Got a defective ITR notice from income tax department? Why and how to rectify the defect

When and why would you receive a defective ITR notice?

• The gross receipts in Form 26AS on which TDS credit has been claimed is higher than total receipts.
• The gross total income and all income heads are entered as “nil or 0,” but tax liability has been computed and paid.
• The taxpayer’s name in the ITR does not match the PAN database.
• The taxpayer has not filled a Balance Sheet and Profit and Loss Account, but has income under the head “Profits and gains of Business or Profession.”

Steps to correct a defective ITR using the e-filing portal

Step 1: Go to the e-filing ITR portal and log in using your credentials.

Step 2: Navigate to ‘e-File’ and select ‘File Income Tax Return’. After that, proceed according to the on-screen instructions.

Step 3: When asked why you are filing an ITR, select ‘Filed in Response to Notice u/s 139(9) to rectify the defect’.

Step 4: The defective ITR notice will mention the defect. So, if you agree with the defect, you can file a revised ITR correcting the highlighted defect.

Step 5: However, if you don’t agree with the defective ITR notice, you can select the ‘Disagree’ option on the ‘e-Proceedings’ tab and provide a detailed explanation for your disagreement in the text box.

Disagreement can also be communicated with the jurisdictional A.O. It is also possible to file an appeal in the income tax appellate tribunal if you are not satisfied with the A.O’s decision.

What is the caveat of rectifying a defective ITR?

Rectifying a defective ITR can increase your tax liability by making you liable to pay penal interest.

However, failing to rectify the defect will be treated as if the ITR was not filed at all, leading to you having to file a belated ITR or an updated ITR (ITR-U).