Form 2C not valid anymore, file ITR-3 instead

SC Vasudeva

Q. Under proviso to Section 139(I)(b) certain persons fulfilling any one condition mentioned in Clauses (I), (II), (IV), (V), (VI) are required to file their income tax return in form 2C framed under rule 12(I)(d) even though their income did not exceed the maximum amount not chargeable to income tax.

a) Please let me know whether above provisions are still in force or their application has been restricted to “income during any previous year ending before the 1st day of April 2005” as provided by the Finance Act 2006 w.e.f. 1.4.2006.

b) And whether rule 12(I)(d) and form No. 2C have been omitted, if so from which date? — Avtar Kishan Kapoor

A.Your queries are replied hereunder:

a) Form 2C is not required to be filed from assessment year 2006-07 onwards.

b) Rule 12(I)(d) is now applicable to an individual or Hindu Undivided Family, other than referred to in clause (a) or clause (b) or clause (c) or clause (ca) and who has income from proprietary business or profession. The requisite form which is required to be filed is ITR-3 for assessment year 2017-18.

Q. I am a senior citizen. I have already deposited Rs 1,50,000 in PPF.  What are the other instruments wherein I can invest to reduce my income tax for the AY 2018-19 (FY 2017-2018). — Raj Kumar

A. The only other avenue available for another deduction in respect of contribution is of Rs 50,000 payable towards National Pension System.  This deduction is allowable in addition to the amount deductible under Section 80C of the Act.

Q. I am a regular Punjab Government employee and a doctor. My pay is 37400+8700+25% NPA+DA. I have been provided government accommodation so HRA is not given to me. My department adds 5% of my basic pay to taxable salary amount for income tax calculation.

However, my question is HRA not given should be reduced as amount recovered and subtracted from 5% licence fee calculated on basic pay. So practically, 5% of basic pay should not be added to taxable amount for income tax calculation. Please advise. — Amar Nath Bansal

A. According to Income-tax Rules 1962 (The Rule) valuation of perquisite in respect of unfurnished residential accommodation where such accommodation is provided by the employer being Central or State Government, a sum prescribed in such Rules is required to be added to the salary. Rule 3 of the aforesaid Rules provides for the licence fee determined by the Central Government or State Government in respect of such accommodation in accordance with the Rules framed by such Government as reduced by rent paid by the employee to be added to the salary of the employee. It seems the State Government has fixed 5% of the basic salary as the licence fee in your case and therefore addition of the said 5% of basic pay is being made to your salary as perquisite value of the unfurnished accommodation provided to you.

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