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TMI Blog1982 (6) TMI 186X X X X Extracts X X X X X X X X Extracts X X X X ..... an., 1976 is not a return under s. 139 (1) because it was filed after the period of time granted by the ITO. Since no notice under s. 139(2) was served on the assessee, the return can be only a return under s. 139(4). According to him, the statute does not allow a revised return to be filed in respect of a return filed under s. 139(4). So the return filed on 10th Oct., 1977 is non est. The time limit for completing the assessment cannot be calculated on the basis of this return. Therefore, the time limit is 31st March, 1978. Since the assessment was completed only on 4th April, 1979, it is barred by limitation. Shri Patil, appearing for the company has mainly relied on a decision of the Delhi High Court in the case of O.P. Malhotra vs. CIT (1981) 129 ITR 379 (Del). The Department on the other hand had relied on the decision of the Calcutta High Court on the very same point in the case of Zulekha Begum (Khatoon), Mrs. (1981) 129 ITR 560 (Cal). Both parties have relied on certain decisions of the Tribunal in support of their respective contentions. We may briefly mention that the assessee company had placed reliance on the decision of the Bangalore Bench in ITA Nos. 1252 and 123 of 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision, however, governs a case where a return purported to be under s. 139(5) has been filed beyond the normal period of limitation. This fact must be kept in mind in order to appreciate the findings of Delhi High Court. It will be clear from the following extracts from the judgment: "Sub-s (5) was intended to provide a locus penitentise to assessees, who had filed their returns of income in compliance with the requirements of subs-ss. (1),(2) and (3) and within the time allowed thereunder to revise the same when they discovered an omission or wrong statement therein. But where a person has not filed such a return and is availing himself of the provisions of sub-s (4) which enable him to file a return after a delay which might extend up to four years, it could well be that the legislature thought that no such opportunity of revision was needed to be provided for. In the context, it should be remembered that such an assessee can within the period of four years provided for in s. 139(4) (which has been reduced subsequently to two years conformably to amendments in s. 153 reducing the time limit for completion of assessments) file as many returns as he wants." The portion supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see that a return filed under s. 139(4) is a return within the time limit of 11s. 139(1). The Court referred to the provisions of s. 139 and pointed out that but for s. 139(4) the assessee would not have been able to file a return of income after the expiration of the time allowed under ss. 139(1) and 139 (2). That would have caused great hardship to the assessee for it would have enabled the ITO to make best judgment assessment which might be highly prejudicial to the assessee. The legislature, therefore, gave one more opportunity to the assessee to file a return of income despite the default committed by him. But, if the default committed by him attracted any other consequences, they were not obliterated by sub-s (4) of s. 139. Then the Court observed: "There is no doubt that sub-s (1) of s. 139 has to be r/w sub-s (1) of s. 139, so as to permit the filing of a valid return whether of income, profits or gains or of loss, but it cannot be constructed so as to wipe out the limit of time referred to in sub-s (1) of s. 139 altogether and for all purposes". 8. Similar observations have been made by the Orissa High Court in CIT vs. Gangaram Chapolia 1975 CTR (Ori) 25 : (1976) 103 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment may be on the same footing as a return contemplated by s. 139(1)." 10. The Madhya Pradesh High Court, in the case of Chunnilal Bros. vs. CIT 1978 CTR (MP) 308 : (1979) 119 ITR 199 (MP) has also similar observations, which would be found of that report: "It must, therefore, be held that the default made under s. 139(1) ceases only on filing the return whether in answer to the notice under s. 139(2) or under s. 139(4) and that the default is not either arrested or wiped out on a notice being issued under s. 139(2). It is also clear that the filing of a return in accordance with s. 139 (4) does not absolve the assessee from the liability of penalty under s. 271(1)(a)." 11. The Bombay High Court had considered all these decisions in CIT vs. D.V. Save (1979) 119 ITR 266 (Bom). They have specifically approved of the decision of the Gujarat High Court in (1974) 93 ITR 563 (Guj) in the analysis of the provision of s. 139. 12. The above authorities clearly support our findings that the statute contemplates only two types of returns either a voluntary return or a return in response to a notice. Sec. 139(4) allows the assessee to comply with the terms of ss. 139(1) and 139(2) a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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