- (1.) WE have heard Shri R.K. Upadhyaya, Standing Counsel, Income Tax Department. Shri R.R. Agarwal appears for the Respondent -Assessee.
(2.) IN this Income Tax Appeal, the following question of law has been raised: Whether the Hon'ble Tribunal is correct in law in setting aside the impugned order of the learned CIT (Appeals) on the issue of charging of interest under Sections 234B and 234C of the IT Act, 1961 and in restoring the matter to the file of the Assessing Officer for affording an opportunity to the Assessee of being heard, especially in view of the contrary decision of the Hon'ble Supreme Court in the cases of Anjum M.H. Ghaswala : 252 ITR 1 (SC) and Sant Ram Mangat Ram Jewellers : 264 ITR 564 (SC) holding that charging interest under Sections 234A, 234B and 234C is mandatory and that these sections in clear terms imposed a mandate to collect interest at the specified rate. We have gone through the order of Income Tax Appellate Tribunal dated 21.11.2005, and do not find that the Tribunal has decided the question of charging of mandatory interest as determined under Section 234 -A, 234 -B and 234 -C of the Income Tax Act, 1961 to raise it in the grounds in appeal.
(3.) AS regards grounds Nos. 4, 5 and 6 relating to levy of interest under Section 234B and 234C, it was submitted by learned Counsel for Assessee, that the provision was made by the Assessee company in its books of account for bonus payable to the employees and the said amount was deductible on payment thereof to the employees on or before 30th November, 1996, being the due date for filing of the Income -tax return. The Assessee could not have anticipated that the said amount of bonus shall remain unpaid upto 30th November, 1996 and it was only because of the refusal of the employees to accept the said bonus that the same remained unpaid. The Tribunal thereafter observed: ...His contention, therefore, is that there was no default being committed by the Assessee company for which it was liable to pay interest under Section 234B and 234C and in the absence of any opportunity having been given by the Assessing Officer, the Assessee company could not put forth its case before him. Relying upon the decision of Delhi Special Bench of ITAT in the case of Motorola Inc. v. DCIT reported in 95 ITD 269, he has contended that the impugned order of the learned CIT (A) on this issue may be set aside and the matter be restored to the file of the Assessing Officer for providing such opportunity to the Assessee. The learned D.R. has not raised any objection to such request of the learned Counsel for the Assessee being acceded to by the Tribunal. We, therefore, set aside the impugned order of the Ld. CIT (A) on this issue and restore the matter to the file of the Assessing Officer for proper adjudication in accordance with law after affording an opportunity to the Assessee of being heard. Ground No. 4, 5 & 6 of the Assessee are treated s allowed for statistical purposes.;