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Issues Involved:
The appeal concerns interest levied u/s 234B and 234C on cash compensatory support (CCS) received by the assessee, which was initially treated as a capital receipt but later became taxable due to retrospective legislative amendments. Summary: The assessee appealed against the interest levied u/s 234B and 234C on CCS received, initially considered capital but later deemed taxable. The Assessing Officer and CIT (Appeals) upheld the interest charges, citing the clear provisions of law and the assessee's failure to pay advance tax. The assessee argued a bona fide belief based on precedents and timing of amendments. The Tribunal found in favor of the assessee, noting the Special Bench decision's availability at the time of non-payment of advance tax. The Tribunal referenced a High Court decision advising against injustice in such cases and highlighted CBDT instructions allowing waiver of penal interest in similar circumstances. Consequently, the Tribunal ruled that no interest u/s 234B or 234C should be charged, directing a recalculation by the Assessing Officer excluding the CCS amount. The appeal of the assessee was allowed.
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