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Issues:
1. Maintainability of appeal against levy of interest under section 217(1A) of the Income-tax Act, 1961. 2. Liability to pay interest under section 217(1A) when estimate filing and advance tax payment were beyond specified time. Analysis: Issue 1: Maintainability of Appeal The case involved an appeal against the levy of interest under section 217(1A) of the Income-tax Act, 1961. The Appellate Assistant Commissioner initially found the appeal not maintainable but later considered the matter on merits and dismissed the appeal. The assessee then appealed to the Tribunal, which held that the appeal was maintainable based on a previous court decision. The High Court concurred with the Tribunal's decision on the maintainability of the appeal, citing the precedent set by the National Products case [1977] 108 ITR 935. Issue 2: Liability for Interest under Section 217(1A) Regarding the liability to pay interest under section 217(1A) when the estimate filing and advance tax payment were delayed, the Tribunal found in favor of the assessee. The Income-tax Officer had demanded interest due to a belated estimate filing, even though the tax was paid within the financial year. The Tribunal, relying on the decision in Bharat Textile Works v. ITO [1978] 114 ITR 28, concluded that the advance tax paid, although late, should be considered. The High Court agreed with the Tribunal, stating that if any tax or advance tax is paid before the specified date, it must be credited when calculating the interest amount. The Court emphasized that the tax paid before the specified date should be included in the interest calculation, as supported by the Gujarat High Court decision. In conclusion, the High Court upheld the Tribunal's decision, answering both questions in the affirmative and against the Revenue. The judgment clarified the interpretation of relevant sections of the Income-tax Act, ensuring that timely tax payments are considered in interest calculations under section 217(1A).
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