District Co-Op. Bank Ltd., got its accounts audited for the A.Y.2004-05 with in time, but filed the return of loss. There was delay of two days in filing the return. The assessee claimed carry forward of loss in the subsequent year. Assessments for the A.Y. 2005-06 and 2006-07 were completed u/s 143(3) of the Act. In the A.Y.assessee had income and after setoff earlier year loss there was no positive income, which was accepted by A.O. The A.O later intiated proceedings u/s 154 of the Act, on the ground that loss of A.Y.2004-05 is not eligible to be setoff as the return was not filed as required u/s 139(3) of the Act and has passed as order u/s 54 of the Act disaalowing the loss of A.Y.2004-05. Whether A.O.can resort to such an action u/s 154 of the Act.
