1983 (11) TMI 118 - AT - Income Tax

Summary

Issues:
1. Whether a subsequent payment made by the assessee can be considered as advance tax payment for the purpose of allowing interest under section 214 of the Income-tax Act, 1961.
2. Whether the payment made by the assessee of Rs. 6,93,000 qualifies as advance tax payment under section 209A.
3. Whether the failure to file a revised estimate of advance tax affects the qualification of the payment for interest under section 214.

Detailed Analysis:
1. The case involved an appeal by the revenue regarding the treatment of a subsequent payment of Rs. 6,93,000 made by the assessee on 15-3-1979 as advance tax payment for the assessment year 1979-80. The Commissioner (Appeals) had directed the ITO to treat this amount as advance tax payment for the purpose of allowing interest under section 214, citing decisions of Gujarat and Kerala High Courts. The revenue contended that the payment did not qualify as advance tax as it was not in accordance with the estimate filed under section 209A.

2. The crucial question was whether the payment of Rs. 6,93,000 could be considered as advance tax under section 209A. The tribunal analyzed the provisions of sections 207, 209A, and 214 of the Income-tax Act, emphasizing that advance tax must be paid in accordance with the estimate filed by the assessee. The tribunal noted that the payment was not in conformity with the estimate, and the assessee failed to file a revised estimate as required by law. Therefore, the tribunal held that the payment did not qualify as advance tax and, consequently, was not eligible for interest under section 214.

3. The tribunal further reasoned that the filing of a statement or estimate of advance tax was a condition precedent for payment of advance tax under section 209A. As no revised estimate was filed by the assessee, the tribunal concluded that the additional payment of Rs. 6,93,000 could not be considered as advance tax payment. The tribunal reiterated that the payment must be in accordance with the estimate to qualify as advance tax, and failure to adhere to this requirement rendered the payment ineligible for interest under section 214. The tribunal overturned the decision of the Commissioner (Appeals) and restored that of the ITO based on these findings.