234F – Fee for delayed filing of return – should be Withdrawn – Budget 2017-18 Suggestion

By | March 3, 2017
(Last Updated On: March 3, 2017)

Suggestions on Clause 75 of Finance Bill 2017 – Section 234F – Fee for delayed filing of return Removal of provision levying fees to prevent undue hardship for the genuine assessees

The Finance Bill, 2017 proposes to levy fees of Rs.5,000 in case where return is furnished after the due date but on or before 31St December of the relevant assessment year and Rs.10,000, in other cases. However, it is also proposed to restrict the fees to Rs.1,000, where the total income does not exceed five lakh rupees. [ Read Fee for delayed filing of Income tax return w.e.f AY 2018-19 ]

Current provisions provide for penalty of Rs.5,000 under section 271 F in case where return is furnished after end of relevant assessment year provided there is no reasonable cause for such delay.

The proposal is made with a view to ensure that returns are filed within the due dates specified in section 139(1). However, fees proposed under section 234F will be leviable on all assessees who have furnished return beyond the due date specified under section 139(1) irrespective of the reason for such delay and whether all the taxes have been paid through TDS or Advance Tax.

Also, the assessee cannot justify his cause for delay under any appeal against the same as there is no proposed provision to consider the reasonable cause for delay on the part of assessee.

Further, fee is generally levied in respect of services rendered. Whereas collection of tax by the Government is a sovereign function, as such, there is no rendering of services. Delay in filing of return is in contravention of law for which penalty should be attracted. The same can be waived if reasonable cause is proved.


It is suggested that proposed fees under section 234F for delayed filing of return may be withdrawn and necessary amendments be made in section 271F.

Source- ICAI Post-Budget Memoranda-2017

Budget 2017-18 Suggestion- Turnover Limit needs to be increased for TDS section 194A/ 194H/ 194I & 194J

Transfer of unquoted shares – double taxation for seller and buyer -Budget 2017-18 Suggestion

Capital Gain – joint development agreement -Budget 2017-18 Suggestions

Gift u/s 56(2)(x) not treated as Income u/s 2(24)? Budget 2017-18 Suggestions

Transfer of carbon credits not treated as Income u/s 2(24)? Budget 2017-18 Suggestions

Clear confusion of TCS on Sale of Jewellery w.e.f 01.04.2017 – Budget 2017-18 Suggestions

Exclude pooling vehicles like Mutual funds, AIP’s from section 115BBDA- Dividend Taxation– Budget 2017-18 Suggestions

Rs 2 Lakh Interest deduction for house property held as stock-in-trade by builders? – Budget 2017-18 Suggestions

Partly Cash Expenditure on Asset – entire amount Disallowed ? Budget 2017-18 Suggestions

Reduce Tax to @ 25% on LLP, Firms, Firms Coverted into Companies, New companies – Budget 2017-18 Suggestions

Withdraw Surcharge@10% for total income between Rs.50 lakhs to Rs. 1 crore -Budget 2017-18 Suggestions

271J Penalty on CA/ Professionals – Reasons for removal -Budget 2017-18 Suggestions

Indirect transfer tax provisions should be extended to Category III FPI – Budget 2017-18 Suggestions

Related Post on Budget 2017-18

Budget Speech 2017-18 -Download /Print

Finance Bill 2017 -Download /Print -Budget 2017-18

Memorandum Explaining Provisions in Finance Bill 2017

Updates  on Union Budget 2017-18

Books on Budget 2017-18

Taxmann’s Budget 2017-18 -Book

Budget 2017-18- Notifications on Central Excise , Customs and Service tax – New Book

Ajit Prakashan’s Union Budget 2017-18 -New Book

BDP’s Customs Law Manual (2017-18 Budget Editon with CD) -New Book


Leave a Reply

Your email address will not be published.