2001 (1) TMI 207 - AT - Income Tax

Summary

Issues:
1. Jurisdiction of Assessing Officer to pass order under section 143(1)(c)
2. Levy of interest under section 234B of the Act

Jurisdiction of Assessing Officer under section 143(1)(c):
The appeals involved two assessees who were partners in a firm and questioned the jurisdiction of the Assessing Officer to pass orders under section 143(1)(c) and the levy of interest under section 234B. The assessees contended that the Assessing Officer exceeded jurisdiction by sending an intimation under section 143(1)(c) after an amendment in 1992 omitted the words 'partner of a firm' and 'firm' from the provision. They argued that the intimation increasing their liability was void ab initio. However, the departmental representative argued that the 1992 amendment was procedural, granting the Assessing Officer the authority to send the intimation. The Tribunal analyzed the amendment's nature, noting it was consequential, applicable from 1-4-1993 for assessment year 1993-94 onwards, and did not restrict the Assessing Officer's powers for prior years. The Tribunal held that the Assessing Officer had the authority to issue intimation under section 143(1)(c) before 1993-94, rejecting the challenge to his jurisdiction.

Levy of interest under section 234B:
Regarding the levy of interest under section 234B, the assessees argued that interest should be calculated only up to the date of the intimation under section 143(1)(a), citing a Supreme Court judgment. The departmental representative supported the authorities' decision to calculate interest until the intimation under section 143(1)(c). The Tribunal considered the Supreme Court's judgment and opined that interest should be payable or chargeable from the first day of the relevant assessment year to the date of regular assessment. In this case, interest was to be calculated until the dates of the intimation under section 143(1)(a) sent to the assessees. The Tribunal directed the Assessing Officer to charge interest only up to specific dates for each assessee, thereby partially allowing the appeals.

In conclusion, the Tribunal upheld the Assessing Officer's jurisdiction to issue intimation under section 143(1)(c) before 1993-94, rejecting the challenge raised by the assessees. Additionally, the Tribunal directed the calculation of interest under section 234B only up to specific dates, in accordance with the Supreme Court's judgment, partially allowing the appeals.