Law:

Section:

Section 139, read with sections 140 and 292B, of the Income-tax Act, 1961 - Return of income - Defective return - Whether Assessing Officer can make an assessment on an invalid return - Held, no - Whether provisions of section 292B authorize Assessing Officer to ignore defect of a substantive nature - Held, no - Whether where return of income filed by assessee was neither signed by her, nor was it verified in terms of mandate of section 140, it had a glaring inherent defect which could not be cured in spite of deeming effect of section 292B - Held, yes FACTS The Tribunal set aside the assessment of income made by the Assessing Officer holding that the return filed by the assessee was an invalid return as it was neither signed by the assessee, nor was it verified in terms of the mandate of section 140. On appeal, the revenue, relying upon the provisions of section 292B, contended that the defects in return filed by the assessee depicting mistakes or omissions of income, assessment, notice, summons or other proceedings, should be overlooked and need not to be given effect to and, therefore, the order passed by the Tribunal was liable to be set aside. HELD The procedure for the assessment under the Act is laid down in the provisions contained in Chapter XIV. [Para 1] A perusal of sub-section (9) of section 139 leaves no room for doubt, that in case of a defective return, the Assessing Officer is required to afford an opportunity to the assessee to rectify the defect. Having given the aforesaid opportunity to the assessee, if he/she fails to rectify the defect, the Assessing Officer is authorized to treat the return as an invalid return and to make the assessment, as if the assessee had failed to furnish any return. It is, therefore, apparent that the Assessing Officer cannot make an assessment on an invalid return. [Para 2] The provisions of section 292B do not authorize the Assessing Officer to ignore a defect of a substantive nature and it is, therefore, that the aforesaid provision categorically records that a return would not be treated as invalid, if the same 'in substance and effect is in conformity with or according to the intent and purpose of the Act'.…

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