High Court Of Gujarat
CIT vs. Himgiri Foods Ltd.
Assessment Year : 1995-96
Section : 143(1)(a)
D.A. Mehta And Ms. H.N. Devani, JJ.
Tax Appeal No. 138 Of 2009
March 8, 2010
JUDGMENT
Ms. H.N. Devani, J.—In this appeal under s. 260A of the IT Act, 1961 (the Act), appellant-Revenue has proposed the following question stated to be a substantial question of law arising from the impugned order of Tribunal dt. 25th Jan., 2007 of the Tribunal :
“Whether the Tribunal is right in law and on facts in confirming the order passed by the CIT(A) in directing the AO to process revised return filed by the assessee under s. 143(1B) of the Act though the same was filed after the original return had already been processed under s. 143(1)(a) ?”
2. The assessment year is 1995-96. The respondent-assessee had filed its original return of income for the assessment year under consideration on 30th Nov., 1995 disclosing total income of Rs. 21,46,600. The said return was filed in time and was processed under s. 143(1)(a) of the Act. Within a period of one year from the relevant assessment year, the assessee on the basis of the opinion of the chartered accountant and tax expert, filed a revised return on 21st Jan., 1997, declaring business loss of Rs. 12,08,686. The revised return was occasioned because certain expenses which were of revenue nature remained to be claimed in the original return as they were debited to pre-operative expenses. The AO did not process the revised return under s. 143(1B) of the Act and intimated the assessee that he was not acting upon the revised return as assessment under s. 143(1)(a) was already completed. In the meantime, the assessee moved an application under s. 119 of the Act before the CIT, Gujarat-1, Ahmedabad on 27th Dec, 1999, requesting for issuance of directions to the AO to consider the revised return filed under s. 139(5) of the Act. The said application came to be rejected by CIT who also held that the claim of the assessee was devoid of any merit and that, s. 139(5) was not intended to provide a loophole for reducing the tax liability by extra legal means. The assessee, thereafter moved an application dt. 30th March, 2000 under s. 154 of the Act before the AO requesting him to take cognizance of the revised return under the provisions of s. 143(1B) of the Act. The AO rejected the said application holding that the revised return had been filed beyond the time-limit stipulated under s. 139(5) of the Act. While rejecting the said application the AO also placed reliance upon the order passed by CIT under s. 119 of the Act.
3. The assessee carried the matter in appeal before CIT(A) who recorded a finding that the revised return was filed on 21st Jan., 1997, but rejected the application on other grounds. The assessee carried the matter in further appeal before Tribunal, who, vide the impugned order dt. 25th Jan., 2007 allowed the appeal.
4. Mr. M.R. Bhatt, learned senior counsel appearing for the appellant-Revenue supported the orders passed by the AO and the CIT(A).
5. As can be seen from the impugned order of the Tribunal, the Tribunal has held that under s. 143(1B) of the Act, it is permissible for an assessee to file a revised return under s. 139(5) after issuance of the intimation and that the intimation already sent is required to be amended on the basis of the revised return; that the said provision does not permit the AO to consider the validity of the claim made by the assessee under s. 139(5) of the Act. The Tribunal recorded as a matter of fact that the revised return which was filed on 21st Jan., 1997, was within a period of one year from the date of filing of the original return. The Tribunal further found that although intimation as envisaged under s. 143(1) had been sent to the assessee prior to the filing of the revised return, the assessment had not been completed by the AO by that date. The Tribunal was of the view that an intimation under s. 143(1)(a) of the Act cannot be regarded to be an assessment and that if intimation under s. 143(1)(a) is treated as an assessment the provisions of s. 143(1B) would be rendered nugatory. The Tribunal held that s. 143(1B) makes it obligatory on the part of the AO to process the revised return provided it is filed within the time permitted under the Act and to revise the intimation that has already been issued by the AO. The Tribunal observed that in the order made under s. 154, the AO had not held that the revised return was invalid but had rejected the application on the ground that the return had been filed beyond time, whereas on the basis of evidence and the material filed before it, the Tribunal has found as a matter of fact that the revised return had been filed within the time permitted under s. 139(5) of the Act. The Tribunal, accordingly held that once the revised return was filed within time, the AO was bound to process it under s. 143(1B) of the Act.
6. Sub-s. (5) of s. 139 provides that if any person, having furnished a return under sub-s. (1), or in pursuance of a notice issued under sub-s. (1) of s. 142, discovers any omission or wrong statement therein, he may furnish a revised return at any time before the expiry of one year from the end of the relevant assessment year or before the completion of assessment, whichever is earlier.
7. In the present case the assessment year is 1995-96. It is an admitted position that only intimation under s. 143(1)(a) had been issued and that the assessment had not been completed when the revised return came to be filed. Hence, the assessee was entitled to furnish the revised return at any time before the expiry of one year from the end of asst. yr. 1995-96. From the facts noted hereinabove it is apparent that the revised return was filed on 21st Jan., 1997 which is well within the prescribed period.
8. Sec. 143(1B) as it stood between 1st April, 1989 to 31st May, 1999, insofar as the same is relevant for the purpose of the present appeal reads thus :
“(1B) Where an assessee furnishes a revised return under sub-s. (5) of s. 139 after the issue of an intimation, or the grant of refund, if any, under sub-s. (1) of this section, the provisions of sub-ss. (1) and (1A) of this section shall apply in relation to such revised return and—
(i)the intimation already sent for any income-tax, additional income-tax or interest shall be amended on the basis of the said revised return and where any amount payable by way of income-tax, additional income-tax or interest specified in the said intimation has already been paid by the assessee then, if any such amendment has the effect of—
(a)enhancing the amount already paid, the intimation amended under this clause shall be sent to the assessee specifying the excess amount payable by him and such intimation shall be deemed to be notice of demand issued under s. 156 and all the provisions of this Act shall apply accordingly;
(b)reducing the amount already paid, the excess amount shall be refunded to the assessee;
(ii)………….”
9. On a plain reading of s. 143(1B) it is apparent that the provision mandates that if after the issuance of intimation, a revised return is furnished by an assessee under sub-s. (5) of s. 139 it is incumbent upon the AO to process the revised return and amend the intimation issued under s. 143(1)(a) on the basis of the revised return. At this stage there is no question of going into the validity of the return filed under s. 139(5) of the Act, if the revised return is filed within the prescribed period of limitation. An intimation under s. 143(1)(a) of the Act cannot be equated with an assessment framed under s. 143(3) of the Act and the AO cannot refuse to process the revised return and modify the intimation in accordance with s. 143(1B) of the Act.
10. In the aforesaid facts and circumstances, it cannot be said that the impugned order of the Tribunal suffers from any legal infirmity so as to warrant interference. The appeal is, accordingly, dismissed in absence of any question of law, as proposed or otherwise, much less any substantial question.
[Citation : 333 ITR 508]
