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CA Intermediate · Taxation · Provisions for filing Return of Income and Self Assessment

Arjun, a resident individual, has a total income of Rs 3,50,000 for tax year 2026-27, below the basic exemption limit. During the year he deposited Rs 1,20,00,000 in a current account with a bank. He has no other triggering transactions. Which statement is correct under the Income-tax Act, 2025?

Arjun must file a return, because the law compels filing where aggregate deposits in one or more current accounts during the year are Rs 1 crore or more, irrespective of total income. His deposits of Rs 1.20 crore cross this threshold even though his income is below the exemption limit.

  1. AHe need not file a return as his income is below the exemption limit
  2. BHe must file a return because aggregate deposits in one or more current accounts exceed Rs 1 croreCorrect
  3. CHe must file a return only if the deposit exceeds Rs 2 crore
  4. DHe must file a return only if tax is payable

Explanation

A person who deposits an aggregate amount of Rs 1 crore or more in one or more current accounts during the year must file a return, regardless of the level of total income. Rs 1.20 crore exceeds this limit. Option A ignores this specific trigger. The Rs 2 crore limit in option C is wrong for current account deposits.

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