Return under section 146 treated as a section 139 return, allowing loss carry forward under section 80

A return filed pursuant to an order under section 146, where a best judgment assessment is set aside because the assessee was prevented by sufficient cause from making the return required under section 139(2), is treated as a return filed under section 139. On that basis, the return satisfies section 80 as it then stood, and the assessee may carry forward the losses.

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Issues: Whether a return filed pursuant to an order under section 146 of the Income-tax Act, 1961, after a best judgment assessment is set aside for sufficient cause under section 139(2), can be treated as a return filed under section 139 for the purpose of section 80 so that losses may be carried forward.

Analysis: The return filed along with, or within the time specified in, the application under section 146 was held to be a return filed under section 139 where the best judgment assessment had been set aside on the ground that the assessee was prevented by sufficient cause from making the return required under section 139(2). On that footing, the return satisfied the requirement of section 80 as it then stood, and the losses were eligible to be carried forward.

Conclusion: Such a return is to be treated as a return filed under section 139 for the purpose of section 80, and the assessee is entitled to carry forward the losses.

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