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Interpretation of sub-sections (6), (8), and (9) of section 18A of the Indian Income-tax Act regarding the chargeability of interest for failure to submit an income estimate and pay tax. Analysis: The judgment revolves around the interpretation of the provisions of section 18A of the Income-tax Act, specifically focusing on the payment of income tax in advance. The court outlined the obligation of both old and new assessees to estimate and pay advance tax, emphasizing the principle of "pay as you earn." The court highlighted that under sub-sections (6) to (8), an assessee may be liable to pay interest in certain circumstances, while sub-section (9) deals with penalties. The court clarified that interest is calculated during regular assessment proceedings, and failure to pay advance tax as required falls under sub-section (8), leading to interest liability. The judgment also addressed the argument raised by the assessee regarding the applicability of penalties under sub-section (9)(b) due to non-payment of advance tax without sending estimates. The court rejected this argument, stating that sub-section (8) applies when no advance tax is paid, and failure to comply with sub-section (3) triggers both interest under sub-section (8) and penalties under sub-section (9), subject to certain conditions. The court further explained that before imposing penalties under sub-section (9)(b), the Income-tax Officer must ascertain that the failure was without reasonable cause. The judgment emphasized that even if non-payment of advance tax is due to accident or miscalculation, interest under sub-section (8) is applicable. The court justified the imposition of heavier penalties for deliberate defaults, highlighting that the legislation allows for such distinctions. Additionally, the court addressed the argument that sub-section (8) does not apply when no tax is paid, dismissing it by stating that if no advance tax is paid, interest is payable on the entire tax amount as per the provisions of sub-section (6). In conclusion, the court answered the referred question in the affirmative, confirming the chargeability of interest under sub-section (8) for failure to submit income estimates and pay tax. The judgment left the parties to bear their own costs for the reference, providing a comprehensive analysis of the interpretation and application of the relevant provisions of the Income-tax Act in the case at hand.
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