- (1.) The Tribunal, New Delhi, has referred the following question of law under Section 256(1) of the IT Act, 1961 (hereinafter referred to as 'the Act'), for opinion to this Court : "Whether, on facts and in the circumstances of the case, the Tribunal was justified in law in holding that the return signed by Mr. K.K. Varshney was a valid return as he acted as an agent of the assessee and also in further holding that the loss claimed therein should have been considered in correct perspective ?"
(2.) The reference relates to the asst. yr. 1979-80. Briefly stated the facts giving rise to the present case are as under: The respondent-assessee is a co-operative society. It is being assessed to income-tax in the status of AOP. It had filed return on 30th June, 1979, showing loss to Rs. 1,33,10,000 which was within the stipulated period under Sections 139(1) and 139(3) of the Act. The assessment was completed under Section 144 of the Act for non-compliance of notices under Sections 142(1) and 143(2) which was cancelled under Section 146 of the Act. After cancellation of assessment under Section 146 of the Act and before completion of fresh assessment, a revised return was filed on 14th Oct., 1985, showing a loss of Rs. 1,34,99,761. The fresh assessment was completed on 24th March, 1986 and in that assessment, the ITO computed the loss at Rs. 34,97,856. However, he refused to direct to carry forward the loss as the return originally filed on 30th June, 1979 was not a valid return because it was not signed by appropriate person as provided under Section 140. He however, allowed depreciation of Rs. 92,37,063 to carry forward as unabsorbed depreciation as per rules. Feeling aggrieved the respondent preferred appeal before the CIT(A) who did not accept the plea for carry forward of the losses. Still feeling aggrieved the respondent preferred second appeal before the Tribunal. The Tribunal after hearing the submission advanced by the parties and also taking into consideration the material and evidence on record had held that the return was signed by the agent and, therefore, it is valid return. Accordingly it directed for carry forward of the losses also. It may be mentioned here that the return which was filed on 30th June, 1979, was signed by Sri K.K. Varshney, accounts executive of the respondent-society. When asked to give proof that the principal officer (general manager) was not in a position to sign the return and the power had been given to him to sign the return in absence of the principal officer, it was submitted as follows : "On the last day of June 1979, the transfer order of the then principal officer, Sri D.N. Tripathi, PCS, was received from the State Government as per Radiogram No. 545/I/II-16/19/79, dt. 30th June, 1979 and he was relieved of his charge on 6th July, 1979. The principal officer was under transfer on the last day of June, 1979, when he was busy on out-door duty also. The principal officer was not available in the office and as such the return could not be signed by him under the facts detailed hereinabove and, therefore, the same was filed by the person concerned incharge as per normal practice existing with the mill society in the relevant period." There was no written authority given by the principal officer i.e., general manager to Sri K.K. Varshney for signing the return on his behalf.
(3.) Heard Sri Shambhu Chopra, learned standing counsel for the Revenue. No body appeared on behalf of the respondent-assessee.;