Judgment:
A.R. Dave, J.
1. At the instance of the applicant assessee, the Tribunal, Ahmedabad Bench 'A' has referred to this Court the following question of law arising out of its order passed in ITA No. 663/Ahd./1981, dt. 24th March, 1984, for the opinion of this Court under s. 256(1) of the IT Act, 1961 (hereinafter referred to as the 'the Act') :
'Whether, on the facts and in the circumstances of the case, the assessment made by the ITO is barred by limitation ?'
2. Learned counsel Shri B. B. Naik has appeared for the Revenue whereas nobody has appeared for the applicant-assessee.
3. For the asst. yr. 1973-74 the assessee had filed his return on 14th August, 1973. As a matter of fact, he was expected to file his return before 30th June, 1973, as his accounting year was ending on 31st March, 1973. Before 30th June, 1973, on 20th June, 1973, the Central Board of Direct Taxes (CBDT) issued a circular being Circular No. 113 granting extension of time for furnishing returns of income and net wealth for the asst. yr. 1973-74 till 15th August, 1973 in cases where returns were due to be filed by 30th June, 1973 or 31st July, 1973. During the said extended period the assessee had filed his return for the asst. yr. 1973-74. Thereafter, the assessee filed a revised return under the provisions of s. 139(5) of the Act on 22nd March, 1976. As per the first return which was filed on 14th August, 1973, the income of the assessee was Rs. 10,904 whereas as per the revised return, he had shown his income to be Rs. 11,304. The ITO processed the revised return filed on 22nd March, 1976 and completed the assessment on 15th March, 1977.
4. Being aggrieved by the assessment order, the assessee had filed an appeal before the AAC which was rejected and being aggrieved by the said order passed in the appeal, the assessee had approached the Tribunal. It was mainly submitted by the assessee that as the assessee had filed his first return under the provision of s. 139(4) of the Act, the revised return which the assessee had filed on 22nd March, 1976 ought to have been treated as non est because the revised return could have been filed by the assessee only if he had filed his income tax return under the provisions of s. 139(1) or s. 142(1) of the Act, the assessee could not have filed any revised return and, therefore, the revised return filed by the assessee could not have been treated as a valid return. In the circumstances, it was further submitted that as the first return filed by the assessee was under the provisions of s. 139(4) of the Act, the assessment ought to have been completed before 31st March, 1976 as per the provisions of s. 153 of the Act and as the assessment was not framed within the period of limitation prescribed under the provisions of s. 153 of the Act, the order of assessment was bad in law.
5. The Tribunal rejected the arguments referred to hereinabove and came to the conclusion that as the return was filed by the assessee within the period extended by the CBDT under its Circular No. 113, the return can be said to have been filed under the provisions of s. 139(1) of the Act and not under the provisions of s. 139(4) of the Act. Consequently it has held that the provisions of s. 153(1)(c) had not been violated and the assessment was framed within the period prescribed under the Act.
6. The question in short is, whether a revised return can be filed if the assessee has filed his earlier return under the provisions of s. 139(1) of the Act during the period extended by the CBDT. Looking to the facts of the case, it is clear that the assessee had not filed return before 30th June, 1973 under the provisions of s. 139(1) of the Act. Before the period within which the assessee had to file his return under the provisions of s. 139(1) of the Act, had come to an end, the CBDT had issued the circular referred to hereinabove whereby time for furnishing returns was extended up to 15th August, 1973. In the above set of circumstances, the assessee was perfectly justified in filing his return before 15th August, 1973.
7. Section 139(1) of the Act, as it was at the relevant time, did permit the assessee to file his return even after 30th June, 1973, the date by which ordinarily the assessee was supposed to file his return. The proviso to s. 139(1) of the Act had given discretion to the ITO to extend the date for furnishing the return beyond 30th June, 1973, in certain circumstances. If in a given case, the ITO uses his discretion in pursuance of an application by the assessee and grants an extension to the assessee and if the assessee furnishes his return within the period extended can it be said that the return was not furnished as per provisions of s. 139(1) of the Act Our answer to this question would be surely in negative. After availing the benefit of the discretion of the authority, the assessee cannot be permitted to say that the return furnished by him was not under the provisions of s. 139(1) of the Act.
8. In the instant case, the CBDT had exercised its power instead of leaving it to the ITO. On account of peculiar facts and circumstances prevailing at the relevant time, instead of giving instructions to all authorities to grant extension to all the assessees in the matter of furnishing returns, the CBDT itself exercised the said power and granted the extension to all assessees as a class. Effect of exercise of the said power in favour of all the assessees cannot be said to be different than the exercise of discretion by the ITO under the provisions of proviso to s. 139(1) of the Act.
9. In view of the circumstances stated hereinabove and in view of the facts that the assessee himself had furnished a revised return under the provisions of s. 139(5) of the Act, it cannot be said that the assessee had furnished his first return under the provisions of s. 139(4) of the Act. Moreover, prima facie it also appears that the assessee himself believed that he had furnished his first return under the provisions of s. 139(1) of the Act by taking an advantage of extension of time granted by the CBDT. Had it not been so the assessee would not have furnished his revised return on 22nd March, 1976. After having furnished the revised return, the assessee would be estopped from contending that his revised return was a nullity and therefore, the assessment made by the assessee (AO) was beyond the period of limitation as per the provisions of s. 153 of the Act.
10. Looking to the facts of the case and legal position discussed hereinabove we are of the opinion that as the first return furnished by the assessee was well within the time prescribed under the provisions of s. 139(1) of the Act, more particularly in the light of the proviso to s. 139(1) of the Act and the circular of the CBDT referred to hereinabove. The revised return can be validly treated as a return filed under the provisions of s. 139(5) of the Act and therefore, it cannot be said that the assessment was not made within the time-limit prescribed under the provisions of s. 153 of the Act and, therefore, we are of the view that the assessment made by the ITO was not barred by limitation.
11. In view of the facts stated hereinabove, the assessment made by the ITO was not barred by limitation and the AO was justified in framing the assessment on the basis of the revised return. We, therefore, answer the question referred to us in negative i.e., against the assessee and in favour of the Revenue.
12. The reference stands disposed of accordingly with no order as to costs.