1979 (7) TMI 23 - HC - Income Tax

Summary

Issues Involved:
1. Appealability of the Income-tax Officer's order dated July 20, 1971, regarding refusal to grant interest u/s 214.
2. Entitlement of interest u/s 214 up to the date of regular assessment, i.e., November 26, 1970.

Summary:

Issue 1: Appealability of the Income-tax Officer's order dated July 20, 1971, regarding refusal to grant interest u/s 214.

The Tribunal held that the order of the Income-tax Officer (ITO) dated July 20, 1971, concerning the refusal to grant interest u/s 214, is not appealable. The assessee's appeal to the Appellate Assistant Commissioner (AAC) against this order was deemed incompetent. The court examined the nature of the ITO's order and concluded that it was not a "regular assessment" order but rather an order passed to give effect to the AAC's earlier order. The court referenced decisions from the Calcutta High Court in Kooka Sidhwa and Co. v. CIT and the Punjab High Court in Gopi Lal v. CIT, which supported the view that such orders are not appealable. The appropriate remedy for the assessee was to seek revision u/s 264 of the Income-tax Act, not an appeal to the AAC.

Issue 2: Entitlement of interest u/s 214 up to the date of regular assessment, i.e., November 26, 1970.

The court did not provide an answer to the second question, as it was rendered moot by the determination of the first issue. The Tribunal's decision that the assessee was not entitled to interest beyond the date of the regular assessment (November 26, 1970) was not addressed further. The court noted that the Commissioner should consider the merits of the case if the assessee files a revision petition within one month from the date of the judgment. The observations made by the Tribunal would not bind the Commissioner or the assessee, and the Commissioner would be free to dispose of the revision petition in accordance with the law.

Conclusion:

The court affirmed that the order of the ITO dated July 20, 1971, regarding the refusal to grant interest u/s 214, is not appealable. The second question regarding the entitlement of interest u/s 214 up to the date of regular assessment was returned unanswered. The appropriate remedy for the assessee is to file a revision petition u/s 264, and the Commissioner is advised to condone the delay if the petition is filed within one month.