Tax relief under section 89(1)
My mother (age 79) is a retired teacher in WB. She retired on 31 July 2004. She opted for CPF scheme and got a one-time payment during retirement for the Employer’s share of CPF & Gratuity. She didn't get any monthly pension.
After winning a court case, she converted to monthly pension by paying back the one-time payment with interest to the Govt of WB in 2014. From the next day (21 Aug 2014), Govt started paying her monthly pension.
However, the Govt refused to pay the arrear pension from 1 Aug 2004 to 20 Aug 2014. After winning another court case, the Govt paid the arrear pension on 03 Jan 2024.
As my understanding, my mother is eligible for the Tax Relief under Section 89(1) for the arrear pension.
However, a tax consultant told me that she would be eligible for Tax Relief under Section 89(1) only if she filed IT returns every year from 1 Aug 2004 to 20 Aug 2014. Is it true?
By logging in to the e-filing portal, I see she filed ITR from A.Y. 2011-12 to current A.Y. By searching files at home, I see ITR was filed since A.Y. 2009-10. Either she didn’t file ITR from A.Y. 2005-06 to 2008-09, or the paper was lost from her file. She can’t remember it. My father handled these matters, who is no more.
Under this situation, is she eligible to get the Tax Relief for the arrear pension under Section 89(1) from A.Y. 2005-06 to 2008-09?
I found issues in the ITR of every year from A.Y. 2009-10 to 2013-14. She had no salary, pension, or business income. She had only some interest income from bank accounts and FD, which is far below the basic exemption limit. However, the ITRs reported too much higher income than she actually had (below the basic exemption limit).
For example, in the ITR-1 of A.Y. 2012-13:
Income from Salary / Pension- Rs. 1,49,075
Income from Other Sources- Rs. 54,000
Gross Total Income- Rs. 2,03,075
Total Income- Rs. 2,03,080
[This mistake was possible due to the tax consultant who filed the ITRs. He used to report higher income when the actual income was very low. I know this from my own ITR experience with him.]
Arrear pension received for A.Y. 2012-13: Rs. 2,01,732
In both court cases, it is documented that she didn’t receive any pension for the period 1 Aug 2004 to 20 Aug 2014.
In Annexure 1 - TABLE "A" of FORM NO. 10E in the “Total income of the relevant previous year” column, what amount should we write for A.Y. 2012-13? Is there any provision to calculate the ‘Income from Salary / Pension’ as 0 (zero) in such a situation?
If she is eligible to get the Tax Relief from A.Y. 2005-06 to 2008-09 (either she didn’t file ITR or the paper was lost from her file), what amount should we write in the above-mentioned column for all the respective A.Y.?
Will we file Form 10E after 31 March 2024?
How many days before filing the ITR of A.Y. 2024-25 we’ll file the Form 10E?
Do we need approval from the Income Tax department for the filed Form 10E before filing the ITR?
Asked 10 months ago in Income Tax
It is documented in the court cases that my mother didn’t receive a pension from 1 August 2004 to 20 August 2014.
But, as per Shubham Goyal’s reply under “3. Addressing Past Inaccuracies”,
In Form 10E, if she reports zero pension income for A.Y. 2012-13 (despite having the Pension income of Rs. 1,49,075 filed in the ITR-1 of A.Y. 2012-13), will it not create a high chance of receiving an IT notice since this will create a mismatch from the amounts already reported in the ITR?
If she receives the IT notice and replies with the court’s order, will the notice be resolved in her favor?
Asked 5 months ago
