Assessment order u/s.143(1)/(3)/144 not to allow the loss if return is not filled u/s 139(3). - Income Tax - 210/CBDT

INSTRUCTION NO. 210/CBDT Dated: August 28, 1970 Section(s) Referred: 139(3) Statute: Income - Tax Act, 1961 Please refer to Board's Instruction No.171 (f.No.13/5/69-ITAII) dated the 14th May, 1970 on the above subject. The Board had observed therein that if a return of loss was filed beyond the time limit prescribed u/s.139(3) but within the period mentioned in Section 139(4), the ITO had to pass an assessment order u/s.143(1)/(3)/144 but disallow the claim for carry forward of the loss because the return had not been filed within the time limit prescribed u/s.139(3). 2. However the Civil Appeals No.859 860 of 1968 in the case of CIT Vs. Kulu Valley Transport Co.Pvt.Ltd (reported at 77 ITR Short notes page 9), the Supreme Court have observed that a return submitted at any time before the assessment is made is a valid return. A return whether it is a return of income, profits or gain, or loss must be considered as having been made within the time specified in Section 22(3) of India I.T.Act,1922. If section 22(3) is complied with, section 22(1) also must be held to have been complied with and hence the requirement of section 22(2A) would be satisfied. Therefore even if a 'loss' return is not filed within the time limit prescribed u/s.22(2A), the assessee does not forfeit the right to carry forward the loss. 3. Even though the decision was given in the above case on the interpretation of provisions of section 22(2A) of Indian I.T.Act,1922, the same would be applicable MUTATIS MUTANDIS to section 139(3) of I.T.Act,1961 since the provisions in the Acts of 1922 and 1961 in this respect are in PARI MATERIA. 4. The Board's Instruction No.171 dated the 14th May, 1970, referred to in para 1 above is accordingly superseded. The position detailed in paras 2 and 3 above may be kept in mind by the assessing officers in respect of future assessments. After scrutiny of cases involving this point by CsIT/Addl.CsIT, the assessee's pending appeals/references/revision petitions and the Department's pending appeals/references on the issue may be conceded/withdrawan as the case may be, according to law.