INCOME TAX OFFICER Vs. SECUNDERABAD TIN INDUSTRIES

JUDGEMENT

(1.) THE Income -tax Officer, J.- Ward, Hyderabad has preferred this appeal against the order dated 8th April, 1975 passed by our learned brother ,Gangadhara Rao, J., allowing the Writ, Petn. No. 1464 of 1972 filed by the respondent.

(2.) THE facts relevant for purposes of this appeal are these: THE respondent was a firm originally constituted in 1961. It was registered under the Indian Income-tax Act, hereinafter referred to as the Act. On 31-3-66, one of the partners by name G. S. Naidu retired and a new partner A. S. Nandagopal was brought into the partnership. For the assessment year 1968-69, the return was filed, on 20-1-1971. THE respondent firm paid a sum of Rs. 4,720/- on 11-2-1971 on self assessment basis under s. 140-A of the Income-tax Act. THE assessment was completed on 20-5-1971 and the Income-tax Officer levied besides the tax a sum of Rs. 1,056/- as interest under S. 217 of the Act for failure to voluntarily file the provisional estimate. THE Income-tax Officer also levied an interest of Rs. 7,750/- under S. 139 91) (iii) of the Act for belated submission of the return of the income. THE petitioner having exhausted all the remedies under the Act eventually filed the writ petition. Before Gangadhara Rao, J. three contentions were advanced by the respondent which were as follows :-

(3.) SO far as the third contention is concerned, the learned Judge relying upon a judgment of the Supreme Court in Commr. of Income-tax. West Bengal v. Vegetable Products Ltd., , held that the Income-tax Officer was incorrect in levying an interest of Rs. 4,720/- on the total tax assessed by him. The Income-tax Officer ought to have deducted the amount of tax already paid by the assessee and ought to have levied interest only on the balance.