27. The assessee is a retired employee, and he has income from salary pension. Along with pension and house property and from other sources. His taxable income for the financial year 2019 -202 was Rs 2,90,000. In the month of April 2020, he became a senior citizen. Since he attained 60 years of age his income is much below the exempted income of Rs.2,50,000 and Rs 3,00,000. He has filed nil return. The assessing officer assessed the income and levied tax and interest. You as the consultant advise the assessee.

The assessee is a retired employee, receiving pension, income from house property, and other sources.
For the financial year (FY) 2019–20 (i.e., assessment year 2020–21), the assessee’s total taxable income was ₹2,90,000.
In April 2020, the assessee attained the age of 60, and thus became a senior citizen as per the Income Tax Act.
Based on his understanding of the exemption limit for senior citizens (₹3,00,000), he filed a nil return, presuming no tax liability.
However, the Assessing Officer (AO) assessed the income and levied tax and interest, treating the basic exemption limit as ₹2,50,000 applicable to individuals below 60 years.
The assessee seeks professional advice on the correctness of the AO’s action and his true tax liability.

Whether the assessee qualifies as a senior citizen for FY 2019–20, given that he turned 60 in April 2020?
What is the correct basic exemption limit applicable to the assessee for FY 2019–20?
Is the AO justified in assessing tax and interest, or is the assessee right in filing a nil return?
Can the assessee contest the AO’s order and seek rectification or appeal?

Under the Finance Act, a senior citizen is defined as:

“An individual resident in India who is of the age of 60 years or more at any time during the relevant previous year.”

In this case, the relevant previous year is FY 2019–20 (April 1, 2019 – March 31, 2020).

Since the assessee attained the age of 60 in April 2020, i.e., after FY 2019–20 ended, he was not a senior citizen for that year.

For FY 2019–20:
- General Individuals (below 60 years): ₹2,50,000
- Senior Citizens (60 to <80 years): ₹3,00,000
- Super Senior Citizens (80+ years): ₹5,00,000

As the assessee turned 60 after March 31, 2020, the applicable limit is ₹2,50,000 for FY 2019–20.

An individual must file a return if gross total income before deductions exceeds the basic exemption limit.
Here, the assessee’s income was ₹2,90,000, exceeding the ₹2,50,000 threshold for non-senior individuals.

Therefore, the assessee was required to file a return and pay applicable tax.

Section 234B & 234C: Interest levied for non-payment or shortfall in advance tax.
Section 234A: Interest for delayed filing of return (if due tax not paid).

Based on the facts and applicable legal provisions, the assessing officer’s action is legally correct.

The assessee became a senior citizen only in April 2020, which pertains to FY 2020–21.
For FY 2019–20, the assessee was under 60, so the basic exemption limit was ₹2,50,000.
Since his income was ₹2,90,000, he was liable to pay tax on ₹40,000 (after rebate under Section 87A, if applicable), and was not eligible to file a nil return.
Tax and interest levied by AO is within legal limits, especially if the tax was not paid in advance.

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