Full Judgment Text
2011:BHC-OS:15924-DB
Dmt 1 wp2004-11
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGNAL CIVIL JURISDICTION
WRIT PETITION NO. 2004 OF 2011
M/s. Crawford Bayley & Co. .. Petitioner.
versus
Union of India & Ors. .. Respondents.
.....
Mr. Percy J. Pardiwala, Sr. Adv. with Ms. Aarti Sathe
for the Petitioner.
Mr. Suresh Kumar for Respondents.
......
CORAM : DR.D.Y.CHANDRACHUD &
A. A. SAYED, JJ.
01 DECEMBER 2011.
ORAL JUDGMENT : (PER DR.D.Y.CHANDRACHUD, J.)
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1. Rule. Learned Counsel for the Respondents waives
service. By consent taken up for final hearing on the request
of learned Counsel for the parties.
2. The Petitioner, which is a firm of Solicitors, has
challenged a communication dated 21 March 2011 by which a
return of income filed in the electronic format has been treated
as invalid on the ground that the ITRV form had not been
received by the Central Processing Centre of the Income Tax
Department at Bangalore.
3. For the Assessment Year 200910 the Petitioner
uploaded its return of income on 27 March 2010 on the official
website of the Income Tax Department. The Petitioner received
an electronically generated mail from the Department
acknowledging the efiling of the return of income. An
acknowledgment number was electronically generated and
furnished to the Petitioner (acknowledgment number
115760720270310. On 5 April 2010 in accordance with the
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instructions of the Department, the Petitioner posted a copy of
the ITRV Form duly signed by one of its partners. The Form
was remitted by ordinary post since the instructions of the
Department (Exhibit D ) specifically stipulated that the ITRV “ ”
should only be sent by ordinary post. It has been stated in
the instructions that a form sent by Speed Post, Registered Post
or Courier will not be accepted. The Form was required to be
submitted on or before 30 September 2009 or within a period
of sixty days whichever is later, from the date of transmitting
the data electronically.
4. On 16 May 2010 the Petitioner received a
communication stating that the ITRV Form had not been
received. The Petitioner was called upon to furnish a copy on
or before 31 March 2010 or within a period of 120 days of the
uploading of the electronic return data, whichever is later. The
Petitioner has stated that the ITRV Form was remitted under
certificate of posting initially on 5 April 2010 and thereafter
again on 18 May 2010. On 10 November 2010, the Petitioner
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received a communication stating that the Form had not been
received at the Centralized Processing Center. Hence, once
again on 18 November 2010, the Petitioner submitted a copy of
the Form which was transmitted by ordinary post. By a
communication dated 21 March 2011, the Petitioner has been
informed that though the electronic return was uploaded, it is
deemed never to have been filed since it was not duly verified
in terms of the provisions of Section 139 of the Income Tax
Act, 1961. The return is therefore, treated as invalid. By
letters dated 1 April 2011 and 11 May 2011 the Petitioner once
again reiterated that the ITRV Form had been transmitted on
5 April 2010, 18 May 2010 and 18 May 2010. Furthermore it
was pointed out to the Department that though on 5 April 2010
a representative had been deputed to Bangalore to deliver the
Form, she was not allowed to meet the Assistant Commissioner
of Income Tax in the Central Processing Centre.
5. The Court is informed that the problem has arisen
in the present case since for Assessment Year 200910
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arrangements were not made by the Income Tax Department
for verification of returns uploaded electronically by digital
signature. Such an arrangement has now been made from
Assessment Year 201112.
6. Section 139 (9) of the Income Tax Act, 1961
stipulates that where the Assessing Officer considers that a
return of income furnished by the assessee is defective, he may
intimate the defect to the assessee and furnish an opportunity
to rectify the defect within a period of fifteen days or within
such further period which, on an application made in this
behalf, the Assessing Officer may allow. If the defect is not
rectified within a period of fifteen days or the extended period
as allowed, the return shall notwithstanding the provisions of
law, be treated as an invalid return and the provisions of the
Act shall apply as if the assessee has failed to file the return.
The proviso to subsection (9) stipulates that where the
assessee rectifies the defect after the expiry of the said period
of fifteen days or the further period allowed, but before the
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assessment is made, the Assessing Officer may condone the
delay and treat the return as a valid return. The explanation
to subsection (9) provides that a return of income shall be
treated as defective unless all conditions prescribed therein are
fulfilled. Amongst the conditions, the condition in clause (a) is
that the annexures, statements and columns in the return of
income relating to computation of income chargeable under
each head of income, computation of gross total income and
total income have been duly filled in.
7. Treating a return filed by the assessee as an invalid
return has serious consequences. Parliament has in sub
section (9) of Sectiion 139 made adequate provisions for the
Assessing Officer to furnish in the first instance a period of
fifteen days to rectify a defect in the return. A provision has
been made for extension of the period within which the
defects have to be rectified. Thereafter under the proviso, it
is stipulated that where an assessee rectifies a defect even after
the expiry of fifteen days or the further period allowed, but
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before an assessment is made, the Assessing Officer may
condone the delay and treat the return as a valid return.
These are powers which are vested in the Assessing Officer.
8. Though the Income Tax Department made a
provision for electronic filing of returns, it appears that the
ITRV Form containing the due verification of the return of the
assessee was required to be remitted only by ordinary post.
The instructions which were furnished to assessees, a copy of
which has been placed on record, specifically stipulate that the
ITRV form should not be sent either by registered post or by
speed post or courier. The assessee has furnished adequate
material before the Court in support of its contention that
having filed the return electronically, it had also submitted the
ITRV form by ordinary post. The assessee has done so on 5
April 2010, 18 May 2010 and 18 November 2010. In that view
of the matter, we are of the view that the communication
issued by the Income Tax Department on 21 March 2011 is
thoroughly misconceived. The order of assessment for
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assessment year 200910, the Court is informed by the learned
Counsel for the assessee, has still not been passed. Hence, the
provisions of Section 139 (9) can be fulfilled by permitting the
assessee to file a verification of the return before the Assessing
Officer within a period of one week from today. Learned
Counsel appearing on behalf of the Petitioner states that this
would be done without any delay and in any event within a
week. In that view of the matter and with the aforesaid
direction, we quash and set aside the impugned order dated 21
March 2011.
9. Rule is made absolute in the aforesaid terms.
There shall be no order as to costs.
(Dr. D.Y. Chandrachud, J.)
(A. A. Sayed, J.)
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGNAL CIVIL JURISDICTION
WRIT PETITION NO. 2004 OF 2011
M/s. Crawford Bayley & Co. .. Petitioner.
versus
Union of India & Ors. .. Respondents.
.....
Mr. Percy J. Pardiwala, Sr. Adv. with Ms. Aarti Sathe
for the Petitioner.
Mr. Suresh Kumar for Respondents.
......
CORAM : DR.D.Y.CHANDRACHUD &
A. A. SAYED, JJ.
01 DECEMBER 2011.
ORAL JUDGMENT : (PER DR.D.Y.CHANDRACHUD, J.)
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1. Rule. Learned Counsel for the Respondents waives
service. By consent taken up for final hearing on the request
of learned Counsel for the parties.
2. The Petitioner, which is a firm of Solicitors, has
challenged a communication dated 21 March 2011 by which a
return of income filed in the electronic format has been treated
as invalid on the ground that the ITRV form had not been
received by the Central Processing Centre of the Income Tax
Department at Bangalore.
3. For the Assessment Year 200910 the Petitioner
uploaded its return of income on 27 March 2010 on the official
website of the Income Tax Department. The Petitioner received
an electronically generated mail from the Department
acknowledging the efiling of the return of income. An
acknowledgment number was electronically generated and
furnished to the Petitioner (acknowledgment number
115760720270310. On 5 April 2010 in accordance with the
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instructions of the Department, the Petitioner posted a copy of
the ITRV Form duly signed by one of its partners. The Form
was remitted by ordinary post since the instructions of the
Department (Exhibit D ) specifically stipulated that the ITRV “ ”
should only be sent by ordinary post. It has been stated in
the instructions that a form sent by Speed Post, Registered Post
or Courier will not be accepted. The Form was required to be
submitted on or before 30 September 2009 or within a period
of sixty days whichever is later, from the date of transmitting
the data electronically.
4. On 16 May 2010 the Petitioner received a
communication stating that the ITRV Form had not been
received. The Petitioner was called upon to furnish a copy on
or before 31 March 2010 or within a period of 120 days of the
uploading of the electronic return data, whichever is later. The
Petitioner has stated that the ITRV Form was remitted under
certificate of posting initially on 5 April 2010 and thereafter
again on 18 May 2010. On 10 November 2010, the Petitioner
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received a communication stating that the Form had not been
received at the Centralized Processing Center. Hence, once
again on 18 November 2010, the Petitioner submitted a copy of
the Form which was transmitted by ordinary post. By a
communication dated 21 March 2011, the Petitioner has been
informed that though the electronic return was uploaded, it is
deemed never to have been filed since it was not duly verified
in terms of the provisions of Section 139 of the Income Tax
Act, 1961. The return is therefore, treated as invalid. By
letters dated 1 April 2011 and 11 May 2011 the Petitioner once
again reiterated that the ITRV Form had been transmitted on
5 April 2010, 18 May 2010 and 18 May 2010. Furthermore it
was pointed out to the Department that though on 5 April 2010
a representative had been deputed to Bangalore to deliver the
Form, she was not allowed to meet the Assistant Commissioner
of Income Tax in the Central Processing Centre.
5. The Court is informed that the problem has arisen
in the present case since for Assessment Year 200910
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arrangements were not made by the Income Tax Department
for verification of returns uploaded electronically by digital
signature. Such an arrangement has now been made from
Assessment Year 201112.
6. Section 139 (9) of the Income Tax Act, 1961
stipulates that where the Assessing Officer considers that a
return of income furnished by the assessee is defective, he may
intimate the defect to the assessee and furnish an opportunity
to rectify the defect within a period of fifteen days or within
such further period which, on an application made in this
behalf, the Assessing Officer may allow. If the defect is not
rectified within a period of fifteen days or the extended period
as allowed, the return shall notwithstanding the provisions of
law, be treated as an invalid return and the provisions of the
Act shall apply as if the assessee has failed to file the return.
The proviso to subsection (9) stipulates that where the
assessee rectifies the defect after the expiry of the said period
of fifteen days or the further period allowed, but before the
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assessment is made, the Assessing Officer may condone the
delay and treat the return as a valid return. The explanation
to subsection (9) provides that a return of income shall be
treated as defective unless all conditions prescribed therein are
fulfilled. Amongst the conditions, the condition in clause (a) is
that the annexures, statements and columns in the return of
income relating to computation of income chargeable under
each head of income, computation of gross total income and
total income have been duly filled in.
7. Treating a return filed by the assessee as an invalid
return has serious consequences. Parliament has in sub
section (9) of Sectiion 139 made adequate provisions for the
Assessing Officer to furnish in the first instance a period of
fifteen days to rectify a defect in the return. A provision has
been made for extension of the period within which the
defects have to be rectified. Thereafter under the proviso, it
is stipulated that where an assessee rectifies a defect even after
the expiry of fifteen days or the further period allowed, but
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before an assessment is made, the Assessing Officer may
condone the delay and treat the return as a valid return.
These are powers which are vested in the Assessing Officer.
8. Though the Income Tax Department made a
provision for electronic filing of returns, it appears that the
ITRV Form containing the due verification of the return of the
assessee was required to be remitted only by ordinary post.
The instructions which were furnished to assessees, a copy of
which has been placed on record, specifically stipulate that the
ITRV form should not be sent either by registered post or by
speed post or courier. The assessee has furnished adequate
material before the Court in support of its contention that
having filed the return electronically, it had also submitted the
ITRV form by ordinary post. The assessee has done so on 5
April 2010, 18 May 2010 and 18 November 2010. In that view
of the matter, we are of the view that the communication
issued by the Income Tax Department on 21 March 2011 is
thoroughly misconceived. The order of assessment for
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assessment year 200910, the Court is informed by the learned
Counsel for the assessee, has still not been passed. Hence, the
provisions of Section 139 (9) can be fulfilled by permitting the
assessee to file a verification of the return before the Assessing
Officer within a period of one week from today. Learned
Counsel appearing on behalf of the Petitioner states that this
would be done without any delay and in any event within a
week. In that view of the matter and with the aforesaid
direction, we quash and set aside the impugned order dated 21
March 2011.
9. Rule is made absolute in the aforesaid terms.
There shall be no order as to costs.
(Dr. D.Y. Chandrachud, J.)
(A. A. Sayed, J.)
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