date of filing the return till the date of processing it and not from April 1, 2025. </p>.<p>Interest on unpaid tax: The taxpayer is liable for an interest on unpaid income tax at 1% per month or part thereof. Also, interest on the shortfall/late payment of advance tax is attracted separately.</p>.<p>Late Fee: They are liable for late filing fees of Rs 1,000 for taxpayers whose total income is not more than Rs 5 lakh during the FY 2024-25 and Rs 5,000 for those whose total income exceeds Rs 5 lakh.</p>.<p>Prosecution: In certain cases, a taxpayer may be punishable with imprisonment of three months to seven years and a fine.</p>.<p><strong>Suggestion to the finance ministry</strong></p>.<p>As we move from the 1961 Act to the 2025 Act, the four-year-old new e-filing portal 2.0 is again required to be recalibrated fully as per the new income tax sections, rules and forms. A revisit on ‘returns current due dates’ and change them to August 31, 2026, for non-tax audit cases and October 31, 2026, for both submission of tax audit reports and returns will ensure a smooth transition.</p>.<p>Reason: Given the last four years’ worst experience faced by taxpayers as well as tax professionals, no one has confidence that the portal will handle the huge traffic congestion of about 7-8 crore returns in the July-Oct 2026 filing season.</p>.<p><strong>Suggestion to the taxpayers</strong></p>.<p>The taxpayers’ own casual behaviour of filing their returns only during the last one to two weeks or the final day is also clogging the portal. It is high time for them to change their behaviour for their own sake, take the annual tax compliance job seriously, and start submitting their returns from the second week of June after reconciling their data with Form 16/16A, Form 26AS, AIS and other records instead of waiting for the last week or day or court-directed extensions. </p>.<p>Since India is aiming to become the third largest economy by 2028, compelling a taxpayer to approach courts even for simple due date extensions every year, collecting late fee over and above the tax for not their faults, without providing a smooth filing portal, not fixing accountability on the CBDT for not timely releasing of ITR forms and utilities, e-filing portal service provider- Infosys and non- conducting an independent third-party audit of the e-filing system does not augur well. Does the CBDT expect repetition of the cycle of approaching the courts for reliefs and embarrassments from the judiciary even in 2047 Vikasita Bharat?</p>.<p>(The writer is Founder & CEO, Shree Tax Chambers)</p>
<p>As anticipated, the High Courts were flooded with petitions seeking extension of due dates for filing the income tax returns. On September 24, the Rajasthan and Karnataka High Courts, in their interim orders, directed the CBDT to extend the tax audit report filing date from September 30 to October 31, 2025.</p>.<p>On September 25, the CBDT extended the due date for filing the audit report accordingly. On September 26, the Gujarat High Court also directed that the tax-audit return due date be extended from October 31 to November 30. Similar orders are expected from other High Courts as well. Wait! Despite technical glitches since August last week, the above extensions are being granted only for those taxpayers subject to tax audit, and not for others. </p>.<p><strong>Due date missed, still you can file your Return</strong></p>.<p>If a non-tax audit return filer missed the September 16 due date (extended from the actual due date of July 31), he or she is still eligible to file a belated return on or before December 31, 2025. By doing so, they can avoid severe consequences for non-compliance, but only to some extent, not fully. Since the ‘Original Return’ is to be filed after the due date but three months before the end of the relevant assessment year, it is called a belated return.</p>.'Agentic AI unlocks new business models for IT firms': Deloitte's Ashvin Vellody.<p><strong>Consequences for not filing</strong></p>.<p>For not filing, with or without the taxpayers’ own fault, they are subject to the following penalties and other consequences.</p>.<p>Compulsory new regime: Due to the missing of the due date, a taxpayer will not be allowed to choose tax regimes as per his own whims and fancies. That is, he/she should choose the new default regime compulsorily and forgo all the available exemptions and deductions, such as HRA, LTA, housing loan interest, though eligible and may end up with additional tax outgo. In addition, he/she cannot carry forward any losses incurred from business/profession and capital gains. However, unabsorbed depreciation and loss from house property are allowed.</p>.<p>Reduced interest on tax refunds: Late filers will fetch lesser interest on their refunds, compared to those who filed on or before September 16, 2025. Their ‘interest on tax refund’, if any, will be computed from the date of filing of the return, for instance, those who filed the return with a refund of Rs 10,000/- on or after September 17, will fetch less interest that is only from the date of filing the return till the date of processing it and not from April 1, 2025. </p>.<p>Interest on unpaid tax: The taxpayer is liable for an interest on unpaid income tax at 1% per month or part thereof. Also, interest on the shortfall/late payment of advance tax is attracted separately.</p>.<p>Late Fee: They are liable for late filing fees of Rs 1,000 for taxpayers whose total income is not more than Rs 5 lakh during the FY 2024-25 and Rs 5,000 for those whose total income exceeds Rs 5 lakh.</p>.<p>Prosecution: In certain cases, a taxpayer may be punishable with imprisonment of three months to seven years and a fine.</p>.<p><strong>Suggestion to the finance ministry</strong></p>.<p>As we move from the 1961 Act to the 2025 Act, the four-year-old new e-filing portal 2.0 is again required to be recalibrated fully as per the new income tax sections, rules and forms. A revisit on ‘returns current due dates’ and change them to August 31, 2026, for non-tax audit cases and October 31, 2026, for both submission of tax audit reports and returns will ensure a smooth transition.</p>.<p>Reason: Given the last four years’ worst experience faced by taxpayers as well as tax professionals, no one has confidence that the portal will handle the huge traffic congestion of about 7-8 crore returns in the July-Oct 2026 filing season.</p>.<p><strong>Suggestion to the taxpayers</strong></p>.<p>The taxpayers’ own casual behaviour of filing their returns only during the last one to two weeks or the final day is also clogging the portal. It is high time for them to change their behaviour for their own sake, take the annual tax compliance job seriously, and start submitting their returns from the second week of June after reconciling their data with Form 16/16A, Form 26AS, AIS and other records instead of waiting for the last week or day or court-directed extensions. </p>.<p>Since India is aiming to become the third largest economy by 2028, compelling a taxpayer to approach courts even for simple due date extensions every year, collecting late fee over and above the tax for not their faults, without providing a smooth filing portal, not fixing accountability on the CBDT for not timely releasing of ITR forms and utilities, e-filing portal service provider- Infosys and non- conducting an independent third-party audit of the e-filing system does not augur well. Does the CBDT expect repetition of the cycle of approaching the courts for reliefs and embarrassments from the judiciary even in 2047 Vikasita Bharat?</p>.<p>(The writer is Founder & CEO, Shree Tax Chambers)</p>