TaxTMI 
TaxTMI 
2003 (3) TMI 7
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.... of Rs. 2,35,461 is not allowed to be carried forward ..." The assessee carried the matter in appeal before the Commissioner of Income-tax (Appeals) who reversed the order of the Assessing Officer and held that the assessee was entitled to carry forward the business loss computed by the Assessing Officer. According to the Commissioner of Income-tax (Appeals) the assessee had filed Form No. 6 on June 28, 1985, vide acknowledgment slip No. 560733 seeking extension of time up to December 31, 1985, to submit the return of income. The said application was neither rejected nor granted by the Assessing Officer and, therefore, the assessee was entitled to presume that extension had been granted. For this purpose, the Commissioner of Income-tax (Appeals) placed reliance on decision of this court in the case of CIT v. Gordhanbhai Jethabhai [1983] 142 ITR 84. The Revenue carried the matter in appeal before the Tribunal and the Tribunal reversed the order of the Commissioner (Appeals). While passing the impugned order on October 19, 1992, the Tribunal observed as under: "The return was due on July 31, 1985, but the same was filed on December 23, 1985. According to the assessee, vide Form No....
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....tendered on December 23, 1985, was within time and the assessee could not be denied the benefit of carrying forward business loss. In support of the submission made, she placed reliance on decision of this court in case of CIT v. Gordhanbhai Jethabhai [1983] 142 ITR 84 as well as the following decisions of the High Courts of Madras, Calcutta, Rajasthan and Kerala: (i) CIT v. Dolerite Pvt. Ltd. [1996] 217 ITR 318 (Mad); (ii) CIT v. Janata Film Exchange (P.) Ltd. [1993] 202 ITR 532 (Cal); (iii) Rajasthan Cylinders and Containers Ltd. v. CIT [2003] 259 ITR 95 (Raj); and (iv) CIT v. Panavision Electronics (Kerala) (P.) Ltd. [2003] 264 ITR 710 (Ker). Mr. M.R. Bhatt, learned senior standing counsel appearing on behalf of the respondent, submitted that the Tribunal had not committed any error which would call for any intervention by this court. That as recorded by the Tribunal as part of the submissions made on behalf of the Department, the decision of this court could not be applied to the facts of this case as the same was rendered in the context of penalty leviable for late submission of return under section 271(1)(a) of the Act. He, therefore, submitted that the reference be reje....
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.... on behalf of the assessee for extension of time. It is, however, contended on behalf of the Revenue that the applications which were made on behalf of the assessee were not made in the prescribed manner inasmuch as they were not signed by the person authorised to sign on behalf of the assessee. The Income-tax Officer, therefore, could have ignored these applications. In other words, according to the Revenue, it was not incumbent upon the Income-tax Officer to render his decision on the applications made on behalf of the assessee. As pointed out above, proviso to sub-section (1) of section 139 empowers the Income-tax Officer to extend the date for furnishing the return. It is obvious that there is a corresponding duty on the Income-tax Officer to render his decision on the application made to him and communicate it to the assessee concerned. He has no doubt discretion whether or not to extend the date, but such discretion has to be exercised judicially and not arbitrarily. In other words, he has to exercise the discretion fairly and reasonably. He, however, cannot refuse to use discretion one way or the other and ignore the application for extension made to him in the prescribed fo....
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....ise its power when called upon to do so. The authority cannot refuse to exercise the same by ignoring an application. This is a jurisdictional error. The Tribunal has committed an error of law by not dealing with this issue indicating total non-application of mind. In the circumstances, the Tribunal was not justified in reversing the order of the Commissioner of Income-tax (Appeals) and denying the benefit of carry forward of business loss by treating the return of loss as having been filed beyond the-stipulated date or the extended period. Before parting, it is necessary to take note of the fact that the Tribunal has, to say the least, approached the matter very cursorily and in a casual manner. The extract from the Tribunal's order reproduced hereinbefore shows that the earlier portion of the paragraph narrates the facts; thereafter the submissions of the departmental representative are summarised, followed by a summary of the submissions made on behalf of the assessee. The only reasoning, if one can say it to be a reason, which appears in the Tribunal's order is "Therefore, the benefit of the order relied upon by the assessee cannot be extended to the assessee's case. Therefore....