Every year we saw that lot of people apply in the court for the extension of the last date of the returns or complaining about the payment of the hefty late fees for late filling of the returns. Currently India is introduce the late fees U/s 234D for late filling of return Rs.1, 000 ,if a person is having a total income less than 5 Lakh rupees in the previous financial year, for the whole relevant assessment year and Rs. 5,000 if a person is having a income more than 5 lakh rupees in the previous financial year but return is fill before 31st December of the assessment year but after the end of the due dates and Rs.10,000 if return is fill after 31st December of the assessment year and more over India now do not provide the chance to fill the income tax return after the ending of the relevant assessment year. In 2019 almost 49, 29,121 Indians individuals and other tax payers file their income tax return and on the last date of the return filling and 34, 95,093 Indian in the preceding previous year, and it is a very major problem in India.
India is very well know in the world due to its complex tax structure with lots of rules, Judgments, Notifications, Advance Ruling and other and above all lot of the formalities, slow website operating due to overloading, due to which the date line of the filling of the returns sometimes become like a death trap for taxpayers and tax professionals and to avoid the heavy penalties sometimes people fill the wrong return and/or wrong detail in their return. which is a loss of revenue to government as well wrong information provide to all National and International Agencies, which is ultimately a country loss, For avoiding the wrong filling of the return and the allowing to people to make the right return we need to follow the same scheme of time extension as USA is follow. USA provide an option to its citizens and companies to file an application in 4868 Form if they are having a taxable income from the national sources and 2350 Form to Individuals and companies which are having a income from the international Sources. Form 4868 is providing 3 month extension to the person or Companies and form 2350 provide the 6 month extension to correctly calculation of the income and filling to correct income tax return along with which correct information.
In our view Indian government must also provide such options to Indians, which will promote the correct tax compliance by the individuals and companies and will also contribute as an easy of doing business and more revenue generate for government. It will help to achieve the most ambitious plans of the current government, a 5 Trillion Economy by 2024, and it will make happy to all.