2018 (4) TMI 1606 - HC - Income Tax

MAT - levy of interest u/s 234B and 234C in the computation u/s 115JA where, the credit for advance tax is given in the regular assessment - Held that - As decided in JTC. IT., MUMBAI VERSUS M/S ROLTA INDIA LTD. 2011 (1) TMI 5 - SUPREME COURT OF INDIA Section 115JB is a self-contained code pertaining to MAT, which imposed liability for payment of advance tax on MAT companies and, therefore, where such companies defaulted in payment of advance tax in respect of tax payable under Section 115JB, it was liable to pay interest under Sections 234B and 234C of the Act. Interest under Sections 234B and 234C shall be payable on failure to pay advance tax in respect of tax payable under Section 115JA/115JB. For the aforestated reasons, Circular No. 13/2001 dated 9.11.2001 issued by CBDT has no application. - decided against assessee.

Summary

Issues:
Levy of interest under Section 115JA in the context of Section 219

Analysis:

1. Substantial Question of Law:
The primary issue in this case revolves around whether the Tribunal was justified in upholding the levy of interest in the computation under Section 115JA, concerning Section 219, where credit for advance tax is provided in the regular assessment. This issue forms the crux of the appeal and sets the stage for the legal analysis.

2. Legal Precedent and Supreme Court Decision:
The legal issue at hand has been previously addressed by the Hon'ble Supreme Court in the case of Joint Commissioner of Income Tax Vs. Rolta India Ltd. The Supreme Court decision highlighted the interpretation of provisions related to Minimum Alternate Tax (MAT) companies, specifically focusing on the determination of profits and the liability to pay tax under Section 115J of the Income Tax Act. The judgment discussed conflicting views from various High Courts and ultimately concluded that interest under Sections 234B and 234C is applicable on failure to pay advance tax concerning tax payable under Section 115JA/115JB. This legal precedent forms the basis for the decision in the current appeal.

3. Application of Legal Precedent:
In light of the Supreme Court decision and the interpretation of the provisions related to MAT companies, the substantial question of law raised in the present appeal is answered in favor of the Revenue and against the assessee. The judgment emphasizes that interest under Section 234B and 234C of the Income Tax Act is payable in cases of failure to pay advance tax concerning tax payable under Section 115JA. This application of legal precedent forms the basis for dismissing the Tax Case Appeal in the current matter.

4. Conclusion:
The final decision of the Court results in the dismissal of the Tax Case Appeal, with no costs imposed. The judgment aligns with the legal interpretation provided by the Supreme Court regarding the levy of interest under Section 115JA in connection with Section 219. The decision underscores the importance of complying with advance tax payment obligations, particularly for MAT companies, as outlined in the relevant provisions of the Income Tax Act.