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Filing Tax Return in Case of Loss Section 139( 3 )
Is it necessary to submit loss return under Area 139( 3)?
Guidelines and arrangements connected to filing of tax return in case of Loss [Loss return] are governed by Section 139( 3) of the Income Tax Act1961 Based on these provisions it has been specified that in case a taxpayer has actually incurred a loss in the previous year, it is not obligatory for him to submit an income tax return for the same.Section 157 of the Earnings Tax (IT) Act, 1961, states that there are two conditions to be pleased prior to loss is allowed to be continued. The return of loss must be submitted on or before the due date. Second, the loss has actually been identified by the evaluating officer (AO) The AO needs to notify the assessee by an order in composing the amount computed by him which the assessee is entitled to continue.
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Non applicability:
This is not suitable to partner ship Firms and joint stock Companies as they are required to submit an income tax return even in case of loss.
In what cases Return Of Loss Should Be Filed based on Section 139( 3 ):
When an assessee who has suffered a loss in a previous year under the heads:
1. Capital gains and/ or
2. Revenues and gains of service or profession
And if he wants that the loss or any part thereof should be continued for the next evaluation years then, he “may” furnish a return of loss within the time enabled, in the prescribed type. That return must remain in accordance with all the provisions associated with it.
If the assessee wants to declare this loss in future years versus income of the prospering years then The Income Tax Return showing the loss ought to be filed on or prior to the due date if this loss is to be continued to the next year and set-off against future earnings.
However this is just in respect of loss occurred under the above stated heads.
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In case of loss took place is under the head Home home income:
If loss happened under head income from Home Property then it will be allowed to be carried forward even though the tax return is submitted after the due date of filing of return.
When the assessee has actually not sent loss return in the first time and he submits a return of loss in reaction to a notification under Area 142( 1 ), such loss can not be continued unless it is a loss under head income from home residential or commercial property.
For setting off the loss arises under one head against income under another head it is not required to submit a return of loss under this head.
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