DNA Explainer: Why the deadline for filing Income Tax returns is likely to extend beyond September 30

India’s Union Finance Minister Nirmala Sitharaman summoned Infosys MD and CEO Salil Parekh today and demanded "that the issues faced by taxpayers on current functionalities of the portal should be resolved by the 15th September 2021."

Hon'ble FM met Mr Salil Parekh MD&CEO @Infosys today & conveyed the deep disappointment & concerns of the Govt &taxpayers about continuing glitches in the new e-filing portal of ITDeptt. While seeking explanation from Infosys,FM demanded that the issues be fixed by 15th Sep,2021. pic.twitter.com/GWe5D9HxCs

— Income Tax India (@IncomeTaxIndia) August 23, 2021

On June 7, 2021, Indian tax payers were provided with an all-new online portal for e-filing of IT returns. The new portal, www.incometax.gov.in, was expected make the process easier and hassle-free for taxpayers. The portal was developed by India’s leading software company Infosys.

Several tax payers and users have had a hard time filing their ITR on the portal and have highlighted the glitches being faced. The income tax portal had been unavailable for the last two days in connection to these glitches. The portal was back available today after Infosys notified in a tweet.

In fact, this was the second such meeting between the FM and Infosys officials. Earlier, FM Sitharaman had raised the issue of resolving issues with the portal in a meeting with Infosys officials on June 22 after reports of glitches had cropped up.

A meeting was held between senior officers of Finance Ministry & @Infosys on 22.06.2021 on issues in new Income Tax Portal.The meeting was presided over by Hon’ble FM, Smt. @nsitharaman. MoS(Finance), Sh @ianuragthakur also participated in the meeting(1/5)https://t.co/USjZV486W7 pic.twitter.com/0dDLiyuWJx

— Income Tax India (@IncomeTaxIndia) June 22, 2021

Infosys was awarded the government contract to create a new advanced income tax filing portal in 2019. As reported by the Economic Times, the company has been paid Rs 164.5 crore for the project till June 2021.

What are the technical glitches with the new portal being faced by tax payers?

The new income tax portal offers a number of assistive features to tax payers for a seamless filing process. These features include pre-filled income tax return forms, immediate ITR processing, free IT preparation software, single dashboard, multiple payment options and quick refunds.

Nevertheless, tax payers and consultants have been facing a range of technical glitches since the portal came into operation that have resulted in a longer ITR filing time and processing with time lag.

Tax payers reported receiving certain erroneous reports from the portal. In some instances, the ITR acknowledgement from the portal that is generated after a user has filed return were watermarked showing that ITR is not filed for some days.

Both these pictures are clicked just now. All Tax Professionals might be sitting idle, just because of you. Thank you for ruining everything in the name of ease of doing business @nsitharaman @nsitharamanoffc @IncomeTaxIndia @Infosys_GSTN @cbic_india @Infosys @narendramodi pic.twitter.com/MAaKpWot4G

— CA Narayan Bhattad (@NarayanBhattad) August 21, 2021

As one tax consultant pointed out to a leading news website, an issue with FORM 10A, which is filed by non-profits in India to continue availing exemptions under the Section 12A of The Income Tax Act deactivated access to important details like balance sheet details. If the assessee is not careful, this their forms can get rejected without these details.

How likely is an Income Tax Return filing deadline extension?

In lieu of these glitches, tax experts and consultants believe that the Central Board of Direct Taxes (CBDT) is likely to extend the deadline for filing of income tax returns and other similar deadlines like that of filing Form 10A for the assessment year 2021-22 (FY21).

One tax expert stated that expecting an extension of the deadline for filing due to the hardships faces is natural for tax payers and consultants.

Tax experts claim that the glitches have led to an increase in the number of man-hours needed to file tax returns. Expecting the issues to be resolved in some weeks, many had postponed their dates for filing returns.

An extension of the deadline by tax authorities will also allay the anxiety among many tax payers and consultants who have been waiting for a seamless experience before making their filings.