The officer's order under s.139(9) says your return is invalid and that you are not entitled to carry forward the loss. Can he decide that in a s.139(9) order?
No. The Tribunal held that an order under s.139(9) can be made only to determine whether there was a defect in the return and whether it was rectified. An officer who goes on to rule on entitlement to carry forward the loss has made an assessment order, with the consequence that it is appealable. On the facts the Tribunal also held that the acknowledgement sheet is not part of the return prescribed under Rule 12, and that a signature defect, once removed, relates back to the date the return was originally filed.
Decided by the ITAT (R.P. Garg, Vice President) on 2002-01-31, reported as [2002] 82 ITD 798 (Kol), assessment year 1996-97. The appeal number is not printed on the copy read.. It bears on section 139(9), section 139(3), section 80, section 143(1)(a), section 140, section Rule 12 of the Income Tax Act 1961, in Assessment & Scrutiny, Appeals and How Tax Law Is Read matters.
Two things a practitioner needs. First, the scope of a s.139(9) order is narrow, and a determination on carry-forward smuggled into it is an assessment that can be appealed rather than a decision to be met only by writ. Second, the relation-back proposition is stated here in terms, which is what preserves a s.139(3) loss return filed in time but cured late.
Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere.
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The assessee company filed its return for assessment year 1996-97 on 30 November 1996 showing a loss of Rs. 7,22,91,000. The return itself was signed by the managing director, but the acknowledgement sheet was signed by the Manager of Taxation. The Assessing Officer first processed the return under s.143(1)(a), then treated it as defective and gave the assessee fifteen days to rectify. A fresh acknowledgement sheet and return were filed on 4 December 1998. The Assessing Officer then made an order under s.139(9) treating the return as invalid on the footing that the defect had not been rectified as the statute required, and stating that the assessee was not entitled to carry forward the loss. The Commissioner (Appeals) decided against the department, which appealed.
The department's appeal was dismissed and the order of the Commissioner (Appeals) upheld. An order under s.139(9) can be made only to determine whether there was a defect in the return and whether it was rectified (para 8); by ruling on entitlement to carry forward the loss the officer had made an assessment order, which carried the right of appeal. The acknowledgement sheet is not part of the return prescribed under Rule 12 and serves an administrative purpose. Even assuming it were part of the return, the signature was a curable defect, and when a defect is removed it relates back to the date of the original action and has effect from the date the return was originally filed (para 17).
The Tribunal separated the question the section allows the officer to decide from the question he had in fact decided. Section 139(9) is machinery for identifying a defect and seeing whether it has been made good; it is not a vehicle for determining what the assessee is entitled to. A determination on carry-forward is an assessment, and characterising it as a s.139(9) order does not deprive the assessee of an appeal. On the acknowledgement sheet, the Tribunal compared it with the return prescribed under Rule 12 and found the two serve different functions notwithstanding that both require an authorised signature. On curability, it applied the general principle, drawing on a decision of the Calcutta High Court, that an amendment allowed to a document takes effect from the date the document was originally filed.
When a defect is removed it relates back to the date of original date of action and has the effect from the date when the return was originally filed.
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Handle my notice → Ask a CA on WhatsAppNo. The Tribunal held that an order under s.139(9) can be made only to determine whether there was a defect in the return and whether it was rectified. An officer who goes on to rule on entitlement to carry forward the loss has made an assessment order, with the consequence that it is appealable. On the facts the Tribunal also held that the acknowledgement sheet is not part of the return prescribed under Rule 12, and that a signature defect, once removed, relates back to the date the return was originally filed. This was decided by the ITAT (R.P. Garg, Vice President) and bears on section 139(9), section 139(3), section 80, section 143(1)(a), section 140, section Rule 12 of the Income Tax Act 1961. It is reported as [2002] 82 ITD 798 (Kol), assessment year 1996-97. The appeal number is not printed on the copy read.. Two things a practitioner needs. First, the scope of a s.139(9) order is narrow, and a determination on carry-forward smuggled into it is an assessment that can be appealed rather than a decision to be met only by writ. Second, the relation-back proposition is stated here in terms, which is what preserves a s.139(3) loss return filed in time but cured late. If it applies to you, the first step is this: Read the officer's s.139(9) order for what it actually decides; if it rules on carry-forward or on any entitlement, treat it as an assessment order and file an appeal.
The assessee company filed its return for assessment year 1996-97 on 30 November 1996 showing a loss of Rs. 7,22,91,000. The return itself was signed by the managing director, but the acknowledgement sheet was signed by the Manager of Taxation. The Assessing Officer first processed the return under s.143(1)(a), then treated it as defective and gave the assessee fifteen days to rectify. A fresh acknowledgement sheet and return were filed on 4 December 1998. The Assessing Officer then made an order under s.139(9) treating the return as invalid on the footing that the defect had not been rectified as the statute required, and stating that the assessee was not entitled to carry forward the loss. The Commissioner (Appeals) decided against the department, which appealed. The matter was decided on 2002-01-31 by the ITAT (R.P. Garg, Vice President). On those facts the ITAT held as follows. The department's appeal was dismissed and the order of the Commissioner (Appeals) upheld. An order under s.139(9) can be made only to determine whether there was a defect in the return and whether it was rectified (para 8); by ruling on entitlement to carry forward the loss the officer had made an assessment order, which carried the right of appeal. The acknowledgement sheet is not part of the return prescribed under Rule 12 and serves an administrative purpose. Even assuming it were part of the return, the signature was a curable defect, and when a defect is removed it relates back to the date of the original action and has effect from the date the return was originally filed (para 17).
The Tribunal separated the question the section allows the officer to decide from the question he had in fact decided. Section 139(9) is machinery for identifying a defect and seeing whether it has been made good; it is not a vehicle for determining what the assessee is entitled to. A determination on carry-forward is an assessment, and characterising it as a s.139(9) order does not deprive the assessee of an appeal. On the acknowledgement sheet, the Tribunal compared it with the return prescribed under Rule 12 and found the two serve different functions notwithstanding that both require an authorised signature. On curability, it applied the general principle, drawing on a decision of the Calcutta High Court, that an amendment allowed to a document takes effect from the date the document was originally filed. In the words reproduced by the source cited on this page: "When a defect is removed it relates back to the date of original date of action and has the effect from the date when the return was originally filed."
It was decided by the ITAT on 2002-01-31 and is reported as [2002] 82 ITD 798 (Kol), assessment year 1996-97. The appeal number is not printed on the copy read.. Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere. A Tribunal decision binds the assessing officer and the Commissioner (Appeals) within that Tribunal's jurisdiction, and is persuasive before other benches. It is not binding on a High Court, and a contrary co-ordinate bench decision will be argued against you, so check whether the point has been taken the other way before you build a reply around it. On section 139(9), section 139(3), section 80, section 143(1)(a), section 140, section Rule 12, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. The department's appeal was dismissed and the order of the Commissioner (Appeals) upheld. An order under s.139(9) can be made only to determine whether there was a defect in the return and whether it was rectified (para 8); by ruling on entitlement to carry forward the loss the officer had made an assessment order, which carried the right of appeal. The acknowledgement sheet is not part of the return prescribed under Rule 12 and serves an administrative purpose. Even assuming it were part of the return, the signature was a curable defect, and when a defect is removed it relates back to the date of the original action and has effect from the date the return was originally filed (para 17). It arises in Assessment & Scrutiny, Appeals and How Tax Law Is Read matters, on section 139(9), section 139(3), section 80, section 143(1)(a), section 140, section Rule 12 of the Income Tax Act 1961, and was decided by R.P. Garg, Vice President. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Check whether the document said to be defective is part of the return prescribed by Rule 12; the acknowledgement sheet was held not to be. Where a loss return was filed within the s.139(3) time and the defect cured later, run relation back: the cure takes effect from the date the return was originally filed. Do not let the appeal go by on the footing that a s.139(9) order is not appealable; on this authority the label does not govern.
Searched for later treatment; none was found. That is not the same as a source affirming it. No later order applying, doubting or dissenting from this one was located on indiankanoon. The relation-back proposition it states is reached independently by the Mumbai Bench in ACIT v. Prime Securities Ltd. [2005] 95 ITD 249 (Mum) and by the Ahmedabad Bench in Aark Infosoft (ITA No. 681/Ahd/2023, 21 February 2024). No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The appeal number is not printed on the copy read; the reporter citation [2002] 82 ITD 798 (Kol) is. The order was made by a single Member sitting as Vice President. The Calcutta High Court decision relied on at para 17 for the effect of an amendment is not named in the passage read, so it is not recorded as followed. The order predates the substitution of s.143(1)(a) by the present processing provision; the point decided does not turn on that. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The department's appeal was dismissed and the order of the Commissioner (Appeals) upheld. An order under s.139(9) can be made only to determine whether there was a defect in the return and whether it was rectified (para 8); by ruling on entitlement to carry forward the loss the officer had made an assessment order, which carried the right of appeal. The acknowledgement sheet is not part of the return prescribed under Rule 12 and serves an administrative purpose. Even assuming it were part of the return, the signature was a curable defect, and when a defect is removed it relates back to the date of the original action and has effect from the date the return was originally filed (para 17).
TaxSphere, “JCIT v Tata Cummins Ltd”, https://taxnotice.vittsphere.com/caselaw/case/jcit-v-tata-cummins-139-9-order-cannot-decide-carry-forward/ (validity last checked 2026-09-17)
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