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Issues:
1. Charging of interest under section 215 of the Income-tax Act, 1961 for assessment year 1977-78. Detailed Analysis: The judgment revolves around the controversy of whether the department was justified in charging interest under section 215 of the Income-tax Act, 1961 from the assessee for the assessment year 1977-78. The assessee, a company with a calendar year accounting period, received a notice of demand in the financial year 1976-77 for advance tax amounting to Rs. 7,59,290 for the assessment year 1977-78. The company declared 'nil' income and paid no tax based on an estimate filed in June 1976. However, upon assessment completion, the assessed tax was Rs. 12,49,561, leading to interest of Rs. 45,852 being charged by the Income Tax Officer (ITO) as the paid tax was less than 75% of the assessed tax. The assessee contended that it could not anticipate the income earned due to a government subsidy decision and, therefore, could not revise the advance tax estimate. The assessee cited a Gujarat High Court case to argue against interest charges. However, the Commissioner (Appeals) upheld the ITO's decision, emphasizing that section 215 mandates interest if the paid tax is less than 75% of the assessed tax, regardless of the reasonableness of the estimate. The Commissioner differentiated the case from the precedent cited by the assessee, concluding that interest was justified in this case. The Appellate Tribunal analyzed the provisions of section 215 and distinguished them from section 217, highlighting that section 215 deals with optional estimates while section 217 addresses mandatory filings. The Tribunal agreed with the Commissioner's interpretation, stating that interest is payable if the paid tax falls short of 75% of the assessed tax, irrespective of the estimate's accuracy. Therefore, the Tribunal upheld the Commissioner's decision, dismissing the assessee's appeal and affirming the interest charges under section 215 for the assessment year 1977-78.
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