Judgment

SHAH, J.- The Kulu Vallye Transport Co. (P.) Ltd.- hereinafter called the Company - did not file returns of income in respect of the assessment years 1953-54 and 1954-55 within the period specified in the general notice under Section 22 (1) of the Income-tax Act, 1922. In January 1956, the Company filed voluntary returns disclosing loss of income in the course of its business amounting to Rs. 1,151,520 and Rs. 48,977, respectively, for the two years in question. The Income-tax Officer refused to determine the loss observing:

"This is a loss case and the return has been filed after the statutory time. The Company is, therefore, not entitled to the benefit of carry-forward of loss in the subsequent assessments. The case is, therefore, filed."

2. Against the order of the Income-tax Officer, appeals were preferred to the Appellate Assistant Commissioner. That officer rejected the Company s request for extension for filing the returns, and dismissed the appeals, observing:

"The return made under Sec. 22 (2A) can only be taken to be a return under sub-section (1) of Section 22 for the purpose of this Act, if it is made within the statutory time prescribed in sub-section (2A) of the Section 22."

3. The Income-tax Appellate Tribunal in second appeal held that the expression "all the provisions of this Act shall apply as if it were a return under sub-section (1) in sub-section (2A) only applies to a valid return, i.e., return which is filed within the time limit prescribed under sub-section (1). The Tribunal rejected the contention that a voluntary return disclosing loss of income submitted after the expiry of the period for filing a return under sub-section (1) may be deemed to be a return under sub-section (3), and the loss disclosed therein must be determined under sub-section (2) of Section 24 to qualify the assessee to carry it in the following year.

4. At the instance of the assessee the Tribunal referred the following question to the High Court of Punjab:

"Whether the losses of Rs. 1,51,520 and of Rs. 48,977 returned by the assessee in Jan. 1956 for the assessment years 1953-54 and 1954-55. respectively, require in law to be determined and carried forward under Section 24 (2) of the Income-tax Act?"

The High Court answered the question in the affirmative . The Commissioner of Income-tax has appealed to this Court with certificate granted by the High Court.

5. Sub-section (2A) of Section 22 which was added to Section 22 by Section 14 of Act 25 of 1953 with effect from April 1, 1952, provides:

"If any persons who has not been served with a notice under sub-section (2) has sustained a loss of profits or gains in any year under the head "Profits and gains of business, profession, or vocation", and such loss of any part thereof would ordinarily have been carried forward under sub-section (2) of Section 24, he shall, if he is to be entitled to the benefit of the carry-forward of loss in any subsequent assessment, furnish within the time specified in the general notice given under sub-section (1) or within such further time as the Income-tax Officer in any case may allow, all the particulars required under the prescribed form of return of total income.....in the same manner as he would have furnished a return under sub-section (1) had his income exceeded the maximum amount not liable to income-tax in his case, and all the provisions of this Act shall apply as if it were a return under sub-section (1)." On the plain words used by the Parliament, sub-section (2A) applies only where the return is filed within the time specified in the general notice under sub-section (1) or within such further time as the Income-tax Officer may allow. A return not filed within the time prescribed by sub-section (1) or time extended by the Income-tax Officer does not comply with the requirement of sub-section (2A), and the assessee cannot claim that the loss be determined and carried forward.

6. The High Court, however, held that a voluntary return filed a