Suram Chand Rahlan vs Commissioner of Income Tax

In respect of the assessment year 1982-83, at the instance of the assessee, the following question has been referred for the opinion of this court :

"Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the return filed by the assessed on March 12, 1985, was a valid return u/s 139(4) and the extended period of limitation in terms of section 153(1)(c) of the Income Tax Act, 1961 ?"

The Tribunal has found that the return filed by the assessed on March 12, 1985, being a return filed within the time prescribed u/s 139(4)(b)(iii) was a valid return as well as a valid revised return u/s 139(4) and, Therefore, the Income Tax Officer could complete the assessment within one year of March 12, 1985, which actually he did in terms of section 153(1)(c) of the Income Tax Act, 1961.

In a recent decision of the Supreme Court in Kumar Jagdish Chandra Sinha (dead) Through LRs. etc. Vs. Commissioner of Income Tax, West Bengal, , it has been held that no revised return can be filed under sub-section (5) of section 139 in a case where the return is filed u/s 139(4). Once this is so, the revised returns filed by the assessed for both the said assessment years were invalid in law and could not have been treated and acted upon as revised returns contemplated by sub-section (5) of section 139 and consequently section 153(1)(c) could not be attracted.

In this case, the first return was filed on September 30, 1982, that is, beyond the period prescribed u/s 139(1). This return was also not pursuant to notice u/s 139(2) and, Therefore, it could not be revised u/s 139(5). In view of the decision of the Supreme Court the question deserves to be answered in favor of the assessee. We may, however, note the contention of Mr. Gupta that the return filed on September 30, 1982, was non est as it was only a provisional return and a note had been appended to that return that it was filed provisionally in the absence of books. The submission of Mr. Gupta is that the return filed on September 30, 1982, being no return in the eyes of law, the return filed on March 12, 1985, was the first valid return u/s 139(4) and, Therefore, the assessment was completed within the limitation. It is difficult to accept the submission of Mr. Gupta since the Tribunal proceeded on the basis that the return filed on September 30, 1982, was a valid return though the Tribunal held that a revised return could be filed relying upon the decision of this court in Commissioner of Income Tax Vs. Dara Seshavataram, . That aspect in O.P. Malhotra Vs. Commissioner of Income Tax, Delhi, , has not been approved by the Supreme Court in Kumar Jagdish Chandra Sinha (dead) Through LRs. etc. Vs. Commissioner of Income Tax, West Bengal, .

For the aforesaid reasons we answer the question in the negative, in favor of the assessed and against the Revenue. No costs.