2010 (11) TMI 1115 - AT - Income Tax

Summary

Issues Involved:
Identical issue of charging interest u/s 234B of the Income-tax Act, 1961 in assessment years 2000-03 and 2003-04.

Assessment Year 2000-03:
- The appeal arises from the order of the CIT(Appeals) dated 16-12-2009 based on the order passed u/s 154 of the Act.
- Interest u/s 234B was sought to be charged in the assessment year 2002-03, which was omitted in the original assessment order u/s 143(3) dated 20-03-2006.
- The charging of interest u/s 234B was due to the restriction of deduction u/s 80HHC as a result of setting off business loss against export incentives.
- The CIT(A) accepted the assessee's plea that the provision was introduced from 1-4-1992, which the assessee could not foresee at the time of filing the return.
- The CIT(A) followed the Tribunal's decision in deleting the interest charged u/s 234B, which was in favor of the assessee.
- The Revenue's appeal was dismissed as no other decision was brought against the Chennai Bench's decision.

Assessment Year 2003-04:
- The appeal is against the order of the CIT(Appeals) dated 16-12-2009 based on the order passed u/s 143(3) read with section 147 of the Act.
- The assessee challenged the re-opening and charging of interest u/s 234B in this assessment year.
- The charging of interest u/s 234B was also due to the restriction of deduction u/s 80HHC as a result of setting off business loss against export incentives.
- The CIT(A) directed the Assessing Officer not to charge interest u/s 234B following the Tribunal's order dated 21-08-2009, which was in favor of the assessee.
- The appeals of the Revenue were dismissed based on the Tribunal's decision and no contrary decision was presented.

Final Outcome:
Both appeals of the Revenue were dismissed based on the Tribunal's decision in favor of the assessee.