Return invalid for missing assessee signature and verification under s.140; s.292B cannot cure defect, AO may issue notice under s.148

HC held the return was invalid because it lacked the assessee's signature and verification required by s.140 of the 1961 Act; s.292B's deeming effect cannot cure such a substantive defect. Consequently the Assessing Officer was entitled to proceed (including issuing notice under s.148), and the appeal was dismissed.

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Issues: Whether a return which is neither signed nor verified can be treated as a valid return by application of Section 292B of the Income-tax Act, 1961, or whether such defect renders the return invalid and justifies setting aside the assessment made thereon.

Analysis: The procedural framework for assessment requires that an assessee's return comply with conditions for validity and provides an opportunity to rectify defects under Section 139(9) of the Income-tax Act, 1961. Section 140 mandates that a return must be signed and verified by the assessee. Section 292B provides that returns or proceedings shall not be deemed invalid merely for mistakes, defects or omissions if they are in substance and effect in conformity with the intent and purpose of the Act. The issue turns on whether the absence of signature and verification is a substantive defect that can be cured by the deeming language of Section 292B or whether it is a fundamental requirement going to the existence of a return under Section 140. Where a return lacks the mandatory signature and verification, it fails to meet the statutory definition of a return and cannot be regarded as being in substance and effect in conformity with the Act; consequently Section 292B cannot be invoked to validate such an unsigned and unverified submission.

Conclusion: The unsigned and unverified submission is an invalid return; Section 292B does not cure the substantive defect. The appeal is dismissed and the assessment set aside is affirmed in favour of the assessee.

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