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TMI Blog1979 (12) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... igned by the assessee was filed. First return without being signed was filed by the assessee on 29th Aug., 1975. By letter dt. 5th May, 1977, the assessee requested the ITO that it be allowed to rectify the defect in that the signature in the original return dt. 29th Aug., 1975 had been omitted. No opportunity for rectifying the defect was given to the assessee and the assessment order dt. 30th Aug., 1977 was passed on the basis of the return dt. 29th Aug., 1975 (20th Aug., 1976) wrongly mentioned by the ITO in the assessment order). On these facts, the assessee made an application under s. 154. Whereas, the said application was partly accepted by the ITO, the latter did not accept the plea of the assessee that interest under s. 139(8) was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 975 and for want of signature it cannot be said that no return within the meaning of s. 139 was filed on the said date. The CIT(A) rejected the submission of the assessee on the ground that the question whether or not there was a defect in the return dt. 29th Aug., 1975 was highly debatable and, therefore, the provisions of s. 154 could not be successfully invoked by the assessee. We do no approve the reasons given by the lower authorities. The first question for consideration is as to what is the effect of the omission of signature in the return dt. 29th Aug., 1975. In our opinion, Shri Sud is right in arguing that absence of signature in the return dt. 29th Aug., 1975 simply causes irregularity or defect and not invalidity. To support our ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rely on irregularity and on that analogy, we hold that the omission to sign the return dt. 29th Aug., 1975 is merely an irregularity and not an invalidity. Omission to sign the return dt. 29th Aug., 1975 being a curable defect the assessee addressed the letter dt. 5th May, 1977 to the ITO requesting him to allow an opportunity for rectifying the defect in the original return. At that stage no such opportunity was allowed by the ITO to the assessee to rectify the defect. It is amply clear from the record that the ITO did not treat the return dt. 29th Aug., 1975 at any stage to be invalid. We can go through the record in this connection in the chronological order. After the return dt. 29th Aug., 1975 was filed, the ITO issued two notices dt. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot be said that the return dt. 29th Aug., 1975 is invalid owing to the omission of signature. 4. Almost a similar case came up for consideration before the Madras High Court CIT Madras vs. Royal Textiles (1979) 120 ITR 506 (Mad). The facts of this case, in brief, are that the assessee firm filed a return in Form No. 3 on 10th March, 1968 for the asst. yr. 1967-68. The ITO made a provisional assessment under s. 141 of the IT Act on 20th May, 1968 and issued a demand requiring the assessee to pay Rs. 21,516 by way of tax. On 20th Aug., 1968, the ITO sent to the assessee a letter stating that he should file the return in Form No. 2 and enclosed a form with that letter. The assessee paid the tax provisionally assessed on 2nd Sept., 1968. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l that it was not open to the Department to contend that the said return was invalid and that interest should be charged for the period subsequent to 10th March, 1968. On these facts, the Madras High Court held though the assessee had used a wrong form, it did not mean that the return was non-est so that the return filed later in the correct form could be treated as the only return filed by the assessee. An innocuous mistake on the part of the assessee in choosing a wrong form cannot be treated as a mere scrap of paper and visit the assessee with a penalty of a substantial amount on the basis that this return solemnly filed is non-existent. The High Court continued to observe that when the ITO himself had acted on the return by making a pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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