9911796707
TMI Blog1996 (9) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... elief under section 80J of the Act. After adjustments of the above reliefs, the assessee's income as per the return was "nil". The Income-tax Officer forwarded to the assessee his draft assessment order under section 144B, dated March 23, 1977, proposing to assess the assessee's income prior to adjustment of carry forward losses and relief under section 80J at Rs. 4,28,12,165, and after adjustment of the above relief at Rs. 31,42,270. The assessee received the above draft order on March 29, 1977, and filed its objections. Before the completion of the assessment on September 26, 1977, the assessee filed a revised return claiming development rebate on the valuation, added to the cost of assets. The Income-tax Officer declined to consider the above revised return on the ground that he had become functus officio. The Income-tax Officer proceeded to make the assessment with reference to the assessee's first return. Before the Appellate Assistant Commissioner, the assessee contended that the revised return filed before the completion of the assessment on September 26, 1977, should have been considered by the Income-tax Officer. The Appellate Assistant Commissioner, however, rejected th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itation in the matter of completing the assessment under section 144B, held that the Income-tax Officer was not correct in ignoring the revised return filed under section 139(5) of the Act. Learned counsel appearing for the assessee further pointed out that the Tribunal has given cogent reasoning for holding that the revised return filed under section 139(5) should be taken into consideration in the present case before completing the assessment by the Income-tax Officer, since that would not affect the period of limitation, as per the facts arising in this case. We have heard both learned senior standing counsel appearing for the Department as well as learned counsel appearing for the assessee. In the present case, the facts on record go to show that the assessee filed its revised return on August 27, 1977, before the issue of the Inspecting Assistant Commissioner's directions under section 144B on September 23, 1977, and the Income-tax Officer's completion of the assessment was on September 26, 1977, under section 143(3). The original return for the assessment year 1974-75 was filed on August 26, 1974. The draft order, dated March 23, 1977, was sent to the assessee under secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment. Section 144B states with reference to the Inspecting Assistant Commissioner in certain cases that : (1) Notwithstanding anything contained in this Act, where in an assessment to be made under sub-section (3) of section 143, the Income-tax Officer proposes to make any variation in the income or loss returned which is prejudicial to the assessee and the amount of such variation exceeds the amount fixed by the Board under sub-section (6), the Income-tax Officer shall, in the first instance, forward a draft of the proposed order of assessment (hereafter in this section referred to as the draft order) to the assessee ; (2) On receipt of the draft order, the assessee may forward his objections, if any, to such variation to the Income-tax Officer within seven days of the receipt by him of the draft order or within such further period not exceeding fifteen days as the Income-tax Officer may allow on an application made to him in this behalf ; (3) If no objections are received within the period or the extended period aforesaid, or the assessee intimates to the Income-tax Officer the acceptance of the variation, the Income-tax Officer shall complete the assessment on the basis of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, the revised return was filed before completing the assessment. As per the provisions of section 153(1)(a)(iii), the period of limitation in completing the assessment would be two years from the end of the assessment year. In the present case, two years from the end of the assessment year 1974-75 would fall on March 31, 1977. If a revised return is filed under section 139(5), that would further extend the period of limitation by one year from the date of filing the revised return. The revised return was filed on August 27, 1977, and the one year period would expire on August 27, 1978. Therefore, in any view of the matter, the revised return was filed within the period of limitation in the matter of completing the assessment according to the facts arising in the present case. This was also the view expressed by the Tribunal after extracting the relevant provisions of the Act on this aspect. A duty is cast upon the Income-tax Officer to bring it to the notice of the Inspecting Assistant Commissioner when a revised return was filed under section 139(5) within the period of limitation after he has forwarded his draft order to the Inspecting Assistant Commissioner for his instruct ..... X X X X Extracts X X X X X X X X Extracts X X X X
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