- (1.)THE appellant in the instant appeal is an individual and is aggrieved by the order of the Commissioner of Income-tax (Appeals) - IV [hereinafter referred to as CIT (A)] November 4, 1992. THE grievance as raised in the grounds of appeal concerns the refusal to allow carry forward of the loss on the reasoning that the return was filed beyond the time permitted under the Income-tax Act, 1961 (hereinafter referred to as the 'Act'). This plea had been advanced because the claim is with reference to the share of loss of a registered firm that is governed by the provisions of the Act which provisions are not overruled by the provisions of section 80 of the Act, the Assessing Officer and the CIT (A) were wrong in denying the carry forward of the share of loss.
(2.)Mr. Venkatesan, the learned counsel for the appellant submitted that the assessee had filed his return of income on 6th March, 1991 and he conceded that the said return was belated. He submitted that the assessee in this return of income had included his share of profits from the firm M/s. Dasappa & Sons at an amount of Rs. 8,63,803. He submitted that the Assessing Officer in his order of assessment had categorically observed that consequent to the conclusion of the assessment proceedings of the registered firm, of which the assessee is a partner, he is adopting the final figures in the hands of the partner. The Assessing Officer had further remarked that in the hands of the firm consequent upon the allowing of deductions under section 43B of the Act, the income as returned by the firm got converted to a loss and the share of loss of the assessee was Rs. 13,27,614. This loss he refused to be adjusted and carried forward, because, the return was not filed within the time permitted under the Act which being a condition precedent under section 80 of the Act. He contended that the CIT(A) had merely echoed the views of the Assessing Officer.
The learned counsel submitted that the Assessing Officer having determined the loss in pursuance of a return filed by an appellant, he is, bound to consider its carry forward and could not deny the appellant the benefit of carry forward of the loss. In support of this proposition he placed reliance on the jurisdictional High Court decision in Kareemsons (P.) Ltd. v. CIT [1992] 198 ITR 543/64 Taxman 200 (Kar.) (FB).

(3.)THE learned counsel contended that section 80 of the Act applies only to such allowing of carry forward of losses that are suffered by an assessee on his own and not to a situation of loss being thrust on him for carry, forward by the Act. He contended that Act had included special and exclusive provisions indicating the manner of carry forward of losses of a registered firm and an unregistered firm treated as a registered firm. THEse special provisions on loss of a registered firm state that the loss shall be apportioned between the partners for being set off against other income of the partners. He pleaded that it is further provided that in the event of the other income of the partners not being sufficient to absorb the loss the remaining unabsorbed loss would be brought back to the assessment of the firm for being adjusted against its income. He accordingly pleaded that the authorities were not justified in not allowing carry, forward of loss in the hands of the partners.