2018 (8) TMI 1767 - HC - Income Tax

Claim of carry forward of the loss as the return having been filed in Saral Form 2-D by the due date - change inform - Whether in view of Section 139 (1) read with Section 139 (3) of the Income Tax Act, the return in the prescribed From ITR (5) having been admittedly filed on 23.12.2008, i.e. beyond the due date, no claim can be legally allowed in respect of carry forward of the losses? - HELD THAT - The Tribunal has recorded a clear finding of fact that the assessee had filed its returns within the time limit, although the Form, which it had used is the old Form. The assessee has not sought to gain any unfair advantage in this matter by filing in the old Form and he did later on comply with the conditions of the new Form and it appears that the same return was filed. No reason to interfere in the order passed by the Tribunal.

Summary

Issues:
1. Interpretation of Income Tax Act regarding carry forward of losses.
2. Filing of returns in prescribed form within the due date.
3. Justification of Tribunal's decision on carry forward of losses.

Analysis:
1. The appeal before the Allahabad High Court involved the interpretation of the Income Tax Act, specifically regarding the carry forward of losses for the assessment year 2007-08. The department filed an appeal under Section 260-A against the Tribunal's order dated 08.11.2012. The questions of law raised included whether the Tribunal was justified in following the decision of the Allahabad High Court for allowing the claim of carry forward of losses amounting to ?7,59,46,064, despite the Supreme Court reversing the decisions of various High Courts on this matter.

2. The Court considered the issue of filing returns in the prescribed form within the due date as per Section 139(1) and Section 139(3) of the Income Tax Act. It was noted that the return filed by the assessee on 31.10.2007 was not in the prescribed form, and the return filed on 23.12.2008 was beyond the due date. The Tribunal, however, found that the assessee had filed its returns within the time limit, albeit using the old form initially. The Court observed that the assessee did not seek any unfair advantage by using the old form and later complied with the conditions of the new form, indicating that the same return was filed.

3. The Tribunal's clear finding of fact that the assessee filed its returns within the time limit, coupled with the absence of any unfair advantage sought by the assessee, led the Court to conclude that there was no reason to interfere with the Tribunal's order. The Court upheld the Tribunal's decision, stating that the appeal had no merit and dismissing it without imposing any costs. The judgment highlighted the importance of factual findings and compliance with procedural requirements in tax matters, ultimately affirming the Tribunal's decision on the carry forward of losses.