Decoding the Defective Return Notice u/s 139(9): Your Step-by-Step Action Plan
- Farheen Mukadam
- Aug 31
- 9 min read
Did you recently get an email from the Income Tax Department about a "defective return"? A defective notice u/s 139(9) is simply a request to fix mistakes in your tax filing; it isn't a demand for a penalty. This guide gives you a clear, step-by-step plan to understand, respond to, and resolve the income tax notice without any stress.
Table of Content
What is a Defective Return Notice Under Section 139(9)?
A defective notice u/s 139(9) is sent when your Income Tax Return (ITR) has incomplete or inconsistent information. Section 139(9) of the Income Tax Act, 1961, gives an Assessing Officer (AO) the power to issue this notice if they find errors. The main purpose of this notice is to give you, the taxpayer, a chance to correct these errors. It's important to know this is different from a scrutiny notice, which involves a more detailed examination of your accounts.
The key features of a defective return notice are:
It is a request for you to make corrections.
It is not an immediate penalty or tax demand.
It comes with a specific deadline for your response.
Top 10 Reasons You Received a Defective Notice u/s 139(9)
There are several common reasons for a defective notice, and understanding them helps in avoiding future issues. A defective notice u/s 139(9) often arises from simple mistakes that are easy to fix. Here are the top ten reasons why you might have received one:
TDS Claimed but Income Not Reported A common reason for a defective notice is claiming a Tax Deducted at Source (TDS) credit without showing the corresponding income in your ITR. For instance, if your bank deducted TDS on your fixed deposit interest, you must report that interest income.
Mismatch in Form 26AS/AIS and ITR This is a frequent reason for a defective notice. The income and TDS details in your ITR must perfectly match the information in your Form 26AS and Annual Information Statement (AIS). Any discrepancy will get flagged.
Taxes Paid but Challan Details are Incorrect/Missing If you paid self-assessment tax but entered incorrect challan details, like the BSR code or date of deposit, it can trigger a defective notice. The system can't verify your payment without the correct information.
Using the Wrong ITR Form Selecting the correct ITR form for your income sources is crucial, making it a key part of how to file ITR correctly. For example, if you have capital gains from shares, you can't use the simple ITR-1 form and must use ITR-2 or ITR-3.
Incomplete Presumptive Income Details (Sec 44AD, 44ADA) Another reason for a defective notice is not filling out the details for the Presumptive Taxation Scheme correctly. If you opt for this scheme, you must report your gross turnover and declare the required percentage of profit.
Missing Balance Sheet and P&L Statement Taxpayers with income from a business or profession must file a Balance Sheet and a Profit & Loss (P&L) Account with their ITR. A defective notice u/s 139(9) will be issued if these financial statements are missing.
Gross Receipts Mismatch A gross receipts mismatch is a significant reason for a defective notice. For example, if your ITR-4 shows gross receipts over Rs. 2 crore, it will be considered defective as it exceeds the presumptive scheme's limit. Also, the gross receipts in your P&L account must match the receipts shown in your Form 26AS.
Name Mismatch (PAN vs. ITR) A simple name mismatch between your PAN card and the ITR you filed is a common reason for a defective notice. The name must be exactly the same as it appears in the PAN database.
Mandatory Audit Report Not Filed (Sec 44AB) If your business turnover exceeds the specified limits, a tax audit under Section 44AB is mandatory. Failing to file the tax audit report along with your ITR is a sure-shot reason for a defective notice.
Negative Amount in Gross Total Income A defective notice may be issued if you report a negative figure in your Gross Total Income. While you can have losses under certain income heads, the final Gross Total Income figure is generally expected to be positive after set-offs.
How to Respond to a Defective Notice u/s 139(9)
Knowing how to respond to a defective notice is essential for every taxpayer. The e-filing portal provides a straightforward way to submit your response and revise your return if needed. The process involves analyzing the notice, preparing your response, and submitting it electronically.
Step 1: Locating and Understanding the Notice
The journey to respond to a defective notice u/s 139(9) begins with finding the notice itself. The Income Tax Department sends the notice to your registered email address from the Centralized Processing Center (CPC). The attached PDF file is password-protected for security. To open it, you need to enter your PAN in lowercase letters followed by your date of birth in DDMMYYYY format. For example, if your PAN is ABCDE1234F and your date of birth is January 5, 1990, the password would be abcde1234f05011990.
You can also find the notice on the income tax e-filing portal by logging in and navigating to the 'Pending Actions' tab, then clicking on 'E-proceedings'.
Step 2: Choosing Your Response - Agree vs. Disagree
After understanding the defect, you must decide how to respond. The e-filing portal gives you two main options: you can either 'Agree' or 'Disagree' with the defect mentioned in the notice.
Agree: Choose this option if you recognize the error and accept that it needs correction. This path will lead you to file a corrected return.
Disagree: Select this option if you believe your original return was correct and the notice was issued due to a misunderstanding or a system error. You will need to provide a strong reason for your disagreement.
Step 3 (Path A): Responding if You AGREE with the Defect
If you need to revise your return u/s 139(9) because you agree with the defect, the process is clear. First, you must prepare the correct ITR using the offline utility tool. Make the necessary corrections as pointed out in the notice. After correcting the errors, generate the new ITR data file, which will be in a JSON format.
Next, log in to the e-filing portal and follow these steps:
Navigate to 'Pending Actions' > 'E-proceedings' and find the relevant notice.
Click 'Submit Response' and select the 'Agree' option.
Choose the 'Offline utility' as your mode of response.
Upload the newly generated JSON file of your corrected ITR.
After successful submission, you will receive a confirmation with an acknowledgement number. Be sure to e-verify your corrected return.
Step 4 (Path B): Responding if You DISAGREE with the Defect
If you want to submit a response indicating disagreement, the steps are different. This option is crucial if your original filing was accurate. For instance, a TDS mismatch might occur because the deductor filed their TDS return late, but your income reporting was correct.
To respond when you disagree:
On the response page, select the 'Disagree' option.
A text box will appear where you must provide a detailed justification for your disagreement.
Clearly explain why you believe the defect is incorrect. For example, state that "The income reported is accurate as per my records, and the mismatch in Form 26AS is due to the deductor's delayed TDS filing."
Attach any supporting documents if necessary to strengthen your case.
Submit your response.
Critical Timelines and Consequences of Non-Compliance
Understanding the time limit for a 139(9) response is absolutely critical. The law gives you 15 days from the date you receive the notice to rectify the defect. If you ignore this deadline, there can be serious consequences of not responding.
The primary consequences of inaction include:
Your return will be treated as an invalid return, which means it's considered as if you never filed it in the first place.
You might lose the ability to claim exemptions and deductions you had originally listed.
The carry-forward of any losses to future years will not be permitted.
You could face penalties and interest for the non-filing of your ITR, as your original return is now invalid.
How to Request an Extension?
If you realize you cannot meet the 15-day deadline, there is a way to request more time. You can apply for an extension by writing a letter to your jurisdictional Assessing Officer (AO). In the letter, you should clearly state the reason for the delay and mention the date by which you expect to comply. You can find your AO's details on the income tax portal after logging into your account.
Proactive Checklist: How to Avoid a Defective Return Notice
To avoid a defective notice in the future, it is best to be proactive. A simple ITR filing checklist can help you file your ITR correctly and prevent common mistakes. By double-checking a few key things before you submit, you can ensure a smoother filing experience.
Here's a checklist to review:
[ ] Reconcile all your income sources with Form 26AS, AIS, and TIS to ensure everything matches.
[ ] Select the correct ITR form that is applicable to your specific income profile.
[ ] Report all active bank accounts you held during the financial year.
[ ] Ensure there is no mismatch in your name as it appears on your PAN card and your ITR.
[ ] Double-check the challan details for any self-assessment or advance tax payments you've made.
[ ] File the necessary audit reports under section 44AB if they are applicable to you.
Conclusion: Taking Control of Your Tax Filing
To ensure accurate tax filing, remember that a defective notice u/s 139(9) is a manageable issue. It is a chance to correct your mistakes, not a punishment. The most important thing is to act quickly within the 15-day window, carefully understand the exact defect, and submit a proper response. By staying diligent and organized, you can easily stay compliant and file your taxes with confidence. If you find the process overwhelming, don't hesitate to get expert assistance from TaxBuddy.
Frequently Asked Questions (FAQ)
1. What is the time limit to respond to a defective notice u/s 139(9)?
You have 15 days from the date you receive the notice to respond and rectify the errors.
2. How do I open the password-protected notice file?
The password to open the PDF notice is your PAN in lowercase, immediately followed by your date of birth in DDMMYYYY format, with no spaces.
3. What happens if I don't respond to the notice?
If you don't respond within the given time, your ITR will be treated as an invalid return. This can lead to penalties, loss of deductions, and the inability to carry forward losses.
4. Can I authorise another person to respond on my behalf?
Yes, you can authorize another person, like a Chartered Accountant, to respond to the notice on your behalf.
5. Can I file a revised return instead of responding to this notice?
If the deadline for filing a revised return for that assessment year has not passed, you can file a revised return. However, once that deadline is over, you must respond to the 139(9) notice specifically.
6. Is a notice u/s 139(9) the same as a scrutiny notice?
No, they are different. A 139(9) notice is a request to correct specific errors, while a scrutiny notice involves a detailed examination of your financial affairs by the tax department.
7. What is the difference between a 'defective return' and an 'invalid return'?
A defective return has errors that can be corrected within a specific time. If you fail to correct it, the return becomes an invalid return, which is treated as if you never filed it.
8. Can I get an extension on the 15-day deadline?
Yes, you can request an extension by writing to your Assessing Officer and explaining the reason for the delay.
9. Where can I find my Assessing Officer's details to request an extension?
You can find your jurisdictional Assessing Officer's details by logging into the Income Tax e-Filing portal.
10. What evidence should I provide if I disagree with the notice?
If you disagree, provide a clear, written justification in the response text box on the portal. You can refer to bank statements, TDS certificates, or any other relevant documents that support your claim.
11. Will I be penalised for a defective return?
No penalty is levied just for having a defective return. Penalties may apply only if you fail to respond to the notice and correct the defect within the specified time.
12. The defect is because my employer/bank made a mistake in TDS filing. What should I do?
You should immediately contact the deductor (your employer or bank) and ask them to file a revised TDS return to correct the mistake. In your response, you can state that the deductor is in the process of correcting their filing.
13. I have already filed a revised return before getting this notice. Do I still need to respond?
If the portal shows that your latest return has been taken for processing, no further action may be required. However, it is best to check the 'e-proceedings' section to confirm if the notice is still active and needs a formal response.
14. The portal shows 'No e-proceedings records'. What does this mean?
This message means there are currently no active notices or proceedings pending for your action from the Income Tax Department.
15. Can I correct the defect online without using the offline utility?
For most corrections that require changing ITR data, you must use the offline utility to prepare a corrected JSON file and then upload it. The portal itself is used to submit the response and upload this file.
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