Reassessment returns cannot create fresh exemption claims where no timely return was filed under section 139.

A return filed in response to a notice under section 148 cannot be used to originate a fresh claim for exemption under sections 11 and 12 where no return under section 139 was filed within time. Reassessment proceedings under section 147 are directed to bringing escaped income to tax and cannot be converted into a forum for entirely new substantive claims. Applying Sun Engineering Works and a later Special Bench view, the text explains that the deeming effect of a reassessment return does not create a new right to claim relief that was never raised in the original proceedings.

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Issues: Whether the assessee, having not filed returns under section 139 within the prescribed time, could claim exemption under sections 11 and 12 for the first time in returns filed in response to notices under section 148, and whether such reassessment proceedings could be used to entertain a fresh exemption claim.

Analysis: The return filed in response to a notice under section 148 is not to be read in isolation from the scheme and object of reassessment. Reassessment under section 147 is meant to bring escaped income to tax, and the deeming character of a return filed under section 148 cannot be expanded to create a substantive right to raise a fresh exemption claim that was never made in the original proceedings. The binding principle in Sun Engineering Works was applied, and the later Special Bench view was relied upon to hold that reopening proceedings are for the benefit of the Revenue and cannot be converted into a forum for entirely new claims. The cases cited by the assessee were distinguished as they did not concern a complete failure to file a return under section 139 followed by a fresh claim only after reopening.

Conclusion: The assessee was not entitled to claim exemption under sections 11 and 12 for the first time in returns filed under section 148, and the Revenue's grounds were allowed.

Ratio Decidendi: A return filed in response to reassessment notice cannot be used to originate a fresh exemption claim where no return under section 139 was filed within time, because reassessment proceedings are intended to assess escaped income and not to confer new substantive reliefs on the assessee.

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