Court Upholds Second Revised Return Filing, Extends Assessment Time

The court ruled in favor of the department, upholding the validity of filing a second revised return under section 139(5) of the Income-tax Act, 1961. It was determined that a second revised return can be submitted after an initial revised return, extending the time for assessment completion under section 153(1)(c). The court emphasized that a revised return under section 139(5) supersedes the original return, allowing for corrections and amendments. The decision affirmed the practice of accepting multiple revised returns and granted costs of Rs. 200 to the department, with counsel fees set at the same amount.

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Issues involved:
The validity of the second revised return filed u/s 139(5) of the Income-tax Act, 1961 and the extension of time for assessment completion u/s 153(1)(c) of the same Act.

Validity of Second Revised Return:
The assessee filed a return u/s 139(1) showing an income of Rs. 55,489, followed by a revised return u/s 139(5) on March 2, 1971, showing an income of Rs. 50,273. Subsequently, a second revised return was filed on February 8, 1972, indicating an income of Rs. 38,138. The contention was raised that the second revised return could not be filed u/s 139(5), thus the extended limitation period u/s 153(1)(c) was not applicable. However, the AAC and the Tribunal rejected this argument.

Interpretation of Section 139(5):
The dispute centered around whether a second revised return could be filed under s. 139(5) after an initial revised return. The court analyzed s. 139(5) which allows for a revised return to be furnished before assessment if any omission or wrong statement is discovered in the original return. The court emphasized that once a revised return is filed under s. 139(5), it supplants the original return, thereby allowing for corrections or amendments. Referring to previous cases, it was established that a revised return under s. 139(5) is akin to a return u/s 139(1), enabling the filing of subsequent revised returns to rectify errors.

Extension of Assessment Completion Time:
The court held that the filing of a second revised return under s. 139(5) extends the limitation period for assessment completion u/s 153(1)(c). Recognizing the practical need for correcting mistakes in returns, the court affirmed the practice of accepting multiple revised returns by the department. Consequently, both questions were answered in the affirmative in favor of the department, allowing for the completion of assessment within the extended timeframe. The department was awarded costs amounting to Rs. 200, with counsel fees assessed at the same figure.

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