TMI Blog1986 (8) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... n 139(1) of the Act. She filed an application in Form No. 6 on 28-6-1975 for extension of time for furnishing the return up to 30-9-1975. The ITO, it appears, did not pass any order on the said application. He, however, issued a notice under section 139(2) which was served upon the assessee on 29-11-1975. Even then, the assessee did not file any return of income. Subsequent notice under section 142(1) of the Act served upon the assessee also went unresponsed. The ITO, therefore, completed the assessment under section 144 of the Act on total income of Rs. 60,000 on 4-5-1977. Application of the assessee under section 146 of the Act for reopening of the assessment was rejected by the ITO on 30-8-1977. Appeal from the said rejection order of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the explanation. He imposed the penalty of Rs. 83,500. 4. The assessee appealed before the Commissioner (Appeals) against the said penalty order. It was contended before the Commissioner (Appeals) by the assessee that the ITO while computing the period of delay did not take into account the application filed for extension of time up to 30-9-1975 and further that the assessee could not file return of income after making of the assessment under section 144 on 4-5-1977 till it was set aside by the Commissioner on 31-3-1979. It was also contended that the return could not be filed for non-receipt of accounts from the partnership firm Bharat Mineral Sales Corpn. which firm itself filed return of its income for the said assessment year on 2-9-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after making the assessment or reassessment. Thus, an assessee can avail of opportunity to file the return till before making of the assessment, of course, within prescribed time limit. It, therefore, follows that in case of non-filing of the return, the default continued till the date of making the assessment. Thus, when no return has been furnished at all the period of default should be reckoned till the date of assessment. The ITO should have calculated the period of delay from 30-9-1975 (till which date extension to file the return was sought) to 4-5-1977 on which date assessment under section 144 was framed. 7. The ITO further fell into another error, viz., that he though directed initiation of penalty proceedings under section 271( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nitiating penalty proceedings on the basis of the later assessment order the ITO had no jurisdiction to take into account the delay in filing the return in earlier proceedings. Strictly speaking, the question of delay in later proceedings does not arise since the return was filed beyond the time prescribed in law. The ITO did not proceed with the penalty proceedings initiated on the basis of the earlier assessment order and even otherwise they became barred by limitation by 31-3-1980. 8. Viewed from this angle it is not necessary to see if there was sufficient cause for the delay in filing the return. 9. The order of the Commissioner (Appeals) cancelling the penalty is, therefore, upheld though for the reasons other than those recorded ..... X X X X Extracts X X X X X X X X Extracts X X X X
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