Posted by The Income Tax Department launched Jhatpat Processing of tax returns on December 20. Now, taxpayers have come up with novel ways to hasten processing of their returns filed between June and August 20, which are yet to be processed. Just for perspective, returns filed after mid-October 20 are being processed within days.
This has led to vague suggestions by taxpayers that if your tax return has not been processed yet, you should revise your return as that would ensure faster processing and delivery of refund, going by the swiftness of the new tax-filing utility. But blindly following the advice and Revising the Return could backfire and lead to further delay of processing the return, warn chartered accountants.
Not all returns processed
With the launch of Jhatpat ITR Processing via CPC 2.0, the income tax department is able to process returns faster. The caveat here is that not all returns go through Jhatpat Processing, which is the second version of technology introduced at the Central Processing Centre. It was launched in 2009 and has been the backbone of quick tax return processing.
“The Jhatpat processing of tax returns is applicable for ITR1 and ITR4. The time limit for processing of returns shall vary on a case-to-case basis, depending upon its complexity or simplicity,” says Suresh Surana, Founder, RSM India.
So, if you file ITR 3, you would be unnecessarily complicating things for yourself. There is a reason why your tax return has not been processed yet. Typically, the returns with past tax arrears, mismatch of data collated from other sources or even individual tax deduction data would require additional time to process.
Archit Gupta, founder and CEO of Cleartax says that a return should be revised only if there is a mistake in the tax return. “Lakhs of returns have been processed within two-three weeks of filing and if your return has not been processed, there could be a specific reason. They should wait for an intimation. There is no clear-cut way to hasten the processing of tax return via CPC 2.0.”
The reason for the delay in processing of your return may be complication in the number of streams through which you earn income. These are the type of returns that aren’t processed under Jhatpat mode.
Paras Savla, partner at KPB Associates says, “Jhatpat Processing is subject to conditions that the tax return must be verified, the bank account is pre-validated and there should be no tax arrears. TDS mismatch and challan mismatch too are red flags for ITR processing under the technical upgrade of CPC 2.0, which saw an expenditure sanction of Rs 4,242 crore in 2019.”
The artificial intelligence system would decide whether faster processing is applicable for a return or not.
Chances of Scrutiny
Also, while revision of returns is recommended only in the case of a mistake in the previous filed returns, experts warn that revision of returns could lead to an extreme examination of your return for what is called a scrutiny. “Revision of returns generally may not be a good strategy as there is an increased probability of such returns being picked up for tax scrutiny; or, there may be a delay in processing of the revised tax return,” says Surana.
And if you make a mistake in your revised return, your processing might get further delayed. “Once you file your revised return, your original return that you filed earlier is discarded by the tax department. Tax filing revisions are not recommended as it has been observed that people make mistakes in revised returns as they don’t understand a certain aspect,” Gupta adds.
The tax-return filing schedule has already been upset due to COVID-19-related changes. So, if you now file a revised return and make a mistake, then your second revised return must be filed by March 31, 2021, latest. And that’s just three months away, leaving you very with little time. “The option to file a fresh revision is available only during the same assessment year,” says Savla.
So, avoid following the unknown path to get in the queue for Jhatpat processing. Instead, check your tax-filing account for any notification or queries raised. Alternatively, file an e-nivaran resolution request through the same e-filing account if you foresee a major delay.
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