1995 (1) TMI 133

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....sued by the Assessing Officer (A.O.) under section 139(2) to all of them to file their returns of income.The assessees failed to comply with the said notice. Subsequently, notices under section 142(1) were also issued but no compliance was made in spite of several opportunities. The AO, therefore, completed the assessments under section 144 on 25-2-1985 on the basis of material available with him and estimated the incomes as follows : Non-Agricultural Agricultural Shri Rattanlal Dangi Rs. 2,14.430 Rs. 5,000 Shri Tolaram Dangi Rs. 2,14,930 Rs. 5,000 Shri Fatehlal Dangi Rs. 2,41,390 Rs. 5,000 3. Simultaneously the AO initiated penalty proceedings under section 271(1)(a). On appeal against the above assessments, the learned CIT(A) set asi....

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....ies and perused the material placed before us. 8. Firstly, we take up the issue regarding computation of delay. 9. Section 271(1)(a), as it then existed, read as under : " If the Assessing Officer or the Deputy Commissioner (Appeals) or the Commissioner (Appeals) in the course of any proceedings under this Act, is satisfied that any person-- (a) has failed to furnish the return of total income which he was required to furnish under sub-section (1) of section 139 or by notice given under sub-section (2) of section 139 or section 148 or has failed to furnish it within the time allowed and in the manner required by sub-section (1) of section 139 or by such notice as the case may be or..........." 10. In the instant cases it is undisputed ....

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....the default should be deemed to have ended on the day the AO, in absence of a return filed, makes up his mind to make the assessment to the best of his judgment on the basis of the material available with him. Such an interpretation sounds to be rational because it will serve the ends of justice between both the situations, namely, one who accepts the assessment under section 144 and then never files the return, and the other, where one files the return under set aside or re-assessment proceedings as his first return for that particular year. 15. In view of the above, the learned CIT(A) had rightly computed the default upto the date of the assessment made under section 144. 16. Coming to the grievance of the assessee as regards sustaining....