Positive impactEconomy
ITR filed under old regime, tax calculated under new regime; Delhi ITAT gives taxpayer relief
Mint 2 hrs ago·17 Sept 2026, 2:30 am
A recent ruling by the Delhi Income Tax Appellate Tribunal (ITAT) has clarified a common filing error for taxpayers. The tribunal ruled that if a taxpayer's actual tax liability was calculated under the new tax regime, the Income Tax Department must accept the return filed under the old regime. This decision prevents the tax department from arbitrarily rejecting a return due to a minor administrative mismatch between the selected regime and the actual tax computation.
This ruling is significant as it protects individual taxpayers from harsh penalties for clerical mistakes. It ensures that the tax liability is determined based on the actual calculation rather than the form selection, providing a layer of protection for those who may have been confused by the new tax laws introduced in the Union Budget 2023.
Investors should monitor how the tax department responds to this ruling. If the department accepts this interpretation, it could reduce the number of rejected returns and streamline the filing process. However, taxpayers should still ensure their ITRs are accurate to avoid any future complications.
Excerpt from Mint
A Delhi ITAT ruling has given relief to a taxpayer whose accountant mistakenly selected the old tax regime in ITR-1 even though tax had been computed under the new regime. The tribunal directed the AO to compute the taxpayer’s liability under the new regime. A taxpayer cannot be made to pay higher tax merely because…Read the original at Mint
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