- (1.) The petitioner-assessee has impugned the order dated 20.3.2003, passed by the Settlement Commission, Annexure P.1 whereby interest under section 234B of the Income Tax Act, 1961 (in short, "the Act") which was levied vide order dated 20.10.1999 has been enhanced.
(2.) Brief facts as narrated in the petition may be noticed. The petitioner-assessee is a partnership firm in Ludhiana. It derives income from job-work and also on account of manufacturing and trading of bicycle parts. On 7.8.1992, a search was conducted under section 132 of the Act and various documents and stock of the petitioner and its sister concern were seized. The petitioner approached the Settlement Commission. Vide order dated 28.1.1999, Annexure P.3, the Settlement Commission after considering the matter waived interest under section 234A of the Act. As regards levy of interest under section 234B of the Act, it was directed to be charged upto the date of filing of the return or upto the date of processing it under section 143(1)(a) or upto the date of order under section 143(3)/144 whichever comes last. With regard to levy of interest under section 234C of the Act, the Settlement Commission ordered it to be charged as per law. Thereafter, a rectification application was filed by the petitioner against the order of the Settlement Commission regarding period of charging interest under section 234B of the Act. Vide order dated 20.10.1999, the Settlement Commission directed that interest should be charged upto the date of processing of return under section 143(1) of the Act. On 24.2.2003, the CIT Ludhiana in view of Constitution Bench decision in CIT v. Anjuman Ghaswala, 2001 252 ITR 1 and decision in CIT v. Hindustan Bulk Carrier, 2003 259 ITR 449 wherein it had been held that interest under Section 234B of the Act was mandatory in nature and is to be charged upto the date of order under Section 245D (4) of the Act, filed a miscellaneous application before the Settlement Commission for rectification of order passed by it under section 245D (2) on 20.10.1999 requesting it to charge interest under section 234B upto the date of final order under section 245D(4) of the Act. The Settlement Commission while disposing of the application vide order dated 20.3.2003, Annexure P.1, directed that interest under Section 234B of the Act be charged strictly as per law and as per decision of the Supreme Court quoted above. Hence the present petition.
(3.) Learned counsel for the petitioner submitted that earlier the case was adjourned sine die to await the decision of the Hon'ble Supreme Court. He urged that in view of the latest pronouncement of the Constitution Bench of the Hon'ble Apex Court in Brij Lal and others v. Commissioner of Income Tax,2010 46 DTR 153 wherein reference has also been made to earlier judgment in Ghaswala's case , the order of the Settlement Commission is untenable.;