Indus Motor Co. Ltd. v. ACIT
A.Y. : 1998-99. Dated : 24-1-2007
Whether if application filed by assessee for additional
time for removing the defect in the return u/s.139(9), is not disposed of or
no action is taken and if Assessing Officer remains silent then time asked for
by assessee would be treated as granted by Assessing Officer — Held, Yes.
The assessee-company filed its return of loss on
30-11-1998, but it could not attach the statutory audit report with it.
Consequently, the Assessing Officer issued letter to the assessee asking it to
rectify said defect. On receipt of the letter, the assessee filed application
requesting for extension of time till 5-3-1999 for filing the audit report as
per the deficiency letter. However, there was no communication from the
Assessing Officer in response to the said application of the assessee.
Subsequently, the assessee filed another return of loss on 5-3-1999 revising
the loss. The Assessing Officer completed the assessment u/s.143(3) but the
said loss was refused to be carried forward and set-off in future on the
ground that the assessee had filed its revised return of loss after the due
date. On appeal, the Commissioner (Appeals) upheld the impugned order.
On second appeal, the ITAT held that :
1. As per the provisions of S. 80, if the return of
income is not filed as provided u/s.139(3) the loss determined shall not be
carried forward and allowed to be set-off under the relevant provisions.
2. S. 139(9) provides that if the return furnished by the
assessee is defective then the AO may intimate the defect to him and give
him an opportunity to rectify the defect within a period of 15 days or
within such further period on an application made by the assessee as the
Assessing Officer in his discretion may allow.
3. In the instant case, the assessee filed an application
requesting for further period to rectify the defect. It had requested the AO
for time up to 5-3-1999 to file the return. It was the duty of the AO to
dispose of the application filed by the assessee, either granting the
additional time or refusing the same. But the AO did not act on the said
application.
4. If the application filed by the assessee for
additional time is not disposed of or no action is taken and if the
Assessing Officer remains silent, then time asked for by the assessee would
be treated as granted by the Assessing Officer.
5. Another aspect to be considered was that if it was not
a valid return, then how the assessment was framed u/s.143(3). The returns
filed by assessee on 30-11-1998 as well as on 5-3-1999 were valid returns
and there was no bar to carry forward determined loss as per S. 80.
