2011 (6) TMI 915 - HC - Income Tax

Summary

Issues involved: Appeal u/s 260-A of the Income Tax Act challenging the order of the Income Tax Appellate Tribunal regarding the chargeability of interest under sections 234B and 234C when total income is assessed under section 115J.

Summary:
1. The appellant-revenue challenged the Tribunal's order regarding the chargeability of interest under sections 234B and 234C when total income is assessed under section 115J for the Assessment Year 1990-91.
2. The substantial question of law formulated was whether interest under sections 234B and 234C is chargeable if total income is assessed to tax under section 115J, referencing the decision of the Supreme Court in Joint Commissioner of Income Tax v. Rolta India Limited.
3. The appellant's counsel referred to the Supreme Court decision, emphasizing that the Tribunal's decision contradicted the law laid down by the Court, and the respondent did not appear.
4. The Supreme Court's decision highlighted that sections 115J/115JA are special provisions for taxing zero-tax companies, and interest under section 234B applies to all companies, including those assessed under section 115J.
5. The Tribunal's decision to not charge interest under sections 234B and 234C due to assessment under section 115J was deemed incorrect based on the Supreme Court's ruling.
6. The Court ruled in favor of the revenue, quashing the Tribunal's order and stating that interest under sections 234B and 234C is chargeable even when total income is assessed under section 115J.
7. The appeal was allowed with no costs incurred.