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Issues:
1. Entitlement to interest under section 214 of the Income-tax Act, 1961 based on voluntary advance tax payment. Analysis: The judgment by the Appellate Tribunal ITAT MADRAS-B involved an appeal by the assessee against the Commissioner's order under section 263, challenging the allowance of interest amounting to Rs. 12,350 in the original assessment. The issue revolved around whether the assessee, an old assessee, was entitled to interest under section 214 for a payment treated as advance tax by the Income Tax Officer (ITO). The Commissioner held that the assessee's voluntary estimate of tax payment could not be considered advance tax under sections 207 to 213 of the Act. The Tribunal considered the provisions of sections 207 to 219, emphasizing that an old assessee is required to file an advance tax estimate only if served with an order under section 210 by the ITO. In this case, as the assessee had not received such an order, the voluntary estimate and payment made by the assessee were deemed as an ordinary deposit, not advance tax. Consequently, the Tribunal agreed with the Commissioner that the assessee was not entitled to interest under section 214 on the voluntary payment labeled as advance tax. The Tribunal's decision was based on a meticulous analysis of the relevant sections of the Income-tax Act, particularly sections 207, 210, and 212. It highlighted that an old assessee is absolved from filing an advance tax estimate voluntarily unless specifically ordered by the ITO under section 210. The judgment clarified that the provisions of sections 212(1) and 212(3A) apply to cases where the ITO has issued an order for advance tax payment to an old assessee. Since the assessee in this case had not been served with such an order, the voluntary estimate and payment were not considered advance tax under the statutory framework. The Tribunal underscored that section 214 mandates interest payment by the Central Government on the excess of aggregate advance tax paid over the tax determined on regular assessment. As the so-called advance tax paid by the assessee did not fall under the purview of sections 207 to 213 due to the absence of a formal order from the ITO, it was categorized as an ordinary deposit, leading to the denial of interest under section 214. In conclusion, the Tribunal dismissed the assessee's appeal, upholding the Commissioner's decision to withdraw the interest granted under section 214 for the voluntary tax payment treated as advance tax. The judgment elucidated the distinction between advance tax payments made voluntarily by old assessees and those mandated by formal orders from the tax authorities, emphasizing the statutory requirements for claiming interest under section 214 of the Income-tax Act, 1961.
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