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2019 (5) TMI 558 - HC - Income TaxPower to file Revised returns of income pursuant to the scheme of arrangement and amalgamation approved by the National Company Law Tribunal - applicability of limitation to file revised return - effect of circular issued u/s 119(2)(b) of the Income Tax Act namely Circular No. 9 of 2015 in light of scheme of amalgamation approved by the NCLT under Section 391 of the Companies Act ? - HELD THAT:- Section 139(5) is not applicable in cases where revised returns of income have been filed pursuant to the scheme of arrangement and amalgamation approved by the National Company Law Tribunal. The circular No. 9 of 2015 issued by the Central Board of Taxes under Section 119(2)(b) of the Income Tax Act, 1961, is not applicable in cases where revised returns of income have been filed pursuant to the scheme of arrangement and amalgamation approved by the Court. There is also no statutory bar under the Income Tax Act, to disable the assessee from filing revised returns of income pursuant to the scheme of arrangement and amalgamation approved by the Court under Section 391 of the Companies Act. The rules of procedure are handmaid of justice. It should not be an obstruction in the aid of justice. As rightly observed by Krishna Iyer, J. , in the case of Sushil Kumar [1975 (3) TMI 137 - SUPREME COURT] , the procedure should be the handmaid, not the mistress of legal justice which vests with residuary power in the Judges to act ex debito justitiae, where the tragic sequel otherwise would be wholly inequitable. It is settled law that while dealing with the taxing provision, when two interpretations are possible, the Court would interpret the provisions in favour of the tax payer and against the revenue. In cases of doubt or dispute, the construction should be made in favour of the tax payer and against the revenue. In the case on hand, there is no express statutory bar in cases where revised returns of income have been filed belatedly pursuant to the scheme of arrangement and amalgamation approved by the Court. When there is no such express bar under the Income Tax Act, 1961 or its Rules, the respondent cannot override the approved scheme of arrangement and amalgamation which has a statutory force by rejecting the revised returns of income filed by the respective petitioners as invalid. Just because the website of the Income Tax Department does not entertain revised returns of income after the prescribed period, as stipulated u/s 139(5) the respective petitioners cannot be rendered remediless. Procedures are handmaid of justice. They have to be interpreted to carry forward the objects of the enactment. If not for the website of the Income Tax Department's refusal to accept revised returns of income beyond the prescribed period as stipulated u/s 139(5) the respective petitioners in the normal circumstances would have been able to file the revised returns of income, pursuant to the approval of the scheme of arrangement and amalgamation by the National Company Law Tribunal. Procedures aid the effective implementation of the Act of the legislature. Rule 12(3) of the Income Tax Rules stipulates that returns of income can be filed only electronically. But the case on hand is an exceptional case where it has necessitated the respective petitioners to file the revised returns of income manually since the website of the income tax department refuses to accept the returns of income which has been filed beyond the prescribed period under Section 139(5) of the Income Tax Act, 1961. As already observed, Section 139(5) of the Income Tax Act, is not applicable for the facts of the instant case. Therefore, this Court is of the considered view that the respondent ought not to have rejected the filing of the revised return of income by the respective petitioners on the ground that the same has been filed manually instead of electronically. Therefore, Rule 12(3) of the Income Tax Rules, 1962 will not bar the respective petitioners to file the revised returns of income manually as the revised returns of income have been filed only pursuant to the scheme of arrangement and amalgamation approved by the National Company Law Tribunal. For the foregoing reasons, this Court answers the points for consideration framed at the outset in these Writ Petitions in the following manner: a) The scheme of arrangement and amalgamation approved by the National Company Law Tribunal under Section 391 of the Companies Act gives statutory force to enable the respective petitioners to file the revised returns of income beyond the prescribed period and Section 139(5) of the Income Tax Act, 1961 is not applicable for cases where revised returns of income have been filed pursuant to approval of scheme of arrangement and amalgamation by the Competent Court. b) The Circular issued under Section 119(2)(b) of the income tax act, namely, Circular No. 9 of 2015 is not applicable for filing of revised returns of income pursuant to a scheme of arrangement and amalgamation approved by the Court under Section 391 of the Companies Act. c) Rule 12(3) of the Income Tax Rules which requires filing of revised returns of income electronically is not applicable to cases where revised return of income has been filed by the assessee pursuant to scheme of arrangement and amalgamation approved by the Court. The impugned orders in all the writ petitions are hereby quashed and the respondent is directed to receive the revised returns of income filed by the respective petitioners pursuant to the scheme of arrangement and amalgamation approved by the National Company Law Tribunal, Chennai and complete the assessment for the assessment years 2015-2016 and 2016-2017 in accordance with law within a period of twelve [12] weeks from the date of receipt of the revised returns of income from the respective petitioners.
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