Losses not claimed in original Return, cannot be claimed by filing revised return

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IN THE ITAT BANGALORE BENCH ‘A’

Karnataka Forest Development Corp. Ltd.

v.

Commissioner of Income-tax

I T APPEAL NO. 81(BANG.) OF 2011

[ASSESSMENT YEAR 2004-05]

MARCH 30, 2012

Undisputedly, the assessee has filed original return under sub-section (1) of section 139. In the said return of income, the assessee has not claimed the loss. Sub-section (5) provides that where the assessee discovers any omission or a wrong statement, then he can file a revised return. Where the wrong statement or omission results in the claim of loss, when the return filed under section 139(5) is to be considered or not, is to be now seen. Whether omission of such a claim of loss in the original return of income is bona fide or not is also to be seen. From the revised return of income, it is noticed that the assessee has not only claimed the loss of the relevant assessment year, i.e., 2004-05 to be carried forward but has also claimed the loss of the assessment year 2003-04 to be carried forward. Thus, it is to be presumed that the assessee was having the knowledge of the loss for the assessment year 2003-04 which was to be carried forward and claimed in the assessment year 2004-05. Therefore, when it filed the return under section 139(1), it should have taken this loss into consideration and should have filed the return under section 139(3). Having filed the original return of income under section 139(1), the assessee cannot later on file the revised return of income claiming the loss on the ground that it was discovered subsequently. This argument of the assessee is not acceptable. In view of the same, the findings of the Commissioner (Appeals) were to be agreed with that when the assessee was claiming the loss for the relevant assessment year and also claiming the loss to be carried forward of the loss of 2003-04 and 2004-05, respectively, then the assessee was required to file the return under section 139(3) and, therefore, the revised return filed under section 139(5) could not be accepted and had to be treated as null and void.