KAILASH ASSOCIATES Vs. DEPUTY COMMISSIONER OF INCOME TAX
INCOME TAX APPELLATE TRIBUNAL
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Manzoor Ahmed Bakhshi, Judicial Member -
(1.) APPELLANT is an AOP. For assessment year 1991-92, Dy. Commissioner of Income-tax Special Range, Jammu completed the assessment under Section 143(3) of the Income tax Act, 1961, vide order dated 28-8-1991. Interest under Section 234B and under Section 234C was charged at Rs. 19,521 and Rs. 26,932 respectively. Assessee had filed an application under Section 154 on 3-10-1991 claiming that a sum of Rs. 2,21,822 had been paid as advance-tax on 28-1-1991 for which no credit had been given by the Assessing Officer. It was also pointed out that if the payment of Rs. 2,21,822 made on 28-1-1991 is taken into account then there is no shortfall in the payment of advance-tax for the purposes of Section 234B. The working was given as under :
(2.) It had further been brought to the notice of the Assessing Officer that if the payment of Rs. 2,21,822 made on 28-1 -1991 is taken into account, interest, under Section 234C would get reduced. The Assessing Officer vide impugned order accepted the plea of the assessee regarding the interest under Section 234B. With regard to the interest under Section 234C the Assessing Officer re-calculated the interest but did not accept the plea of the assessee that such interest was chargeable only up to the date of the default and not for a period of three months.
The assessee appealed to the CIT (Appeals), Jammu, who vide order dated 12-2-1992 dismissed the same by upholding the view of the Assessing Officer.
(3.) THE learned Counsel for the assessee cortended that interest under Section 234C was compensatory and was chargeable for the period of default @ 1.5% per month subject to maximum period of three months. THE Assessing Officer, according to the learned Counsel has wrongly levied interest for a period of three months when the default in respect of the 2nd instalment of advance-tax was only for a period of 44 days only. THE learned Counsel accordingly contended that the interest charged under Section 234C may be reduced.;
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