Carry-forward of business loss under section 80 was allowed for a return filed within section 139(4).

An assessee who filed the return within section 139(4), though not within section 139(1), was held entitled to carry forward business loss because section 80, as applicable to the assessment year, required only that the loss be determined in pursuance of a return filed under section 139. The later amendment requiring filing within the time allowed under section 139(1) or extended time was held to be prospective and not applicable to the year in question, so the carry-forward claim succeeded.

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Issues: Whether an assessee who filed the return within the time permitted under section 139(4) of the Income-tax Act, 1961, but not within section 139(1), was entitled to carry forward business loss under section 80 as it then stood.

Analysis: Section 80, for the relevant assessment year, required only that the loss should have been determined in pursuance of a return filed under section 139. The return in question was admittedly filed under section 139(4), and therefore satisfied the statutory requirement then in force. The later amendment substituting the words referring to filing within the time allowed under section 139(1) or further time allowed by the Income-tax Officer was held to be prospective and not applicable to the assessment year in question.

Conclusion: The assessee was entitled to carry forward the business loss, and the reference was answered in favour of the assessee and against the Revenue.

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