TMI Blog1982 (5) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... er, he filed a revised return on March 23, 1974. The assessment was completed on January 23, 1975, and as against the disclosed income of Rs. 9,525 in the original return and Rs. 11,225 in the revised return, the total income was computed at Rs. 30,130. Aggrieved, the assessee filed an appeal and apart from challenging the assessment order on merits raised a legal plea. That plea was that the assessment made by the ITO on January 29, 1975, was barred by limitation. The assessment for this year should have been completed by March 31, 1974. According to the assessee since the return has been filed under s. 139(4) it could not be revised under sub-s. (5) of s. 139 and that return did not extend the period for making the assessment. Therefore, the assessment was beyond time. The AAC did not accept this contention on the view that under s. 139(5) any person having furnished a return can file a revised return at any time before the assessment is made in case he discovers any omission or any wrong statement, therein. The time for making the assessment, therefore, stood extended by one year and so the assessment framed by the ITO on January 2, 1975, was well within time. In the quant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch is final on the point, renders him liable to income-tax requiring him to furnish within thirty days such a return. Such notice may be issued at any time in the course of the assessment year. If a notice is not issued in the course of the assessment year and the assessee does not voluntarily submit a return, and the income, is not assessed in the normal course under s. 142, the ITO must proceed under ss. 147 and 148 if he wants to assess such income in the subsequent years. Under sub-s. (3) if any person who has not been served with a notice, under sub-s. (2), has sustained a loss in any previous year under the head "Profits and gains of business or profession " or under the head " Capital' gains ", and claims that the loss or any part thereof should be carried forward under ss. 72(1), 73(2), 74(l) or 74A(3), he may furnish, within the time allowed under sub-s. (1) or within such further time, which on an application made in the prescribed manner, the ITO may, in his discretion, allow, a return of loss in the prescribed form and verified in the prescribed manner. Then comes sub-s. (4) which is in the following terms: "(4)(a) Any person who has not furnished a return within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the return filed under sub-s. (4). We may also refer to s. 153 which provides for a time-limit for the completion of the assessment and reassessment. Sub-section (1) of this section which is relevant for our purposes is in the following terms: "153. (1) No order of assessment shall be made under section 143 or section 144 at any time after (a) the expiry of (i) four years from the end of the assessment year in which the income was first assessable, where such assessment year is an assessment year commencing on or before the 1st day of April, 1967; (ii) three years from the end of the assessment year in which the income was first assessable, where such assessment year is the assessment year commencing on the 1st day of April, 1968 (iii) two years from the end of the assessment year in which the income was first assessable, where such assessment year is an assessment year commencing on or after the first day of April, 1969 ; or (b) the expiry, of eight years from the end of the assessment year in which the income was first assessable, in a case falling within clause (c) of sub-section (1) of section 271 ; or (c) the expiry of one year from the date of the fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-s. (4) with a return filed under sub-s. (1). Now, we can consider this question from yet another aspect and it is that different time-limits for completion of assessment have been provided in respect of cases where a return has been filed under sub-s. (4) or a revised return has been filed under sub-s. (5). Sub-section (5) does not provide for any separate category of return. It only gives a right to an as to revise the return filed under sub-s. (1) or sub-s. (2). When a revised return is filed the original return stands supplanted or withdrawn. In other words, if the original return is under sub-s. (1) and a revised return is filed, then the revised return would be a return under sub-s. (1) and so will be the position if the original return was under sub-s. (2) In our opinion, therefore, the return provided for under sub-s. (4) stands in a category different from those provided in sub-s. (1)or sub-s. (2) and such a return cannot be revised under sub-s. (5) because that sub-section does not say so. That being the position, where a return is filed under sub-s. (4), the limitation for completing the assessment is two years from the end of the assessment year in which the income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... class." On this view, since sub-s. (4) of s. 22 makes no reference to the returns filed under sub-s. (3), the notice issued under s. 22(4) was hold to be invalid. In the Act of 1922, s. 28 refers to sub-ss. (1) and (2) of s. 22, but makes no reference to sub-s. (3) of the said section. The Bench repelled the argument of the revenue that s. 28 suggests that a return filed under sub-s. (3) of s. 22 is covered by s. 28. It was observed that the returns to be furnished under sub-ss. (1) and (2) are obligatory. On the other hand, the return furnished under sub-s. (3) is voluntary, and that being so, " the Legislature rightly 'decided that there should be penalty for non-compliance with the requirements of sub-ss. (1) and s. (2) but there is no need for prescribing a penalty for failure to furnish a voluntary Statement under sub-s. (3) of s. 22." Our attention was invited to a Full Bench decision of our court rendered in Metal India Products v. CIT [1978] 113 ITR 830. The question under consideration was whether penalty under s. 271(1)(a) of the Act could be levied in respect of a return filed under s. 139(4). The answer was given in the negative. It was ruled that s. 139 lays down t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co. P. Lid. [1970] 77 ITR 518 (SC) and a decision of this court in Niranjan Lal Raw Chandra v. CIT [1982] 134 ITR 352. In Kula Valley Transport Co., the assessee company had filed voluntary returns showing losses from business for the., assessment years 1953-54 and 1954-55 in January, 1956. The ITO took the view that as the returns had not been filed within the time prescribed under sub-s. (1) of s. 22 of the 1922 Act, they had not been validly filed under s. 22(2A) of the Act and, therefore, the assessee could not claim that the losses should be determined and carried forward. The High Court of Punjab took a contrary view and held that even if the return was filed beyond the period prescribed by s. 22(1) and disclosed loss, the ITO was bound to determine the loss so that it could be carried forward to the following year. That decision was affirmed by the Supreme Court. It was ruled (p. 527) : "Section 22(2A) is merely a procedural provision and it also provides that once a return has been furnished in accordance therewith, all the provisions of the Act become applicable as if it were a return under subsection (1). That would attract section 22(3) and, therefore, a voluntary ret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d return filed under sub-s. (5) would in law be a return under sub-s. (1) also. The result of filing a second revised return would be to extend the period of limitation for purposes of s. 153(1)(c). In taking this view the Bench was mindful of the prevalent practice of filing more than one revised return which the department has been accepting consistently. According to the learned standing counsel, if the assessee's contention is accepted, then this decision would become wrong because sub, s. (5) does not say that a revised return filed under this section can be further revised. The contention is misconceived because, as noted above, sub-s. (5) provides for furnishing a revised return in a case where the return has been furnished under sub-s. (1) or sub-s. (2). When such return-is revised, the revised return takes the place of the original return filed under either of these two sub-sections. The revised return itself becomes a return under sub-s. (1) or sub-s. (2), as the case may be. In Ca" there is any omission or wrong statement in such original return, it can surely be corrected by a subsequent revised return if filed before the assessment is made. This decision does not sup ..... X X X X Extracts X X X X X X X X Extracts X X X X
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