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The issue involves whether the Tribunal could direct the Appellate Assistant Commissioner to decide on the additional ground concerning the chargeability of interest under section 215 of the Income-tax Act, 1961. Summary: The judgment of the High Court of Allahabad, delivered by R. M. Sahai J., addressed the reference made by the Income-tax Appellate Tribunal regarding the Appellate Assistant Commissioner's decision on the chargeability of penal interest under section 215 of the Income-tax Act, 1961. The Appellate Assistant Commissioner initially did not consider the new ground raised by the assessee, stating that no appeal is provided against an order passed under section 215. However, the Tribunal accepted the contention, partially allowed the appeal, and directed the Appellate Assistant Commissioner to reconsider the chargeability of penal interest. Upon reviewing the relevant provisions of the Income-tax Act, the High Court emphasized that while orders under various sections are appealable, no appeal is provided against an order passed under section 215 for charging interest due to low estimate of advance tax. The court highlighted that the discretion to reduce or waive such interest lies with the Income-tax Officer, and the absence of a specific provision for appeal against section 215 orders precludes challenging interest levy indirectly through other appeal grounds. Citing a previous case, the court reiterated that the absence of a legislative provision for appeal against section 215 orders restricts the scope of challenging interest levy in appeals based on other grounds. Consequently, the court answered the referred question in the negative, favoring the Commissioner of Income-tax and ruling against the assessee's appeal on the chargeability of interest under section 215 of the Income-tax Act, 1961. In conclusion, the court directed the parties to bear their own costs in the case.
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