2013 (2) TMI 427 - HC - Income Tax

Reduction or waiver of Interest - Assessee challenges order refusing for waiver under Section 220 (2A) - Assessee contended that his case is fit for consideration under Section 220 (2A). Held that - Second application of assessee was also rejected for non-co-operation evidenced by default in making payment - It was after two unsuccessful attempts that the assessee again approached the CIT which was again rejected on the ground of non co-operation - Power conferred under Section 220 (2A) is not a power which could be invoked in a recurring manner on every change in circumstance The first application having been considered by the competent authority and rejected; there was no scope for any further application for the very same relief No waiver allowed Against the assessee.

Summary

Issues:
Challenge to Ext.P6 order invoking powers under Section 220 (2A) of the Income Tax Act for waiver of interest levied, satisfaction of conditions under Section 220 (2A), rejection of petitioner's applications by Commissioner and Chief Commissioner based on non-cooperation and default in payment.

Analysis:

The petitioner challenged Ext.P6 order which refused to invoke powers under Section 220 (2A) of the Income Tax Act for waiver of interest levied. The petitioner, a stock broker, did not file returns for the years 1990-91 and 1991-92, claiming insufficient income. For the assessment year 1992-93, returns were filed without necessary annexures. The department issued notices under Section 148 for the years with no returns and completed assessments under Section 144 due to non-cooperation. The petitioner sought only waiver of interest under Section 220, claiming genuine hardship, non-attribution of delay to the assessee, and cooperation in recovery proceedings. The petitioner contended that the case satisfied all three conditions under Section 220 (2A).

The petitioner's first application invoking Section 220 (2A) was rejected by the Commissioner for non-payment of demanded amounts, indicating lack of cooperation in tax recovery proceedings. The petitioner argued that subsequent applications were made after payment, expecting favorable consideration. However, the Chief Commissioner rejected the second application citing non-cooperation due to default in payment. The High Court noted that the power under Section 220 (2A) cannot be repeatedly invoked based on changing circumstances. The Court deemed the subsequent applications as incompetent, as the initial rejection by the competent authority should have precluded further applications for the same relief.

The High Court emphasized that once the Commissioner exercised discretion and found a condition under Section 220 (2A) unsatisfied, the Court should not interfere, especially when non-cooperation was linked to default in payment. The Court concluded that the writ petition lacked merit and dismissed it, highlighting the importance of complying with conditions under Section 220 (2A) for invoking waiver powers effectively.

In summary, the judgment underscores the significance of meeting the conditions under Section 220 (2A) of the Income Tax Act for seeking waiver of interest levied. It highlights the need for cooperation in tax recovery proceedings and cautions against repetitive applications for relief under the same provision. The decision reaffirms the authority's discretion in assessing compliance with statutory requirements and discourages interference by the Court in such matters, especially when non-cooperation is tied to default in payment.