9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2010 (7) TMI 205 - HC - Income TaxSearch and seizure - Search and seizure operation were carried out at the premises of the assessee. Notice dated August 21 1997 under section 158BC of Act wasserved upon the assessee on Aug. 22 1997 calling for a return for the block period. Before the expiry of the 45 days period for filing of return the assessee requested the department to supply certain document seized by the department during the search as it was not possible for the assessee to file the return in the absence of these documents. The department supplied these documents on November 20 1998 and the return was filed on 1st January. The Assessing Officer charged interest u/s 158BFA of the Act. Commissioner (Appeals) dismissed the appeal. Tribunal deletes the interest. Held that - the Tribunal was wrong in counting he period of 45 days as required under the law for filing the return only from November 20 1998 and absolving the assessee from liability to pay any interest. From the total time taken by the assessee from the date of service of notice under section 158BC of the Act till the filing of the return the time taken by Department to supply the documents had to be excluded. If the period exceeded 45 days the assessee would be liable to pay the interest for the period beyond 45 days.
Issues:
Levy of interest under section 158BFA(1) of the Income-tax Act, 1961. Analysis: 1. The case involved a dispute regarding the levy of interest under section 158BFA(1) of the Income-tax Act, 1961. The issue arose from a search and seizure operation conducted at the premises of the assessee, leading to the necessity of filing a revised income tax return within a specified period after receiving a notice under section 158BC of the Act. Failure to file the return within the prescribed time could result in the imposition of interest under section 158BFA(1). 2. The Assessing Officer charged interest and initiated penalty under section 158BFA of the Act due to a delay in filing the return by the assessee. However, the Income-tax Appellate Tribunal (the Tribunal) allowed the appeal filed by the assessee, holding that no interest could be levied in the circumstances of the case. The Tribunal emphasized that the delay in filing the return was not attributable to the assessee, as the necessary documents were supplied by the Department after a significant delay. 3. The Tribunal's decision was based on a detailed analysis of the provisions of section 158BFA(1) and the facts of the case. It highlighted that the language of the statute was clear and unambiguous, mandating the charging of interest if the delay in filing the return was attributable to the assessee. The Tribunal also referred to a previous decision to support its interpretation of the law. 4. The Revenue contended that the assessee's delay in requesting the documents after the search operation and the subsequent delay in filing the return justified the imposition of interest under section 158BFA(1). However, the Tribunal found that the delay in obtaining the necessary documents was primarily due to the Department's actions, absolving the assessee of liability for the interest. 5. The High Court analyzed the arguments presented by both parties and concluded that neither the Assessing Officer nor the Tribunal had taken a justified approach. It noted that both the assessee and the Revenue were responsible for delays in the process. Therefore, the Court determined that the total time taken by the assessee to file the return should be considered, excluding the period consumed by the Department in supplying the documents. If the filing period exceeded 45 days, the assessee would be liable to pay interest for the period beyond the prescribed time. 6. Ultimately, the Court held that the Tribunal's decision was not entirely correct in dealing with the levy of interest under section 158BFA(1). Instead, the Court outlined a method to calculate the period for which the interest liability should be imposed on the assessee, taking into account the delays caused by both parties involved in the process.
|
