TMI Blog2008 (1) TMI 939X X X X Extracts X X X X X X X X Extracts X X X X ..... stipulated period, but filed a belated return on 19.11.1996. Even though the assessing officer issued proceedings under Section 143(1)(a) of the Act, he simultaneously issued notice under Section 148 of the Act proposing to make income escaping assessment under Section 147 of the Act. On receipt of notice the appellant requested the assessing officer to treat the belated return already filed as one filed against notice issued under Section 148 of the Act. The assessing officer thereafter completed the assessment under Section 147 read with Section 143(3), but assigned the status of firm to the appellant. The Commissioner of Income tax in suo motu revision proceedings initiated under Section 263 of the Act, declared that appellant is not en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has to be made under Section 144 of the Act. Counsel specifically referred to mandatory provision of Section 144 which states that the assessing officer on being satisfied by the failure of any of the three conditions referred to therein shall after giving the assessee an opportunity of being heard make an assessment to the best of his judgment. Referring to this provision, counsel contended that in the absence of best judgment assessment under Section 144(1), Section 184(5) of the Act has no application. In this case, since assessment is specifically made under Section 147 read with Section 143(3), appellant was entitled to assessment in the status of a firm is the contention raised by counsel for the appellant. On the other hand, senior ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h all the terms of a notice issued under sub-section (1) of section 142 or fails to comply with a direction issued under sub-section (2A) of that section, or (c) having made a return, fails to comply with all the terms of a notice issued under sub- section (2) of section 143, the Assessing Officer, after taking into account all relevant material which the Assessing Officer has gathered, shall, after giving the assessee an opportunity of being heard, make the assessment of the total income or loss to thebest of his judgment and determine the sum payable by the assessee on the basis of such assessment: Provided ........ Admittedly the return filed by the appellant was beyond the period provided under sub-section (1) or subsection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hnical compliance in filing returns or complying with notices. Probably it is to get over this irrational and discriminatory consequence that Section 184(5) and Section 185 are amended specifying the disability of firms for failures referred to in Section 144 of the Act. So far as unreported judgment of the Karnataka High Court is concerned, we do not find any application to the facts of this case because the case decided by the Karnataka High Court is the one where the assessee was disabled from filing the return in time on account of seizure and detention of books of accounts by the Department. The Karnataka High Court held that failure to file return can arise only when it was possible for the assessee to file return in time. Therefore t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the word or is used in clauses (a) to (c) of Section 144, a best judgment assessment is called for only when there is cumulative failure of all the conditions including failure to furnish details of income and prove the same through his accounts and documents. Even though there is failure on the part of the appellant to file return in time, which is a failure referred to in Section 144, still best judgment assessment was not made by the assessing officer , in as much as assessment completed is one under Section 147 read with Section 143(3) of the Act. However, since there is failure on the part of the appellant in filing the return referred to clause (a) of Section 144, Section 184(5) is attracted, and appellant is rightly declined the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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