9911796707
TMI Blog1993 (2) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... ,743. The ITO worked out a total loss for deficiency of Rs. 1,59,853 including depreciation of Rs. 1,05,127. Thus, the business loss excluding depreciation was computed at Rs. 54,726. He ordered that since the return was filed late business loss of Rs. 54,726 would not be allowed to be carried forward. He further noted that the assessee had not provided any evidence to show that the extension of time for filing the return was allowed by the ITO. The CIT (A) noted in para 3 of page 3 of his order that the return was due on 30th June, 1985 but it was filed really on 29-11-1985. He noted further that the assessee had filed Form No. 6 on 28-6-1985 seeking time up to 30th September, 1985 and then another Form No. 6 was filed on 11-11-1985. He fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11-1985 there would be no question of any presumption in favour of the assessee. He went to the extent of saying that the second application in Form No. 6 was invalid application as it was filed after the expiry of time sought by the first application. 5. In reply, the learned representative for the assessee submitted that the CIT (A) has rightly applied the ratio of the Hon'ble Gujarat High Court decision in the case of Gordhanbhai Jethabhai. He submitted that as no intimations of rejection of applications were received the assessee was entitled to presume that the extensions sought had been granted. He submitted that after filing applications for seeking extensions the assessee was required to do nothing else while the Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for extension of time to furnish returns, render his decision on the application made to him, and communicate it to the assessee concerned. He has no doubt discretion whether or not to extend the date, but such discretion has to be exercised judicially and not arbitrarily. He, however, cannot refuse to use discretion one way or the other and ignore the application for extension made to him in the prescribed form. If the application is not made properly or it suffers from some defect, it may be open to the ITO to reject the application on that ground, but he cannot simply ignore the application as not maintainable. " Obviously, this prong talks of the ITO's duty on receipt of application for seeking extension of time and this particular as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, show that the question of such a belief or presumption on the part of the assessee would not arise in respect of the period, if any, not covered by applications in Form No. 6. In this particular case such uncovered period is of about 40 days, i.e., from 1-10-1985 to 10-11-1985 and during those 40 days assessee could not have presumed that time would have been allowed. This is so because starting from 1-10-1985 up to 10-11-1985 assessee will first have to presume that at some future date he would make an application for seeking extension of time and on the top of it he will have to further presume that the ITO would not act on his application. Such an inference cannot be drawn. Of course, if on a belatedly filed application in Form No. 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 80 even when the benefit of the Hon'ble Gujarat High Court decision in Gordhanbhai Jethabhai's case is available, the benefit of carry forward would not be available. 10. Thus, it is of paramount importance that ITO takes a decision on assessee's application filed on 11-11-1985 seeking extension up to 30-11-1985. Thereafter, the ITO would decide the fate of assessee's right of carry forward of business loss. In effect, therefore, there is no escape from our restoring the matter to the file of the Assessing Officer with a direction that first order should be passed on the assessee's application in Form No.6 filed on 11-11-1985 for seeking extension of time up to 30-11-1985. If necessary, he may obtain the xerox copy of the application an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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