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TMI Blog2008 (1) TMI 518X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. (iii) The learned CIT(A), Ahmedabad, further erred in law and on facts in not appreciating that the assessee has not removed the defects even after opportunity was given for the same by the AO. Therefore, the so-called original return was invalid and the revised return so filed was treated as original and since it was late the carry forward of loss was rightly disallowed by the AO. (iv) The learned CIT(A), Ahmedabad, erred in law and on facts in directing the AO to delete the credit of Rs. 11 lacs standing in the name of Shri Ravi Ghai. (v) The learned CIT(A), Ahmedabad, grievously entertained new evidence without giving an opportunity to the AO for verifying the genuineness, creditworthiness etc. of the creditor as provided und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. The revised return was processed under s. 143(1) of the Act on 25th June, 1991 computing the assessee's income as per revised return which was loss and refund was allowed. 4.1. Later on, the AO proceeded to make assessment under s. 143(3) of the Act and while doing so, refused the assessee's claim of loss on the ground that the return of income furnished on 31st Dec., 1990 was defective and the assessee having not removed the defect within the period of 15 days allowed as per notice dt. 22nd Dec., 1992, the same could not be taken into account. The refused (revised) return was also not taken care of. The AO computed the assessee's loss at Rs. 15,12,800 after adding an income of Rs. 11,00,000 under s. 68 of the IT Act to the loss comput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the assessment year under appeal without being accompanied by audit report and accounts would not be invalid return. It could at best be termed as either incomplete return or defective return but certainly not invalid return. Not only that the AO has not brought on record any material regarding acceptance or non-acceptance of letter dt. 5th Feb., 1991 having been filed by the appellant requesting extension of time for filing return of income under s. 139(9). Having considered the matter carefully, I see no justification for rejection of appellant's claim of carried forward losses. The AO is directed to allow the same according to law after considering appellant's applications for rectification which are pending before the AO for allowi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r furnishing the return on an application made in the prescribed manner. It is incumbent upon the ITO, as empowered by s. 139(1) proviso, to take a decision on the application for extension of time for filing the return and to communicate the decision to the assessee concerned. The discretion vested in the ITO has to be exercised fairly and judiciously, since such a decision is bound to affect the rights of the assessee and the failure to communicate the same is bound to affect it adversely. An order, to be considered valid and effective, must be communicated to the person concerned, who is to be directly affected by that order. Non-communication of an order, which is likely to have a detrimental effect upon the person concerned, would not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his point is, therefore, confirmed. 9. So far as addition under s. 68 of the IT Act is concerned, the learned Departmental Representative did not advance any argument and, therefore, we are of the opinion that the CIT(A) was justified in deleting the addition on the ground that all the loans were old loans. 10. Before ending with the issue, we would like to record that the learned Departmental Representative had relied on two decisions; namely: decision in the case of- (1) Dhampur Sugar Mills Ltd. vs. CIT (1973) 90 ITR 236 (All); (2) Chief CIT (Admn.) Anr. vs. Machine Tool Corporation of India Ltd. (1992) 108 CTR (Kar) 110. 10.1. After considering the aforesaid decisions, we are of the opinion that the assessee's original return ..... X X X X Extracts X X X X X X X X Extracts X X X X
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