Section 263 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Sub-sections (2) to (9) of section 263 deal with everything that comes after the basic duty to file: the form of the return, a belated return, a revised return, an updated return and the cases in which it is barred, a defective return and the meaning of the terms used. This article explains them as per the Income-tax Act, 2025 as amended by the Finance Act, 2026. Sub-section (1), who must file and the due dates, is in a sister article.
A belated return can be filed within nine months from the end of the tax year or before completion of assessment, whichever is earlier. A revised return can be filed within twelve months from the end of the tax year (or before assessment), subject to section 428(b). An updated return can be filed within forty-eight months from the end of the financial year succeeding the tax year, but not in the cases in sub-section (6)(c) and (d). A defective return must be rectified within fifteen days or it is treated as not filed.
By section 1(3), the Act is in force from 1 April 2026, save as otherwise provided. Section 263 is shown as amended by section 66 of the Finance Act, 2026: sub-sections (5) and (6)(b) are printed as substituted, words are inserted in sub-section (6)(c)(i) and (v), and the reference in sub-section (6)(e) is substituted, all with effect from 1 April 2026. This article follows the text as it now stands. Later amendments, rules and notifications should be checked. For an updated return, see our updated return (ITR-U) service.
Form and exemption: sub-sections (2) and (3)
Sub-section (2). The Board may prescribe the form for furnishing the return, the manner of its verification and other particulars, including the classes of persons who must file in electronic form, the documents that need not accompany an electronic return but must be produced on demand, and particulars such as exempt income, assets held, bank accounts, prescribed expenditure and the audit report under section 63. The detail is left to the Income-tax Rules, 2026; see our rule-wise guides.
Sub-section (3). The Central Government may, by notification, exempt any class or classes of persons from the obligation to file a return under the section, subject to the conditions specified. What has been notified is not in the text consulted.
Belated return: sub-section (4)
A person who has not furnished a return within the time allowed under sub-section (1) may furnish it for any tax year within nine months from the end of the relevant tax year, or before the completion of the assessment, whichever is earlier.
Revised return: sub-section (5)
If a person who has furnished a return under sub-section (1) or (4) discovers any omission or wrong statement, he may, subject to section 428(b), furnish a revised return at any time within twelve months from the end of the relevant tax year, or before completion of the assessment, whichever is earlier. Section 428 is the section on fees for default; see our post on section 428.
Updated return: sub-section (6)
The window: clause (a)
Any person, whether or not he has furnished a return under sub-section (1), (4) or (5), may furnish an updated return of his income, or the income of any other person for which he is assessable, within forty-eight months from the end of the financial year succeeding the relevant tax year. The additional tax on an updated return is dealt with in section 267; see our post on section 267, the updated return.
Loss cases and notice cases: clause (b)
- (i) Clause (a) continues to apply for a tax year if a person has sustained a loss and furnished a return of loss within the due date in sub-section (1), and the updated return is a return of income, or has the effect of reducing the loss.
- (ii) Clause (a) also applies where an updated return is furnished for the relevant tax year in pursuance of a notice under section 280, within the period specified in the notice, and the assessee is then precluded from filing a return in pursuance of the notice in any other manner. Section 280 is explained in our post on the reassessment notice.
When an updated return is not available: clause (c)
Clause (a) does not apply for a tax year if:
| Item | Bar |
|---|---|
| (i) | The updated return is a return of loss for the tax year (except in the case in clause (b)(i)) |
| (ii) | It has the effect of decreasing the total tax liability determined on the basis of the return under sub-section (1), (4) or (5) |
| (iii) | It results in a refund where no refund was due, or increases the refund due on the basis of those returns |
| (iv) | An updated return has already been furnished for the tax year |
| (v) | Any proceeding for assessment, reassessment, recomputation or revision is pending or completed for the tax year (except in the case in clause (b)(ii)) |
| (vi) | The Assessing Officer has information regarding violation of specified laws that was communicated to the person before the updated return is furnished |
| (vii) | Information has been received under an agreement referred to in section 90 or 90A of the Income-tax Act, 1961 or section 159 of this Act, and communicated to the person before the updated return is furnished |
| (viii) | Prosecution proceedings under Chapter XXII have been initiated for the tax year before the updated return is furnished |
| (ix) | Thirty-six months have expired from the end of the financial year succeeding the relevant tax year and a show-cause notice under section 281 has been issued, except where an order under section 281(3) determines it is not a fit case to issue a notice under section 280 |
| (x) | He is a person, or belongs to a class, as notified by the Board |
Searches, surveys and notices: clause (d)
A person is also not eligible where (i) a search is initiated under section 247 or a requisition is made under section 248; (ii) a survey is conducted under section 253 (other than sub-section (4)); or (iii) a notice is issued under section 294 in pursuance of section 295, for that tax year and any tax year preceding it.
Carried-forward items: clause (e)
If an updated return reduces a carried-forward loss, unabsorbed depreciation under section 33(3)(b) or a tax credit under section 206(2)(e) to (h) and 206(3) and (4) for a later tax year, an updated return shall be furnished for each such later tax year.
Defective return: sub-section (7)
A return is defective if it is not in conformity with all the conditions as may be prescribed. Then:
- (a) The Assessing Officer may intimate the defect and give the assessee an opportunity to rectify it within fifteen days from the date of intimation, or a further period allowed on application.
- (b) If not rectified within that period, the return is treated as an invalid return and the Act applies as if the assessee had failed to furnish the return.
- (c) If the defect is rectified after the period but before the assessment is made, the Assessing Officer may condone the delay and treat the return as valid.
Other provisions: sub-sections (8) and (9)
- (8)(a) Section 263 also applies to a return furnished in pursuance of an order under section 239(3)(b). (8)(b) The section does not apply to a specified senior citizen (section 402(39)) for the relevant tax year in which tax has been deducted at source under section 393(1) .
- (9) Defines "beneficial owner", "beneficiary", "specified entity" (fourteen classes by reference to Schedules III, V and VII) and "specified laws" (four other Acts, named in the section, which the reader should check).
For the earlier Act's provision, see our note on where the earlier Act's provision sits in the 2025 Act.
A worked example
The facts and the tax year are assumed (the twelve months ending 31 March 2027); only the periods are those printed in the section.
- Belated return (sub-section (4)): nine months from 31 March 2027 is 31 December 2027, or earlier if the assessment is completed first.
- Revised return (sub-section (5)): twelve months from 31 March 2027 is 31 March 2028, subject to section 428(b).
- Updated return (sub-section (6)(a)): the financial year succeeding the tax year ends on 31 March 2028; forty-eight months from that date is 31 March 2032. If the updated return would reduce his tax liability, clause (c)(ii) bars it.
- Defective return: if a defect is intimated on 10 June, he has until 25 June (fifteen days) to rectify, or longer if allowed on application.
Need help with an updated or revised return?
The windows are fixed, and the bars in sub-section (6)(c) and (d) can close the door. Our team can check whether an updated return is open to you and prepare it through our updated return (ITR-U) service.
Key takeaways
- Belated: nine months from the end of the tax year, or before assessment, whichever is earlier.
- Revised: twelve months, subject to section 428(b).
- Updated: forty-eight months from the end of the financial year succeeding the tax year, with listed bars.
- An updated return cannot reduce tax liability, cannot be a return of loss (with an exception), and cannot generate a refund or increase one.
- A defective return must be rectified within fifteen days; otherwise it is treated as not furnished.
Read next
- Section 263(1): who must file and the due dates
- Sections 264 and 265: tax return preparers and verification of return
- Section 267: updated return
- Chapter XV: return of income
Disclaimer: Based on the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026, as consulted on 2 October 2026. It explains the words of the Act only; the Income-tax Rules, 2026, notifications, circulars, later amendments and the way the tax authorities and courts apply these provisions should be checked. This article is general information, not legal advice; check the official text before acting.