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TMI Blog2003 (3) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... turn of income?" The assessment year is 1985-86 and the relevant accounting period is the year ended on March 31, 1985. Return of income was due on July 31, 1985, but was filed on December 23, 1985. The Assessing Officer while finalising the assessment on March 15, 1988, computed business loss at Rs. 2,35,461 but did not permit carry forward of the same by observing "... As the return is not filed within the statutory period, the loss of Rs. 2,35,461 is not allowed to be carried forward ..." The assessee carried the matter in appeal before the Commissioner of Income-tax (Appeals) who reversed the order of the Assessing Officer and held that the assessee was entitled to carry forward the business loss computed by the Assessing Officer. According to the Commissioner of Income-tax (Appeals) the assessee had filed Form No. 6 on June 28, 1985, vide acknowledgment slip No. 560733 seeking extension of time up to December 31, 1985, to submit the return of income. The said application was neither rejected nor granted by the Assessing Officer and, therefore, the assessee was entitled to presume that extension had been granted. For this purpose, the Commissioner of Income-tax (Appeals) pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as recorded by the Commissioner of Income-tax (Appeals) the applicant-assessee had applied for extension of time for submitting the return of income and the said application was neither rejected nor granted. Thus, the assessee was entitled to presume that the time prayed for was granted. That if the extension application was considered to have been granted, the assessee having sought extension up to December 31, 1985, the return of income tendered on December 23, 1985, was within time and the assessee could not be denied the benefit of carrying forward business loss. In support of the submission made, she placed reliance on decision of this court in case of CIT v. Gordhanbhai Jethabhai [1983] 142 ITR 84 as well as the following decisions of the High Courts of Madras, Calcutta, Rajasthan and Kerala: (i) CIT v. Dolerite Pvt. Ltd. [1996] 217 ITR 318 (Mad); (ii) CIT v. Janata Film Exchange (P.) Ltd. [1993] 202 ITR 532 (Cal); (iii) Rajasthan Cylinders and Containers Ltd. v. CIT [2003] 259 ITR 95 (Raj); and (iv) CIT v. Panavision Electronics (Kerala) (P.) Ltd. [2003] 264 ITR 710 (Ker). Mr. M.R. Bhatt, learned senior standing counsel appearing on behalf of the respondent, submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8). Rule 13 of the Income-tax Rules, 1962, deals with application for extension of time for filing return of income and it lays down that the application to the Income-tax Officer under the proviso to sub-section (1), or the proviso to subsection (2), or sub-section (3), of section 139, for seeking an extension of the date for furnishing the return of income shall be in Form No. 6. As already pointed out above, applications in Form No. 6 were made on behalf of the assessee for extension of time. It is, however, contended on behalf of the Revenue that the applications which were made on behalf of the assessee were not made in the prescribed manner inasmuch as they were not signed by the person authorised to sign on behalf of the assessee. The Income-tax Officer, therefore, could have ignored these applications. In other words, according to the Revenue, it was not incumbent upon the Income-tax Officer to render his decision on the applications made on behalf of the assessee. As pointed out above, proviso to sub-section (1) of section 139 empowers the Income-tax Officer to extend the date for furnishing the return. It is obvious that there is a corresponding duty on the Income-tax Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was granted in the absence of any order of grant or rejection being communicated. As recorded by the Tribunal the facts are undisputed. It is not the case of the Revenue, as was in the matter of CIT v. Gordhanbhai Jethabhai [1983] 142 ITR 84 (Guj), that the application was defective or invalid in any manner. Though that cannot be a ground for not exercising the discretion vested in the Assessing Officer. There is a mandate on the authority to exercise its power when called upon to do so. The authority cannot refuse to exercise the same by ignoring an application. This is a jurisdictional error. The Tribunal has committed an error of law by not dealing with this issue indicating total non-application of mind. In the circumstances, the Tribunal was not justified in reversing the order of the Commissioner of Income-tax (Appeals) and denying the benefit of carry forward of business loss by treating the return of loss as having been filed beyond the-stipulated date or the extended period. Before parting, it is necessary to take note of the fact that the Tribunal has, to say the least, approached the matter very cursorily and in a casual manner. The extract from the Tribunal's order r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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