- (1.) THIS is a petition filed under Section 256 (2) of the Income-tax Act, 1961, by the Commissioner of Income-tax, for a direction to the Income-tax Appellate Tribunal to refer the question of law alongwith statement of the case to this Court. The following question of law is sought to be referred: "whether on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in deleting interest charged under Section 215 of the Income-tax Act, 1961, ignoring the fact that charging of interest is compensatory in nature and not a penal one. "
(2.) THE Tribunal vide its order dated September 2, 1992, (Annexure P-2), declined to refer the aforesaid question to this Court for adjudication, as no referable question of law arises in the facts of the case.
(3.) THE facts leading to the question aforesaid are brief. The assessee M/s. Gurkartar Steel (P) Ltd. , was supposed to pay advance income tax. While framing assessment, the Income-tax Officer vide order dated January 14, 1987, (Annexure P-3) held that advance income-tax was not paid and hence the assessee was liable to pay interest under Section 215 of the Act. An appeal was filed against the aforesaid assessment, which was disposed of on July 18, 1987, vide order Annexure P-4. Although the appeal was partly allowed, however, on the point of imposition of tax under Section 215 of the Act, it was observed that there existed reasonable ground for waiver of interest and since the assessee did not deny its liability, merely because of certain circumstances which had arisen after filing of the estimate of advance tax the liability arose, thus declining the relief in this respect. The assessee took up the case before the Appellate Tribunal, who vide order Annexure P-5 dated February 6, 1992, allowed the relief to the assessee, observing as under: "in para 5 of the impugned order, the learned first appellate authority has held the stand of the assessee to be reasonable but yet he has observed that, ". . . . . . this may be reasonable ground for waiver of interest but since the appellant does not deny its liability, merely because of certain circumstances which have raised after filing the estimate of advance-tax that liability has arisen but not foreseen by the appellant. " The reasoning of the learned first appellate authority as such seems to be that the assessee, does not deny its liability but this is not born out from the grounds of appeal taken by the assessee before the learned first appellate authority. The assessee has taken grounds on merits as also denied his liability of subjecting the assessee to charge of interest inasmuch as the assessee in ground No. 3 has specifically mentioned that,". . . . . . . has wrongly charged interest under Section 215. " In view of the facts stated in the order of the learned first appellate authority as also the contentions raised before us, we direct that no interest would be charged from the assessee under Section 215. ";