- (1.) BOTH the appeals arise out of a common judgment dated 4th March, 2003 passed by the 3rd member of the Income Tax Appellate Tribunal 'C' Bench, Kolkata dismissing the appeals preferred by the assessee. The assessee has come up in appeal. The assessment years in question were 1985 -86 and 1986 -87. The following questions were formulated at the time of admission of the appeals. ITA No. 162 OF 2003 "(i) Whether on the facts and in the circumstances of the case and on a correct interpretation of Sections 80 and 139 of the Income -tax Act, 1961, the Income Tax Appellate Tribunal 'C Bench, Kolkata misdirected itself in law in confirming that the Assessee Company was not entitled to carry forward and set off the business loss of Rs. 103,17,30,191/ - determined and assessed by the learned Assessing Officer in its case vide his order dated 24th October, 1997 passed in respect of the assessment year 1985 -86? (ii) Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the provisions contained in Section 80 of the Income -tax Act, 1961 are substantive in nature? (iii) Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that there was no restriction in section 24(2) of the 1922 Act corresponding to the restrictions placed under section 80 of the 1961 Act for carry forward and set off of losses and that the decision of the Hon'ble Supreme Court was therefore distinguishable and not applicable to the instant case in the case of CIT v. Kullu Valley Transport Co. (P.) Ltd. : [1970] 77 ITR 518 (SC) - ITA No. 163 OF 2003 "(i) Whether on the facts and in the circumstances of the case and on a correct interpretation of Sections 80 and 139 of the Income -tax Act, 1961, the Income Tax Appellate Tribunal 'C' Bench, Kolkata misdirected itself in law in confirming that the Assessee Company was not entitled to carry forward and set off the business loss of Rs. 76,46,98,933/ - determined and assessed by the learned Assessing Officer in its case vide his order dated 24th October, 1997 passed in respect of the assessment year 1986 -87? (ii) Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the provisions contained in Section 80 of the Income -tax Act, 1961 are substantive in nature? (iii) Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that there was no restriction in section 24(2) of the 1922 Act corresponding to the restrictions placed under section 80 of the 1961 Act for carry forward and set off of losses and that the decision of the Hon'ble Supreme Court was therefore distinguishable and not applicable to the instant case in the case of CIT v. Kullu Valley Transport Co. Pvt. Ltd. : [1970] 77 ITR 518 (SC) - We have heard the learned counsel appearing for the parties. We are inclined to uphold the order under challenge. Therefore, elaborate discussion is not required. The learned Tribunal has in the impugned judgment and order ably discussed all the points involved in the appeals. The brief facts necessary for disposal of the appeals are as follows:
(2.) THE return for the assessment year 1985 -86 was filed by the assessee on 14th October, 1985 declaring an income of Rs. 5,14,82,950/ -. The return for the assessment year 1986 -87 was filed by the assessee on 30th October, 1987 declaring an income of Rs. 3,93,67,310/ -. Both the returns were filed after expiry of the time extended by the Assessing Officer for filing of return. In the case of assessment year 1985 -86 time was granted till 30th September, 1985, while the return was filed on 14th October, 1985, whereas in the case of assessment year 1986 -87 time was twice extended and the last of such extended time expired on 31st March, 1987, whereas the return was filed on 30th October, 1987. The assessment for the assessment year 1985 -86 after the matter had travelled upto the learned Tribunal and after the matter had reached finality, was assessed at a net loss of Rs. 103,17,30,191/ -. Similarly, for the assessment year 1986 -87, the loss was assessed at Rs. 76,46,98,933/ -. Question arose whether the assessee was entitled to the benefit of carrying forward the losses. That question has been answered in the negative. It is this issue which is to be determined by us in the present appeal for both the assessment years indicated above.
(3.) MR . Bagchi, learned counsel appearing for the appellant/assessee submitted that the judgment of the Apex Court in the case of CIT v. Kullu Valley Transport Co. (P.) Ltd. : [1970] 77 ITR 518 still holds the field wherein it was held by majority view that "Section 22(2A) simply says that in order to get the benefit of section 24(2), the assessee must submit his loss return within the time specified by section 22(1). That provision must be read with section 22(3) for the purpose of determining the time within which a return has to be submitted. It can well be said that section 22(3) is merely a proviso to section 22(1). Thus, a return submitted at any time before assessment is made is a valid return. In considering whether a return made is within time sub -section (1) of section 22 must be read along with sub -section (3) of that section. A return whether it is a return of income, profits or gains or of loss must be considered as having been made within the time prescribed if it is made within the time specified in section 22(3). In other words, if section 22(3) is complied with section 22(1) must also be held to have been complied with. If compliance has been made with the latter provision, the requirements of section 22(2A) would stand satisfied".;