Section 263 · Returns
Section 263 of the Income-tax Act, 2025 — Return of Income (ITR Filing, Due Dates, Belated, Revised & Updated Returns)
By CA Rajat Agrawal
Updated 05 Jul 2026
Chapter XV
📜 What the law says — Section 263, Income-tax Act 2025
263. (1)(a) Every person as mentioned below shall, for a tax year, on or before the
due date, furnish a return of his income or the income of any other person in
respect of which he is assessable during the said tax year:—
43. Substituted for “pertaining to business or profession” by the Finance Act, 2026, w.e.f. 1-4-2026.
(i) a company;
(ii) a firm;
(iii) a person other than a company or a firm, if his total income or the total
income of any other person in respect of which he is assessable under this
Act during the tax year, without giving effect to the provisions of Chapter
XVII-B or provisions of Schedule VIII (Table: Sl. No. 1) or deductions
allowable under section 82 or 83 or 84 or 85 or 86 or 87 or 88 of Chapter
IV-E or Chapter VIII, as the case may be, exceeded the maximum amount
which is not chargeable to income-tax;
(iv) a specified entity, if its total income without giving effect to the provisions
of section 11 exceeds the maximum amount which is not chargeable to
income-tax;
(v) a University, college or other institution as referred to in section 45(3)
(a);
(vi) a business trust;
(vii) an investment fund as referred to in section 224;
(viii) a person who has sustained a loss in the tax year under the head “Profits
and gains of business or profession” or under the head “Capital gains”
and who intends to claim that such loss, or any part thereof, is to be
carried forward as per this Act;
(ix) a person, who is a resident, other than not ordinarily resident, and who
at any time during the tax year,––
(A) holds, as a beneficial owner or otherwise, any asset (including any
financial interest in an entity) located outside India, or has signing
authority in any account located outside India; or
(B) is a beneficiary of any asset (including any financial interest in an
entity) located outside India, except where any income arising from
such asset is includible in the income of person referred to in item
(A);
(x) a person, other than a company or firm, who during the tax year, fulfils
such conditions as may be prescribed;
(b) the persons referred in clauses (a)(i), (a)(ii), (a)(v), (a)(vi)
In plain language
What Section 263 is about
Section 263 of the Income-tax Act, 2025 (effective from 1 April 2026, as amended by the Finance Act, 2026) is the single, unified provision that governs the filing of the income tax return (ITR). It is the direct replacement of the old and much-litigated Section 139 of the Income-tax Act, 1961 (and also absorbs old Sections 139D and 194P). The big drafting improvement is that everything about returns now lives in one place — the original return, the belated return, the revised return, the updated return (ITR-U), defective returns and the power to exempt certain people are all sub-sections of Section 263.
Who must compulsorily file a return
Under Section 263(1), some persons must file irrespective of income or even if they have a loss, while others must file only if income crosses the basic exemption limit.
- Always file (no income test): every company (Indian or foreign) and every firm/LLP — even a dormant company with nil income.
- Individuals / HUFs / AOPs / BOIs: must file if total income before Chapter-level deductions and exemptions exceeds the basic exemption limit — ₹4,00,000 under the new default regime and ₹2,50,000 under the old regime (higher slabs apply for senior and super-senior citizens under the old regime).
- Loss carry-forward cases: anyone with a loss under "Profits and gains of business or profession" or "Capital gains" who wants to carry it forward must file on time.
- Foreign asset holders: a resident (other than RNOR) who is a beneficial owner of any asset outside India, holds foreign accounts, or has signing authority abroad — filing is mandatory even with zero Indian income.
- Specified entities: charitable trusts, research associations, universities/colleges, mutual funds, business trusts, investment funds and others listed in the section.
- Others as prescribed: the Board can prescribe additional high-value-transaction triggers (e.g. large bank deposits, high electricity spend, big foreign-travel expenditure, business turnover above notified limits) that force a return even below the exemption limit — carried over in substance from the old "seventh proviso" to Section 139(1). Confirm the exact current rupee triggers from the relevant Rules/notification before relying on them.
Due dates (Tax Year 2026-27)
- 31 July — salaried and simple-income individuals (ITR-1 / ITR-2 type).
- 31 August — business/professional taxpayers not subject to audit (a Finance Act, 2026 extension from the earlier 31 July).
- 31 October — companies and taxpayers who must get accounts audited, and their working partners.
- 30 November — taxpayers required to file a transfer-pricing report (Section 172).
The four flavours of return
- Original return — Section 263(1): filed on or before the due date.
- Belated return — Section 263(4): if you miss the due date, you can still file within 9 months from the end of the tax year, or before assessment is completed, whichever is earlier (so 31 December 2027 for TY 2026-27). A late fee under Section 271 applies (₹5,000, reduced to ₹1,000 if total income is up to ₹5 lakh) and most losses cannot be carried forward.
- Revised return — Section 263(5): if you spot a genuine mistake or omission, you can revise within 9 months from the end of the tax year or before assessment, whichever is earlier. (Note: some portals quote 12 months — the Act's text says 9 months; treat 9 months as the safe reading.)
- Updated return / ITR-U — Section 263(6): a voluntary honesty window of 48 months from the end of the tax year (31 March 2032 for TY 2026-27) to disclose missed income, at the cost of additional tax under Section 267.
Defective returns and exemptions
- Section 263(7): a return with a wrong form, missing schedules, unpaid self-assessment tax or absent financial statements is "defective"; the Assessing Officer gives about 15 days to cure it before it becomes invalid.
- Section 263(3): the Central Government may notify classes of persons (e.g. certain senior citizens whose bank has deducted tax) who need not file at all.
Practical implications
- Filing on time protects your right to carry forward business and capital losses — a belated return loses this benefit.
- Refund claims require a return, so even low-income earners with excess TDS should file.
- ITR-U cannot be used to reduce tax, claim/increase a refund, or file a loss return, and only one ITR-U is allowed per tax year.
💡 Example
Example 1 — Belated return and late fee. Rohan, a salaried employee, has total income of ₹9,20,000 for TY 2026-27. His due date is 31 July 2027 but he files on 5 November 2027. Because his income exceeds ₹5 lakh, he pays a late fee of ₹5,000 under Section 271, plus interest under Section 234A on any unpaid tax. Had his income been only ₹4,60,000, the late fee would have been just ₹1,000. He can still file this belated return up to 31 December 2027 under Section 263(4), but he loses the right to carry forward any capital loss.
Example 2 — Updated return (ITR-U). Meena forgot to report ₹1,50,000 of freelance income for TY 2026-27. In February 2029 she files an updated return under Section 263(6). She pays the normal tax on the ₹1,50,000 plus the additional tax under Section 267 (a percentage that rises the longer she waits — broadly 25% to 70% of the aggregate of tax and interest). She can do this any time up to 31 March 2032, but only once, and it cannot be used to increase a refund.
A short story. Arjun, a 29-year-old with income just below the ₹4 lakh limit, thought he never needed to file. But he had spent ₹3 lakh on a foreign holiday and had a large current-account turnover — high-value triggers the Board can prescribe under Section 263. His CA explained that these transactions can make a return compulsory even with low income, and that filing anyway built a clean record for his upcoming home-loan application. Arjun filed on time, avoided a notice, and got his loan approved faster.
| Return type | Sub-section | Time limit (from end of tax year) | For TY 2026-27 | Key cost / restriction |
|---|
| Original return | 263(1) | On/before due date | 31 Jul / 31 Aug / 31 Oct / 30 Nov 2027 | No late fee if on time |
| Belated return | 263(4) | 9 months (or before assessment) | 31 Dec 2027 | Late fee ₹1,000–₹5,000; most losses lapse |
| Revised return | 263(5) | 9 months (or before assessment) | 31 Dec 2027 | Corrects genuine errors |
| Updated return (ITR-U) | 263(6) | 48 months | 31 Mar 2032 | Extra tax under s.267; one per year; no refund/loss |
| Defective return notice | 263(7) | ~15 days to cure | — | Becomes invalid if not fixed |
Related sections
Section 264 — Return of loss (mandatory to carry forward) Section 267 — Tax on updated return (additional tax) Section 271 — Fee for default in furnishing return Section 172 — Transfer pricing report and 30 Nov due date Section 268 — Self-assessment tax before filing return Section 270 — Interest for default in furnishing return (234A equivalent)
Frequently asked questions
Is Section 263 the same as old Section 139?
Yes. Section 263 of the Income-tax Act, 2025 replaces Section 139 of the 1961 Act and also absorbs old Sections 139D and 194P. All return-filing rules — original, belated, revised and updated — are now unified in this one section.
What is the last date to file a belated return for TY 2026-27?
Under Section 263(4) you can file a belated return within 9 months from the end of the tax year or before assessment is completed, whichever is earlier — that is 31 December 2027 for TY 2026-27, with a late fee under Section 271.
Do I have to file even if my income is below ₹4 lakh?
Sometimes yes. Companies and firms always file. Individuals below the exemption limit may still be required to file if they want to carry forward losses, hold foreign assets, are claiming a refund, or cross prescribed high-value transaction triggers (like large deposits or big foreign-travel spend).
How long do I get to file an updated return (ITR-U)?
Section 263(6) allows an updated return within 48 months from the end of the tax year — up to 31 March 2032 for TY 2026-27. It requires extra tax under Section 267 and cannot be used to reduce tax or claim/increase a refund.
Can I revise my return after filing?
Yes. Under Section 263(5) you can revise a return to correct a genuine omission or error within 9 months from the end of the tax year, or before assessment is completed, whichever is earlier. Some sources cite 12 months, but the Act's text reads 9 months.
What happens if my return is defective?
Under Section 263(7), the Assessing Officer will notify you and give about 15 days to fix defects such as a wrong ITR form, missing schedules or unpaid self-assessment tax. If not cured in time, the return is treated as invalid.
Which due date applies to a small business without audit?
For non-audit business or professional income the due date is 31 August of the assessment year (extended from 31 July by the Finance Act, 2026). Audited businesses and companies file by 31 October, and transfer-pricing cases by 30 November.
C
CA Rajat Agrawal
Chartered Accountant, EaseValue · Reviewed 05 Jul 2026
This explainer is prepared and reviewed by EaseValue's tax team, based on the text of the Income-tax Act, 2025 (as amended by the Finance Act, 2026).
Disclaimer: This page explains the law in general terms for education and is not professional advice. The Income-tax Act, 2025 takes effect from 1 April 2026; provisions, thresholds and interpretations may change. Please confirm your specific position with our team before acting.
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