Dr. Vijaykumar Datla VS Assistant Commissioner of Income-tax

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

INCOME TAX APPELLATE TRIBUNAL, HYDERABAD
R.P. Garg, A. Venku Reddy, JJ.
Dr. Vijaykumar Datla -Appellant
Versus
Assistant Commissioner of Income-tax -Respondent
WT APPEAL NOS, 112,122 TO 128 (HYD.) OF 1995 IT APPEAL NOS. 731, 733 TO 738 AND 785 TO 791 (HYD.) OF 1995
Decided On : 28-03-1996

Advocates Appeared:
S. Venkatesan,Indra Kumar

ORDER

Garg, AM - In all these appeals, the assessment year involved is 1991-92. The returns for this year were to be filed voluntarily under section 139 of the Income-tax Act, 1961 before the due dates varying between 30th June, 1991 and 31st October, 1991. They were not filed. The Assessing Officer issued notices under section 142(1)(i) of the Income-tax Act in all these cases on 26-5-1992. The assessees did not file any return in pursuance thereof. Another notice was issued under section 142(1)(i) on 28-5-1993. The assessees filed returns on 22-12-1993. These returns were treated as invalid returns by the Assessing Officer as they were filed beyond one year from the end of the assessment year, i.e., 31-3-1991. The assessments were completed under section 144 of the Income-tax Act by ignoring the returns.

2. The main contention of the assessees is that it was a case of income escaping assessment and, therefore, the initiation of assessment proceedings without the issue of notice under section 148 in each case was invalid. Reference to Explanation 2(a) to section 147 was also made wherein income chargeable to tax is deemed to have escaped assessment if no return was furnished by the assessee. According, to the assessees, the provisions of section 148, being special provisions, would override the general provisions of section 142(1). It was further contended that the notices under section 142(1) were issued after the end of the assessment year and were, therefore, invalid and in that context our attention was invited to the provisions of section 139(2) before their deletion by Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989, requiring such a notice to be issued before the end of the assessment year. As the notice under section 142(1) is a substitution of the requirement under section 139(2), the time limit for its issuance in the assessment year is in built.

3. The revenue’s case, on the other hand, is that no such time limit, up to what time the notice could be issued ‘ is prescribed under section 142(1). As no outer limit is prescribed for its issuance, such a limit cannot, therefore, be inferred or read into the provision. A reference to the provisions of section 142(1) prior to their amendment w.e.f. 1-4-1990 was made wherein the notice calling upon an assessee to file return was to be issued only after the end of the assessee, it was, therefore, submitted that under the plain language of the section, the notice under section 142(1)(i) can be issued at any time after the assessee’s failure to file return under section 139. The irresistible conclusion, therefore, according to the learned departmental representative, is that proceedings for assessment were initiated in May 1992 and were to be pending up to 31-3-1994. The assessments were completed on 18-3-1994, i.e., during that period and before 31st March, 1994. In these circumstances, the issuance of notice under section 148 would be uncalled for, and in his submission, the Assessing Officer was right in completing the assessments on 18-3-1994 without issuing a notice under section 148. As regards Explanation 2(a) to section 147, a provision claimed to be a special provision, it was submitted by the learned departmental representative that it would not change the legal position. It is an enabling provision to issue a notice for assessing the escaped income on account of non-filing of a return by the assessee. The action for filing the return had already been initiated by the issue of notice under section 142(1)(i) and, therefore, the provisions of section 148 would not come into play and the consequences of filing or non-filing of return in pursuance thereof would follow. He further contended that the assessees filed the returns of income in pursuance of notices under section 142(1)(i) and, therefore, it would not be a case of income escaping assessment within the meaning of the provisions of clause (a) of Explanation 2 to section 147. In any case, he submitted, this

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INCOME TAX APPELLATE TRIBUNAL, HYDERABADR.P. Garg, A. Venku Reddy, JJ.Dr. Vijaykumar Datla -AppellantVersusAssistant Commissioner of Income-tax -RespondentWT APPEAL NOS, 112,122 TO 128 (HYD.) OF 1995 IT APPEAL NOS. 731, 733 TO 738 AND 785 TO 791 (HYD.) OF 1995Decided On : 28-03-1996

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INCOME TAX APPELLATE TRIBUNAL, HYDERABAD
R.P. Garg, A. Venku Reddy, JJ.
Dr. Vijaykumar Datla -Appellant
Versus
Assistant Commissioner of Income-tax -Respondent
WT APPEAL NOS, 112,122 TO 128 (HYD.) OF 1995 IT APPEAL NOS. 731, 733 TO 738 AND 785 TO 791 (HYD.) OF 1995
Decided On : 28-03-1996