Article Details

TAX TALK-10.08.2015-THE HITAVADA

TAX TALK

CA. NARESH JAKHOTIA

Chartered Accountant

ITR FORMS: THE WAIT IS FINALLY OVER

Query 1]
Please let me know as to which ITR Form (ITR 5 or ITR 7) is required to be filed by educational institution having receipt below Rs. 1 crore for the financial year 2014-2015? Please also let me know whether the educational institution which has applied U/s 56D is also required to file income tax return till sanction? [ca.*****narayan@gmail.com]
Opinion:
Finally, the wait for the new income tax return forms is all over. ITR filing season is now all set to start. The best part, the so called simplified ITR forms are notified much before the sequel of blockbuster Bahubali. The second best part, the last date to file tax returns has already been extended till 31st August, 2015 for individual/HUF not covered by tax audit provision. The flow of queries in “Tax Talk” every year reflects the confusion that prevails as to the applicability of ITR forms. The present column is an attempt to clarify all about ITR applicability. To begin, ITR-1, 2, 2A, 3 & 4 are for individual/HUF assessee whereas ITR-5 is for firm/AOP, ITR-6 is for the companies, ITR-7 for the trust. The details of the forms for the AY 2015-16 are as under:
a] ITR 1 (Sahaj):
This form is to be used by only an individual whose total income consists of

Income from Salary/Pension or
Income from One house property (excluding cases where loss is brought forward from previous years.) or
Income from other sources (excluding winning from Lottery and income from Race Horses) and does not have any loss under the head. [Further in a case where the income of another person like spouse minor child, etc. is to be clubbed with the income of the assessee, this Return from can be used only if the income being clubbed falls under the above income categories].
Who can not use this form

This form cannot be used if individuals have income from more than one house property or have income from lottery/race horse, Capital Gains income, Agriculture Income exceeding Rs 5,000/-, Business/Profession Income or Loss under the head “Income From Other Sources” or claimed any relief under section 90/91 or, in case of person resident in India, have any assets (Including financial interest in any entity) located outside India or signing authority in any account located outside India or have any income from any source outside India.

b] ITR 2:
This return Form is to be used by an individual or HUF whose total income consists of:

Income from Salary / Pension or
Income from House Property or
Income From Capital Gains or
Income from Other Sources (including Winning form Lottery and Income from Race horses). [Further in a case where the income of another person like spouse, minor child etc. is to be clubbed with the income of the assessee, this Return form can be used where such income falls in any of the above categories]. If individual/HUF has income from business/profession, ITR-2 cannot be used for return filing.

c] ITR 2A:
This s Return Form is to be used by an individual/ HUF whose total income consists of:

Income from Salary/Pension or
Income from House Property or
Income from Other Sources (including Winning form Lottery and Income from Race horses). [Further in a case where the income of another person like spouse, minor child etc. is to be clubbed with the income of the assessee. This Return Form can be used where such income falls in any of the above categories].

This form cannot be used if individual/HUF have Capital Gains income, Agriculture Income exceeding Rs 5,000/-, Business/Profession Income or Loss under the head “Income From Other Sources” or claimed any relief under section 90 and /or 91 or, in case of person resident in India, have any assets (Including financial interest in any entity) located outside India or signing authority in any account located outside India or have any income from any source outside India.

d] ITR 3:
This Return Form is to be used by an individual/HUF who is a partner in a firm and does not have any other business income except income from such firm. Even in case of partners who have only exempt income in the form of share of profit from the firm and no interest/salary/commission/remuneration income etc, still return would be required to be filed in ITR-3.

e] ITR 4S (Sugam):
This Return Form is to be used by an individual/HUF whose total income consists of the following:

Business income where such income is computed in accordance with special provisions referred to in section 44AD 44AE of the Act for computation of business income or
Income from salary / Pension or
Income from one House property (Excluding cases where loss is brought forward from previous years) or
Income from Other Sources (Excluding winning from lottery and income from Race Horses)

[Note: (1) The Income computed shall be presumed to have been computed after giving full effect to every loss allowances depreciation or deduction under the Income Tax Act. (2) Further in a case where the income of another person like spouse. Minor child etc. is to be clubbed with the income of the assesses, this Return form can be used only if the income being clubbed falls into either of the above income categories. (3) This form cannot be used if individuals have income from more than one house property or have income from lottery/race horse, Capital Gains income, Agriculture Income exceeding Rs 5,000/-, Business/Profession Income or Loss under the head “Income From Other Sources” or claimed any relief under section 90 and /or 91 or, in case of person resident in India, have any assets (Including financial interest in any entity) located outside India or signing authority in any account located outside India or have any income from any source outside India.

f] ITR 4:
This Return Form is to be used by an individual/HUF who is carrying out a proprietary business or Profession & is not covered in any of the above categories.

g] ITR 5:
ITR – 5 is applicable to Firms, Limited Liability Partnerships (LLP), Association of Persons (AOP), Body of Individuals (BOI), Co-operative Banks, Co-operative Societies, and Artificial Judicial Persons

h] ITR 6:
This form has to be used by Companies other than companies claiming an exemption under section 11.

i] ITR 7:
This Form has to be used by person including Companies who are required to furnish return under section 139(4A) or 139(4B) or 139(4C) or 139(4D) or 139(4E).

In your specific case, it may be noted that Return u/s 139(4C) is required to be filed by every scientific research association; news agency, association or institution referred to in section 10(23A); institution referred to in section 10(23B); fund or institution or university or other educational institution or any hospital or other medical institution whereas Return under section 139(4D) is required to be filed by every university, college or other institution, which is not required to furnish return of income or loss under any other provision of this section. You would be required to file ITR-7.

[The author is a practicing Chartered Accountant from Nagpur. Readers may send their direct tax related queries at SSRPN & Co, 10, Laxmi Vyankatesh Apartment, C.A. Road, Telephone Exch. Square, Nagpur-440008 or email it at nareshjakhotia@ssrpn.com].