Return of income : Doctrine of relation back : S. 140 of Income-tax Act, 1961 : A.Y. 2004-05 : Return signed by company secretary : Defect curable : Subsequent valid return though filed late relates back to original return.

[CIT v. Haryana Sheet Glass Ltd., 318 ITR 173
(Del.)]

For the A.Y. 2004-05, the assessee-company had filed its
return of income on 1-11-2004 declaring a loss of Rs.10,38,98,405, which was
signed by the company secretary. Thereafter a revised return was filed on
5-10-2005 declaring loss of Rs.7,20,50,041, which was signed by the managing
director. The AO ignored the original return on the ground that the return was
not signed and verified in accordance with the provisions of S. 140 of the
Income-tax Act, 1961. He further found that the revised return was filed
belatedly and therefore he did not take the said return into consideration.
The Tribunal held that signing of the return by the secretary was a curable
irregularity. Therefore, when the managing director signed and filed the
return, it should relate back to the date when the original return was filed
under the signature of the company secretary. Since that original/revised
return was within time, it could have been taken into consideration.

On appeal by the Revenue, the Delhi High Court upheld the
decision of the Tribunal and held as under :

“(i) If the irregularity in the original return is
curable, then the doctrine of relation back would apply, but if there is a
fundamental defect in the original return, which cannot be cured, then such
a doctrine cannot be applied.

(ii) It is clear that the secretary has signed the
return, who is otherwise, as per the provisions of the Companies Act,
competent to sign. The provision of S. 140 of the Income-tax Act mandates
that the managing director or some other responsible officers can sign.
Because of this reason, we are of the opinion that in a case like this, the
irregularity was curable and the doctrine of relation back was rightly
applied.”