TMI Blog1983 (4) TMI 77X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 Date on which return was due 31-10-1977 Return filed under section 139(2) of the Income-tax Act, 1961 ('the Act') 14-6-1978 A revised return filed 22-3-1980 Draft order under section 144B of the Act sent to the assessee by the ITO 31-3-1980 Last date for completion of the assessment but for section 144B proceedings 5-4-1980 Objections filed 7-4-1980 Objections forwarded to the IAC 11-7-1980 Further objections filed and forwarded to the IAC 7-8-1980 Revised return filed 4. The return on 31-10-1977 had declared a net loss of Rs. 18,80,620. This was revised as net loss of Rs. 20,51,430 by the revised return filed on 14-6-1978. The enhanced loss was on account of a claim for weighted deduction of Rs. 1,70,804 under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Aggrieved by this order, the department has come up in appeal. 7. The arguments of the learned departmental representative were to the following effect : only one revised return could be filed under section 139(5). No, revised return could be accepted after the draft assessment order has been forwarded by the ITO to the IAC under section 144B(2). It is also not permissible for the ITO to forward more than one draft order. The proceedings before the IAC are quite different from the assessment proceedings. The assessment proceedings cannot be said to be pending after the forwarding of the draft order to the IAC. The extended period available under section 144B read with section 153 is available only for completing the assessment and it cann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e IAC is to be acted upon, then the ITO will have to forward another draft order to the IAC on the basis of the revised return and that it has been held in Sudhir Sareen v. ITO [1981] 128 ITR 445 (Delhi) that the ITO cannot forward more than one draft order under section 144B. In this case, the question whether the earlier draft order could be recalled and whether a fresh draft order could be forwarded when the assessee has filed a revised return, was not considered by the High Court. As rightly pointed out by the learned counsel for the assessee, this ruling is only an authority for the position that a second draft order cannot be forwarded when nothing intervenes. The next contention of the learned departmental representative was that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e revised return has been filed during the extended period of limitation, consequent on the initiation of proceedings under section 144B and that the ITO is bound to take notice only of a revised return filed during the normal period of limitation. There is nothing in the Act which restricts the time for filing the revised return up to the commencement of the proceedings under section 144B. This is sufficient to reject the contention of the department. It is true that it is settled law that a return or revised return which is filed beyond the period of limitation prescribed for making the assessment is non est and cannot be acted upon. But the test is whether the return is filed at a time when an assessment could have been lawfully made. In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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