Received a ‘defective return’ notice under Section 139(9)? Here’s how to respond to it

Taxation is the most popular and important government function to redistribute money to the people. It is an attempt to use a progressive tax system to share the costs of economic growth. To reduce the tax burden, the government has several measures in which tax payers are given credit as refunds while filing their Income Tax Return (ITR).

However, many people get worried when the Income Tax Department just mentions the taxes and notices. But there is nothing to be afraid of. When you do something you don’t do often or aren’t used to, like filing income tax forms, it’s normal to make some mistakes.

The IT department frequently sends letters to taxpayers for various reasons. Sometimes, forgetting to input the specified data or any other discrepancy can lead to a ‘faulty return’ notification.

What is a defective return?

Your return may be considered an “incorrect return” in certain circumstances when you miss a piece of information or enter incorrect data. In such cases, the IT Department shall issue a notice of erroneous return as per Section 139 (9) to correct the errors.

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As per Section 139 (9) of the Income Tax Act, 1961, the AO has 15 days to make necessary corrections if he finds a discrepancy in your return. These errors, if not corrected in time, can have an adverse effect.

When can your return be considered defective?

The department may issue a notice of erroneous return if the tax against a liability is partially paid or paid but the amount does not match the tax due in the income tax return.

Second, if your income tax return is incomplete or information is missing in required columns, declarations, or appendices, you can get notice from the IT department.

If the bank has deducted tax from your interest income from fixed deposits, you must declare both interest income and tax in your tax return. If TDS was claimed but the interest income was not included in the tax return, you may receive a defective notice.

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Additionally, if audit is required under section 44AB, a complete audit report including profit and loss account, balance sheet, and auditors’ report has to be submitted. If you fail to provide these documents or if you submit an incomplete accounting report, you run the risk of receiving a defective return notice.

Moreover, if taxes have been paid but their details are not included in the income tax return, you may receive a notice. While completing income tax returns, specific information on taxes paid such as TDS, TCS, advance tax, or self-assessment tax should be included.

How to respond to defective return notices?

Step 1: Visit Income Tax Department website to get ITR form.

Step 2: Select the option “In response to notice under section 139(9) when the return originally filed is a defective return” in the income tax return.

Step 3: Enter the reference number, which can be found on the notice, the approval number, and the actual return filing date.

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Step 4: Finish filing the income tax return, making any necessary corrections.

Step 5: Create an XML file, then post it on the Income Tax Department’s website.

Step 6: Under “e-file”, choose “e-file in response to notification 139(9)” and then upload the corrected XML using the notification password.

Step 7: On successful upload, a confirmation message and an approval number are displayed on the website.

Your ITR for the relevant assessment year will be treated as invalid if you fail to reply to the Income Tax notice for the defective return. In this case, the tax office will assume that you have not submitted your return and will not process your refund, if any. Hence, it is advisable to respond clearly to the notice by following the steps mentioned above.


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First published: 08 January 2023, 10:21 AM IST


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