Invalid return under section 139(9) cannot be processed as a valid return under section 143(1).

A return treated as invalid under section 139(9) is to be regarded as non-existent for processing under section 143(1), which applies only to a valid return furnished under section 139 or in response to notice under section 142(1). The Central Processing of Returns Scheme, 2011 also distinguishes invalid or defective returns from valid returns and permits processing of an invalid return only on the basis of available information, not as a valid return for regular adjustment of claims. Accordingly, an intimation issued by processing such an invalid return as a valid return was unsustainable.

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Issues: Whether a return treated as an invalid return under section 139(9) of the Income-tax Act, 1961 could thereafter be processed under section 143(1) of the Income-tax Act, 1961.

Analysis: Section 139(9) provides that where the defect is not rectified within the permitted time, the return is to be treated as an invalid return and the law applies as if the assessee had failed to furnish the return. Section 143(1) contemplates processing only of a return made under section 139 or in response to notice under section 142(1). The Central Processing of Returns Scheme, 2011, particularly Rules 6 and 8, also distinguishes between invalid or defective returns and valid returns, and permits processing of an invalid return only on the basis of information available, not as a valid return for regular adjustment of claims.

Conclusion: Once the return was treated as invalid under section 139(9), it could not be processed as a valid return under section 143(1); the intimation issued on that basis was held unsustainable, in favour of the assessee.

Ratio Decidendi: A return treated as invalid under section 139(9) is to be regarded as non-existent for the purpose of processing under section 143(1), which applies only to a valid return furnished under section 139 or in response to section 142(1).

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