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3.2 The learned Commissioner of Income tax (Appeals) I, Bangalore has erred in concluding that

(i) the revised return filed by the appellant is an invalid return;

(ii) loss as per the revised return cannot be carried forward since the same was not filed within the time limit prescribed under section 139(3) of the Act.

ITA No.427 & 429/Bang/2012 3.3 On facts and in the circumstances of the case and law applicable, the revised return was a valid return and the loss as per the revised return is eligible for carry forward and set off as per the provisions of Chapter VI of the Income tax Act, 1961.

27. The next aspect to be considered is with regard to the conclusion of the CIT(A) regarding the revised return of income declaring loss return being invalid. In this regard, the point to be kept in mind is that the original return of income was filed within the due date u/s. 139(1) of the Act and revised return of income declaring loss was filed on 24.03.2006. On an identical issue, this Tribunal in the A.Y. 2004-05 in assessee's own case in filed within time declaring positive income, then the revised return of income will replace the original return of income and be valid for all ITA No.427 & 429/Bang/2012 purposes. The Tribunal held that revised return of income filed within the time permitted u/s. 139(5) of the Act is valid. The following were the relevant observations:-

11. We have to interpret the provisions of any statute to make the same workable to the logical ends. As per the provisions of sub-sec.(5) to sec.139, in both the situations where the assessee has filed the return of positive income as well as return of loss at the first instance as per the time limit prescribed and subsequently, files the revised return then the revised return is treated as valid return. In the present case, as the assessee filed its original return declaring the positive income and hence, in our opinion, subsequent revised return is valid return also and the assesse is entitled to carry forward of 'long-term capital loss'. Sub-sections (1) and (3) of sec.139 provides for the different situations and in our opinion, there is no conflict in applicability of both the provisions as both the provisions are applicable in the different situations. We are, therefore, of the opinion that there is no justification to deny the assessee to carry forward the loss.

ITA No.427 & 429/Bang/2012 We, accordingly, direct the A.O. to allow the assessee to carry forward the loss."

29. In view of the law as laid down in the decisions referred to above, we are of the view that the revised return of income is valid and the assessee is entitled to the benefit of carry forward of loss declared in the revised return of income. We order and hold accordingly. Ground Nos.3.1 to 3.3 are allowed.

30. What now remains for consideration is grounds 5 to 8 of the revenue's appeal, which reads as follows:-