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REX88
06-03-2009, 12:05 AM
I have been availing the benefit of housing loan repayment and interest repayment for the past many years. For this purpose i have been furnishing the annual certificate issued by my bank[private-foreign] to certify the repayment of principal/interest for the whole year. for this purpose i have been giving the calculation for the period April to March. This practice has been accepted by many AOs earlier, whereas, my present AO is not accepting this and insist that i should follow only the period March to Feb. If i follow this i may be wrong in my claiming housing loan benefits as the amount indicated in the bank certificate may be overlapping in two periods. kindly advice the legal position.- regards, REX.

jitendraacr
06-03-2009, 10:52 PM
Dear friend
Though I am not well versed on this topic but what I am doing in the similar situation you also can do it. Give certificate of Bank to your AO and get them calculate whatever the period they want but submit your IT Return with correct amount though it may differ from Form 16 as the returns are filed on financial year basis. I do not know whether it is right or wrong but I am doing it from last 7 years.
Jitendra

badri mannargudi
07-03-2009, 08:50 PM
I have been availing the benefit of housing loan repayment and interest repayment for the past many years. For this purpose i have been furnishing the annual certificate issued by my bank[private-foreign] to certify the repayment of principal/interest for the whole year. for this purpose i have been giving the calculation for the period April to March. This practice has been accepted by many AOs earlier, whereas, my present AO is not accepting this and insist that i should follow only the period March to Feb. If i follow this i may be wrong in my claiming housing loan benefits as the amount indicated in the bank certificate may be overlapping in two periods. kindly advice the legal position.- regards, REX.

Dear friend,
In my opinion there is no justification for your A.O's insistence. With due respect to the officer (AO), it appears what he /she lost sight of is the fact that the interest you have paid to bank may have nothing to do with the pattern of salary (March to February). He/she can not insist upon you to incur the expenditure only from the salary and that too, monthwise. This sort of insistance shows lack of understanding on the part of the learned officer.
For the purpose of Income tax Return, all the expenditure (which qualify for deductions from the total income ) incurred during the relevant previous year (APRIL 2008 TO MARCH 2009 can be deducted from the Total Income for the Asst year 2009-10.and on this fundamental ground.
Second contention in your favour:
You please ask your A.O as to whether the Leave Encashment Amount (other than on Retirement) and LTC Amount claimed and settled in the month of March 2008 would be includible in the current year's (2008-09)Total Income or next year's total income (2009-10)! I think the learned A.O will realise as to who is right.

With regards,
Badri

vaasturam
08-03-2009, 07:26 AM
Dear REX88,

LET US FIRST UNDERSTAND THE BASICS OF IT ASSESSMENT.

1. Everyone should necessarily follow the Fin.Yr April-March only. There should be no deviation in this regard.

2. Income should be assessed on RECEIPTS basis only - i.e., the date of receipt/credit into the account determines the year in which that income is to be assessed.

3. All the Firms/Organisations/Govt Depts/Railways/Banks are following the Fin.yr April-March only and Form 16 should be issued only for this period.

NOW LETS COME TO THE PROBLEM

Normally, salary/pension is disbursed by the Government on the last day of every month. As the income is assessed on RECEIPTS basis, the amount paid on the last day of the Fin Yr, ie., on 31st March should also be included and tax deducted on the same.

Now, the number of persons receiving salary/pension from the Government is very huge and assessing and deducting of tax at source is a mammoth task which takes considerable time and manpower.

To obviate this difficulty, the PSU banks PREPONE THE SALARY CREDIT to 21st March and they complete the task of assessment and tax deduction within a week's time, ie., before 31st March.

The Government has taken the easier route by POSTPONING THE SALARY CREDIT to April 1st and thereby pushing that income to the next assessment year.

This above practice may have led the Govt officials to the wrong conclusion that their assessment year is from March-Feb, which is a grave mistake. You have the liberty only to alter the date of credit of salary/pension but NOT to alter the PERIOD OF ASSESSMENT which is 1st APRIL to 31st MARCH.

Any idea of using a separate PERIOD OF ASSESSMENT shows a lack of clarity on the part of the AO which amounts to CUTTING THE FOOT TO FIT THE SHOE.


NOW FOR THE SPECIFICS IN YOUR CASE

1. The Bank Certificate for interest/principal repayments for the period from 1st April to 31st March is an absolutely valid one.

2. You can ask your AO to show some order/proof that the assessment year in your case is from March-February (which he will not be able to comply)

3. You can write a letter directly to the Income Tax Department ( you can even take a copy of the above points) and ask for specific clarification in this regard. Alternatively, you can visit the website www.incomtaxindia.gov.in (http://www.incometaxindia.gov.in) and use the relevant link provided therein.

4. Last of all, you can take the advice of jitendraacr and file your tax return correctly, irrespective of what your AO decides to do.

-R.RAMASUBRAMANIAM.

ksvsmanian
11-03-2009, 07:57 PM
In Accounting terms FY means from 1st April to 31st March, so you can avail HBA exemption for the amount paid from April to March

naukar
13-03-2009, 09:19 PM
Your AO is wrong as per section 3 of income tax act, 1961. Please write any query in respect of taxation sachinagarwalcallb @ gmail.com

Section 3 Of Income Tax Act:
"PREVIOUS YEAR" DEFINED.
(1) Save as otherwise provided in this section, "previous year" for the purposes of this Act, means the financial year immediately preceding the assessment year :
Provided that, in the case of a business or profession newly set up, or a source of income newly coming into existence, in the said financial year, the previous year shall be the period beginning with the date of setting up of the business or profession or, as the case may be, the date on which the source of income newly comes into existence and ending with the said financial year.
(2)"Previous year", in relation to the assessment year, commencing on the 1st day of April, 1989, means the period which begins with the date immediately following the last day of the previous year relevant to the assessment year commencing on the 1st day of April, 1988 and ends on the 31st day of March, 1989:
Provided that where the assessee has adopted more than one period as the "previous year" in relation to the assessment year commencing on the 1st day of April, 1988 for different sources of his income, the previous year in relation to the assessment year commencing on the 1st day of April, 1989 shall be reckoned separately in the manner aforesaid in respect of each such source of income, and the longer or the longest of the periods so reckoned shall be the previous year for the said assessment year :
Provided further that in the case of a business or profession newly set up, or a source of income newly coming into existence on or after the 1st day of April, 1987 but before the 1st day of April, 1988 and where the accounts in relation to such business or profession or source of income have not been made up to the 31st day of March, 1988, the "Previous year" in relation to the assessment year commencing on the 1st day of April, 1989, shall be the period beginning with the date of setting up of the business or profession or, as the case may be, the date on which the source of income newly comes into existence and ending on the 31st day of March, 1989 :
Provided also that where the assessee has adopted one or more periods as the "previous year" in relation to the assessment year commencing on the 1st day of April, 1988, for any source or sources of his income, in addition to the business or profession or source of income referred to in the second proviso, the previous year in relation to the assessment year commencing on the 1st day of April, 1989, shall be reckoned separately in the manner aforesaid in respect of each such source of income, and the longer or the longest of the periods so reckoned shall be the previous year in relation to the said assessment year. 123
(3) Where the previous year in relation to the assessment year commencing on the 1st day of April, 1989, referred to in sub-section (2) exceeds a period of twelve months, the provisions of this Act shall apply subject to the modifications specified in the rules in the Tenth Schedule.

You may produce a copy of the above Act to your AO

gtresures
20-08-2016, 02:54 PM
Good elaborate reply sir. I totally accept it. And here AO means accounts officer (DDO) or head of office and not Assessing Officer of IT Dept. Just to clarify other readers