Defective Notice Under Section 139(9) of the Income Tax Act

What is a Defective Return?

A defective return occurs when an income tax return is missing essential details or contains incorrect information. In such cases, the Income Tax Department issues a defective notice under Section 139(9), informing the taxpayer of the errors and requesting corrections.

Taxpayers must rectify the errors and submit the corrected return within 15 days from the date of receiving the notice. Failure to do so may lead to potential consequences in the future.

The defective return notice under Section 139(9) is sent via email to the taxpayer’s registered email ID. It is also accessible through the income tax e-filing portal.

If you have received a defective return notice, file a revised ITR promptly to resolve the issue.

Who Issues the Notice Under Section 139(9)?

The notice under Section 139(9) is sent by the Assessing Officer or tax authorities of the Income Tax Department. They review the taxpayer’s filed return and issue this notice if they detect discrepancies or incomplete details, rendering the return defective.

What is the Password for the Section 139(9) Notice?

The defective return notice is sent as an attachment via email and is password-protected. To open the notice, use your PAN (in lowercase) followed by your date of birth in the DDMMYYYY format.

Example:
If your PAN is MNOPQ1212C and your date of birth is 12th October 1987, then your password will be:
👉 mnopq1212c12101987

Deadline to Respond to a Defective Return Notice

Taxpayers must respond to a defective return notice under Section 139(9) within 15 days from the date of issuance. The defects must be corrected, or a valid explanation must be provided within this timeframe. If no response is submitted, the return may be treated as invalid by the tax department.

Reasons for Receiving a Defective Return Notice Under Section 139(9)

A taxpayer may receive a defective return notice under Section 139(9) for various reasons. Some of the key reasons include:

1. Incomplete ITR

• Missing annexures, statements, or necessary details in the income tax return.
  
  

• For example, if claiming a deduction under Section 80G, the details must be correctly filled in the relevant schedule.
  
  

2. Missing Tax Information

• If tax (including interest, if applicable) is paid before filing the return but the corresponding details are not provided.
  
  

• Fields such as BSR code, challan date, and challan serial number must be correctly filled.
  
  

3. Mismatch in Tax Details

• If the actual tax paid does not match the tax payable in the return.
  
  

• If taxes are not paid in full before filing the return.
  
  

4. Errors in Presumptive Taxation Scheme

• ITR-4 filed incorrectly instead of ITR-3 if:
  
  

• Presumptive income is shown as less than 8% or 6% of gross turnover/receipts under Section 44AD.
  
  

• Gross receipts are not mentioned in the Profit & Loss Account.
  
  

• Income under Section 44AD exceeds ₹2 Crore.
  
  

• Incorrect ITR filing under Section 44ADA:
  
  

• If gross receipts exceed ₹50 lakh but Balance Sheet and Profit & Loss statements are not included.
  
  

• Such cases require ITR-3 with audited financial statements.
  
  

• Budget 2023 Changes:
  
  

• The presumptive taxation limit has been increased:
  
  

• Section 44AD: ₹3 Crore (earlier ₹2 Crore).
  
  

• Section 44ADA: ₹75 Lakh (earlier ₹50 Lakh).
  
  

• This increased limit applies only if 95% of transactions are done digitally.
  
  

5. Non-Maintenance of Books of Accounts

• If a taxpayer is required to maintain books of accounts (Balance Sheet, Profit & Loss statement) but fails to report them in the return.
  
  

6. TDS Claimed but Income Not Reported

• If TDS is claimed for a refund but the corresponding income is not mentioned in the return.
  
  

7. Income Tax Audit Non-Compliance

• If an audit is required, but the audit report and financial statements have not been submitted with the return.
  
  

8. Cost Audit Non-Compliance

• If a taxpayer is subject to cost audit but has failed to provide relevant details in the return.
  
  

9. Mismatch in Name

• A name mismatch between PAN details and the Income Tax Return may lead to a defective return notice.

Steps to Take After Receiving a Notice Under Section 139(9)

If you receive a defective return notice under Section 139(9), follow these steps:

1. Revise Your Return Within 15 Days
   
   

• You must correct and submit your revised income tax return within 15 days from the date of receiving the notice.
  
  

2. Request an Extension (If Needed)
   
   

• If you require more time, you can submit a written request to the Assessing Officer (A.O.) asking for an extension of the deadline to file a revised return.
  
  

3. Late Submission Consideration
   
   

• In some cases, if you rectify the defect after 15 days but before the assessment is completed, the Assessing Officer may still accept the revised return and consider it valid.
  
  

4. If No Response Is Filed
   
   

• If you fail to respond within 15 days and do not request an extension, the original return will be treated as invalid by the Income Tax Department.
  
  

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Consequences of Ignoring a Defective Return Notice (Section 139(9))

If you do not respond to the notice or fail to revise your return, the following consequences apply:

1. Your Return Becomes Invalid
   
   

• The Income Tax Department will treat your original return as not filed, meaning it holds no legal validity.
  
  

2. Refunds Will Not Be Processed
   
   

• If a tax refund was due, it will not be issued until a valid return is filed.
  
  

3. Penalty for Late Filing
   
   

• If your return becomes invalid, you may need to file a belated return along with penalty fees to avoid further legal consequences.
  
  

How Will You Receive a Notice Under Section 139(9)?

You will receive a defective return notice (Section 139(9)) via email at the registered email ID used while filing your Income Tax Return (ITR).

• These notices are typically issued by the Centralized Processing Center (CPC).
  
  

• The subject line of the email will be:
  "Communication u/s 139(9) for PAN [Your PAN] for the A.Y. [Assessment Year]."
  
  

• The notice is attached as a password-protected PDF file.
  
  

• Password Format: Your PAN (in lowercase) + Date of Birth (DDMMYYYY).
  
  

Time Limit to Respond to a Defective Return Notice

You are required to rectify the defect within 15 days from the date of receiving the notice (or within the time limit specified in the notice).

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Can You Withdraw Your Response to a Defective Notice (Section 139(9))?

Previously, taxpayers could withdraw their response after submitting it. However, this option is no longer available.
Instead, you can only update or view your response, but withdrawal is not possible.

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How to Revise Your Income Tax Return in Response to the Notice?

Receiving a tax notice should not be a cause for concern. Instead, it’s an opportunity to correct any mistakes in your original return.

Under Section 139(5) of the Income Tax Act, taxpayers have the right to revise their ITR to correct errors or omissions.

Key Points About Revising an ITR:

• A revised return can be filed before the earlier of:
  
  

1. One year from the end of the relevant Assessment Year.
   
   

2. Completion of the assessment.
   
   

• This flexibility allows taxpayers to correct discrepancies and ensure that their tax filings are accurate.
  
  

If you receive a defective notice, promptly revising your return will help avoid any legal or financial consequences.

How to Respond to a Defective Return Notice Under Section 139(9)?

Follow these steps to reply to a defective return notice under Section 139(9) of the Income Tax Act:

1. Read the Notice

Carefully review the notice to understand the errors or missing details highlighted by the Income Tax Department.

2. Gather Required Documents

Collect all necessary documents and information needed to correct the issues mentioned in the notice.

3. Make Corrections

Modify your income tax return by fixing the errors and ensuring all required details and supporting documents are included.

4. Draft Your Response

Prepare a response that includes:

• The reference number of the notice.
  
  

• A clear explanation of the corrections made.
  
  

• Any additional documents or details requested.
  
  

5. Submit Your Response

• Online: Log into the Income Tax e-filing portal, follow the instructions, and upload the corrected return or response.
  
  

• By Mail: If required, print your response and send it via post or submit it in person to the tax office.
  
  

6. Keep a Copy

Retain copies of the original return, the notice, and your response for future reference.

7. Follow Up

Regularly check your tax account on the e-filing portal or contact the tax office to ensure that your response has been received and processed.

FAQs on Defective Return Notice Under Section 139(9)

How will I receive a defective return notice from the Income Tax Department?

You will receive an email notification from the Income Tax Department with the subject line:

"Important ‐ Rectify the defect in your Return of Income."

Additionally, the department also sends an SMS alert to inform taxpayers that the notice has been sent to their registered email ID.

How can I pay the remaining income tax after receiving a notice under Section 139(9)?

To pay any remaining income tax after receiving a defective return notice u/s 139(9):

Pay the remaining income tax online, similar to how self-assessment taxes are paid.

File a revised return and generate the JSON file for the updated return.

Log in to the Income Tax e-filing portal.

Navigate to the e-file dropdown and select “e-file response u/s 139(9).”

Upload the generated JSON file in response to the notice.

Once the revised return and response are successfully submitted, your compliance under Section 139(9) is complete.

If I have already filed a revised return in response to Section 139(9), do I still need to respond separately?

In most cases, you can submit compliance with the "Disagree" option, mentioning that the return has been revised. However, the appropriate response may vary based on your specific case. It is advisable to seek guidance from tax experts for further assistance.

What is Section 139(9) of the Income Tax Act?

Section 139(9) of the Income Tax Act is applicable when an income tax return contains errors, missing information, or incorrect details. If a return is found to be defective, the taxpayer receives a notice under Section 139(9) and is given 15 days to rectify the issues.

If a taxpayer fails to respond within the given timeframe, they can request an extension by writing to the department. Otherwise, the return may be considered invalid, which can lead to further tax implications.

What does Error Code Rule 37BA mean in a notice under Section 139(9)?

When responding to a defective return notice, Error Code Rule 37BA is commonly encountered. This error occurs when the total receipts reported under all heads of income in your ITR are less than the gross receipts reflected in Form 26AS. This discrepancy must be corrected while responding to the notice.

How do I correct a defective income tax return?

A defective return can be corrected by either:

Filing a revised return with the necessary corrections.

Submitting a response to the defective notice through the e-filing portal.

What happens if a taxpayer does not accept or respond to a defective return notice?

If you fail to respond to a defective return notice within the given timeframe, your ITR for the assessment year may become invalid. This means that, legally, you will be considered as not having filed a return for that financial year.

Consequences of an invalid return include:

Penalties and interest charges for late or non-filing.

Loss of carryforward benefits for business losses.

Denial of certain tax exemptions and deductions.