TMI Blog1996 (4) TMI 5X X X X Extracts X X X X X X X X Extracts X X X X ..... ect in law in holding that the return of income furnished by the assessee by virtue of the provisions contained in sub-section (4) of section 139 of the Income-tax Act, 1961, beyond the time allowed under sub-section (1) or sub-section (2) of the said section, could not be construed as a return furnished under either of the latter sub-sections and in that view holding that the assessee was not entitled to file a revised return under sub-section (5) of section 139 of the Income-tax Act, 1961 ? 2. Whether, on the facts and in the circumstances of the case, the assessments made by the Income-tax Officer for the assessment years 1964-65 and 1965-66 were within the time-limit prescribed in section 153(1)(b) of the Income-tax Act, 1961 ? 3. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that the cases for the assessment years 1964-65 and 1965-66 were such as falling within clause (c) of sub-section (1) of section 271?" While question No. 1 was referred at the instance of the Revenue, questions Nos. 2 and 3 were referred at the instance of the assessee. The two assessment years concerned herein are 1964-65 and 1965-66. For th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e also disputed the correctness of the various additions made by the Income-tax Officer. The Appellate Assistant Commissioner allowed the appeals on the ground that the assessment orders having been made beyond the period of four years prescribed by section 153(1)(a)(i) (as in force at the relevant time), they are bad in law. He held at inasmuch as the returns in both the assessment years were filed under section 139(4), no revised returns could have been filed by the assessee. He held that sub-section (5) of section 139 permits a revised return to be filed only where, the return is filed under sub-section (1) or sub-section (2) of section 139 but not where the return is filed under sub-section (4) of section 139. In this view of the matter, the Appellate Assistant Commissioner held that the Income-tax Officer cannot claim the benefit of the extended period provided by clause (c) of sub-section (1) of section 153. The Revenue challenged the decision of the Appellate Assistant Commissioner before the Tribunal. The Tribunal agreed with the Appellate Assistant Commissioner that no revised return can be filed by an assessee who has filed the return under section 139(4) and that, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of which he is assessable under this Act, includes any income from business or profession, before the expiry of six months from the end of the previous year or where there is more than one previous year, from the end of the previous year which expired last before the commencement of the assessment year, or before the 30th day of June of the assessment year, whichever is later ; (b) in the case of every other person, before the 30th day of June of the assessment year : (Proviso omitted as unnecessary). (2) In the case of any person who, in the Income-tax Officer's opinion, is assessable under this Act, whether on his own total income or on the total income of any other person during the previous year, the Income-tax Officer may, before the end of the relevant assessment year, serve a notice upon him requiring him to furnish, within thirty days from the date of service of the notice, a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed : (Proviso omitted as unnecessary). (4)(a) Any person who has not furnished a return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whichever is latest. " Section 271(1)(c) ran thus : " 271. Failure to furnish returns, comply with notices, concealment of income, etc. -- (1) If the Income-tax Officer or the Appellate Assistant Commissioner in the course of any proceedings under this Act, is satisfied that any person,--- (clauses (a) and (b) omitted as unnecessary) ; (c) has concealed the particulars of his income or (The word ' deliberately ' omitted by Finance Act, 1964 [(w.e.f. 1-4-1964)] furnished inaccurate particulars of such income, he may direct that such person shall pay by way of penalty, . . . . (iii) in the cases referred to in clause (c), in addition to any tax payable by him, a sum which shall not be less than, but which shall not exceed twice, the amount of the income in respect of which the particulars have been concealed or inaccurate particulars have been furnished." The first question is whether a person who files a return under section 139(4) is entitled to file a revised return before the assessment is made. We think not. The furnishing of a revised return is provided by sub-section (5) of section 139. According to this sub-section " any person having furnished a return unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39(4). Once this is so the revised returns filed by the assessee for both the said assessment years were not valid in law and could not have been treated and acted upon as revised returns contemplated by sub-section (5) of section 139--which means that section 153(1)(c) was not attracted in this case. Indeed, this is the view taken by all the High Courts as conceded by Mr. Ashok Sen. (see O. P. Malhotra v. CIT [1981] 129 ITR 379 (Delhi) ; Dr. S. B. Bhargava v. CIT [19821 136 ITR 559 (All) ; Vimalchand v. CIT [19851 155 ITR 593 (Raj) and Eapen Joseph v. CIT [1987] 168 ITR 26 (Ker)). Only the Calcutta High Court has taken the contrary view with which we are unable to agree. The understanding of clause (b) of sub-section (1) of section 153, however, appears to be a difficult one, because of the ambiguous language employed therein. It says that " in a case falling within clause (e) of sub-section (1) of section 271 ", the period for making an order of assessment is eight years. Now what do the words " in a case falling within clause (c) of sub-section (1) of section 271" mean ? Different High Courts have spoken in different voices. Broadly speaking there are two streams of thought. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 271(1)(c) and if it is found by the higher authorities that it was not a case falling within section 271(1)(c), it is obvious, the assessment order will be set aside, besides quashing the penalty proceedings. It is, therefore, not necessary,--it is argued--that within the period of four years (or the other applicable period of limitation as the case may be), the Income-tax Officer should issue a notice or pass an order or make a record that it is a case falling within section 271(1)(c) and that the validity of the assessment order should be judged with reference to the date on which the assessment order is made. We find that both the streams of thought aforesaid are equally attractive. Each has an appeal of its own. We are, however, relieved of making a choice in the matter because of the decision of this court in CIT v. Suraj Pal Singh [1991] 188 ITR 297. It was an appeal against the decision of the Allahabad High Court in CIT v. Surajpal Singh [1977] 108 ITR 746. The Allahabad High Court discussed this problem at length (at pages 72 and 753), but ultimately did not express any final opinion for the reason that it was not necessary to do so in view of the facts of and find ..... 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