Requirement of filing declaration under section 184(7), as amended by Taxation Laws (Amendment) Act, 1970, within time allowed under section 139(1)/(2) for furnishing return of income - ITOs to be liberal in condoning delay for assessment year 1970-71 and earlier years where, even after 1-4-1971, de - Income Tax - 105/1973

Circular No. 105 Dated 23/2/1973 Requirement of filing declaration under section 184(7), as amended by Taxation Laws (Amendment) Act, 1970, within time allowed under section 139(1)/(2) for furnishing return of income - ITOs to be liberal in condoning delay for assessment year 1970-71 and earlier years where, even after 1-4-1971, declaration had been filed along with return 1. Prior to the amendment of section 184(7) by the Taxation Laws (Amendment) Act, 1970, a firm, which had been granted registration for any assessment year, could get the benefit of the registration for a subsequent year provided, inter alia , that the firm furnished along with the return of income a declaration in Form No. 12. After the amendment of section 184(7), which is effective from April 1, 1971, the firm has to furnish Form No. 12 within the time allowed under section 139(1)/(2) for furnishing the return of income. 2. The Board, in the Explanatory Notes on provisions of the Taxation Laws (Amendment) Act, 1970, have observed that the amendment will apply not only in relation to the assessments for the year 1971-72 and subsequent years but also for the assessment year 1970-71 or any earlier year where the question of registration or continuation thereof is considered on or after April 1, 1971. If, therefore, an assessee-firm files returns of income for 1970-71 or earlier years within the time limit under section 139(4)( a ) and also files Form No. 12 for continuation of registration after April 1, 1971, the firm would not be eligible for the benefits or registration because the form would not have been filed within the time allowed under section 139(1)/(2). A strict interpretation of this nature is likely to cause genuine hardship to such firms. Section 184(7), proviso ( ii ), however, empowers the Income-tax Officers to allow to furnish the declaration at any time before the assessment where he is satisfied that the firm was prevented by sufficient cause from furnishing the declaration in time. In view of the hardship that is likely to be caused, the Board desires that the Income-tax Officers should be liberal in condoning the delay for 1970-71 and the earlier assessment years, where, even after April, 1971, the declaration had been filed along with the return of income and condone the delay. Circular : No. 105 [ F. No. 225/86/71-IT(A-II) ], dated 23-2-1973 .