Mandatory ITR Filing under the Seventh Proviso to Section 139(1) – myITreturn Help Center

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Applicable period: FY 2025-26 | AY 2026-27
Applicable law: Seventh proviso to section 139(1) and Rule 12AB of the Income-tax Rules, 1962

A person may be required to file an income-tax return even when total income does not exceed the applicable basic exemption limit. The seventh proviso to section 139(1), together with Rule 12AB, identifies specified financial and economic conditions that trigger mandatory filing.

Key rule: These conditions are independent of the final tax payable. A person may have no tax liability because of deductions or rebate and still be required to file an ITR.

Specified Mandatory-Filing Conditions

Condition during the financial year	Threshold
Deposits in one or more current accounts with a bank or cooperative bank	Aggregate exceeds ₹1 crore
Expenditure on foreign travel for self or another person	Aggregate exceeds ₹2 lakh
Expenditure on electricity consumption	Aggregate exceeds ₹1 lakh
Total sales, turnover or gross receipts from business	Exceeds ₹60 lakh
Gross receipts from profession	Exceeds ₹10 lakh
Aggregate TDS and TCS during the year	₹25,000 or more; ₹50,000 or more for a resident individual aged 60 years or more
Deposits in one or more savings bank accounts	Aggregate ₹50 lakh or more

How the Test Works

Check each condition separately for the full financial year.
Aggregate amounts across the accounts or transactions covered by that condition.
Apply the exact wording: some thresholds require an amount to exceed the limit, while others apply at the stated amount or more.
If any one condition is met, filing becomes mandatory even if income is below the normal threshold.

Example

Assume an individual has taxable income of ₹3,20,000 under the default new tax regime for AY 2026-27, but deposits ₹55 lakh in savings accounts during FY 2025-26. The person meets the Rule 12AB savings-deposit condition and must file an ITR even though income is below ₹4 lakh.

Deposit is not the same as income. Meeting a deposit threshold creates a filing obligation, but it does not automatically mean the entire deposit is taxable. The source and taxability of the funds must be examined separately.

Which ITR Form Should Be Used?

The trigger does not decide the ITR form. Select the form according to the taxpayer category and income sources. For example, an eligible salaried resident may use ITR-1, while a person with capital gains may need ITR-2 and a person with business income may need ITR-3 or ITR-4.

Common Mistakes

Checking only taxable income and ignoring high-value conditions.
Treating tax rebate as exemption from the filing requirement.
Ignoring TDS or TCS because a refund is expected.
Confusing total bank deposits with closing balance.
Assuming that separate accounts are tested individually when the rule requires aggregation.

Practical step: Review bank statements, travel payments, electricity bills, turnover records and Form 26AS before deciding that filing is optional.

Income-tax Act, 2025 Transition

AY 2026-27 relates to income earned in FY 2025-26 and remains governed by the Income-tax Act, 1961. The Income-tax Act, 2025 applies prospectively to tax year 2026-27 beginning on 1 April 2026. The correct law must therefore be selected according to the year in which the income and filing obligation arise.

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