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TMI Blog1990 (10) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... es Manganese Ore Co. Ltd. v. CIT [1986] 160 ITR 961/27 Taxman 275 had wither considered nor overruled the Allahabad High Court decision cited supra. It was, therefore, strongly contended that the learned CIT (Appeals) had exceeded his jurisdiction in admitting appeal with regard to the charging of interest under the aforesaid sections. 4. Shri C.S. Aggarwal, the learned counsel for the assessee, on the other hand, submitted that the assessee denied its liability to be assessed to interest and, as such, the appeal was competent before the learned CIT (Appeals) with regard to the charging of interest. He relied on the decision of the Supreme Court in the case of Central Provinces Manganese Ore Co. Ltd. 5. We have carefully considered the rival submissions as also the facts on record. If the matter is concluded by the judgment of the Jurisdictional High Court which is not modified or over ruled expressly or impliedly by the Hon' ble Supreme Court, we are duty-bound to bow before the Hon'ble Allahabad High Court. In the case of Geeta Ram Kali Ram the observations of the Allahabad High Court are As under :--- " In our opinion, the denial clause applies to a situation where the den ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve have been cited with approval by the Supreme Court it can be safely presumed that the decision of the Allahabad High Court in Geeta Ram Kali Ram's case, though not specifically considered by, the Supreme Court should be deemed to have been considered and overruled. We accordingly reject the ground of the Revenue with regard to the admissibility or otherwise of the appeal against the charging of interest under sections 139(8) and 215/217. 6. The next submission of the learned Departmental Representative was that charging of interest under the aforesaid sections was mandatory and was not dependent upon the existence or otherwise of a reasonable cause. It was also submitted by the learned Departmental Representative that in fact there was no reasonable cause at all because the assessee had made a request for sale of gold and silver jewellery for payment of Advance-tax, which request was neither legal nor valid. The learned Departmental Representative also relied on the Tribunal's decision in ITO v.N. Saikrishna[1987] 22 ITD 548 (Hyd.). It was also submitted that the reference to the case of Addl. CIT v. Sohan Lal Dugar [1984] 18 Taxman 501 (Raj.) in the impugned order of the Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication to the assessing officer that the tax payable on the last instalment, i.e.,15-3-1985may be realised out of sale of seized jewellery and silver as the assessee was not left with any liquid cash after the search. No steps appear to have been taken by the assessing officer with regard to this request and at the time of regular assessment interest under sections 139(8) and 215/217 was charged. 9. As the assessee did not pay the last instalment of advance-tax interest under section 215/217 became chargeable. As the return of income was filed on23-3-1987as against the due date of31-7-1985interest under section 139(8) also became chargeable. Interest under the aforesaid sections was infact charged by the assessing officer. It has been held by the Supreme Court in the case of Central Provinces Manganese Ore Co. Ltd. that interest charged for the aforesaid defaults is levied by way of compensation and not by way of penalty. As the defaults have actually been committed by the assessee, interest under the aforesaid sections had to be charged in accordance with the provisions of law. 10. The learned counsel for the assessee has not pointed out any provision of law under which the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gold jewellery and silver ornaments seized by the Department were of the value of Rs. 1,81,691 plus Rs. 51,000 aggregating to Rs. 2,32,691. Interest under sections 139(8) and 215/217 actually charged in the case of the firm and the three partners whose cases are before us today was as under : -------------------------------------------------------------------------------------------------------------------------------------------------- Name of the assessee Interest u/s. Interest u/s. Total 139(8) 215/217 -------------------------------------------------------------------------------------------------------------------------------------------------- M/s. Raja Ram Santosh Kumar Rs. 22,088 Rs. 26,738 Rs. 48,826 Shri Raja Ram Rs. 22,420 Rs. 28,320 Rs. 50,740 Shri Santosh Kumar Rs. 14,421 Rs. 18,216 Rs. 32,637 Shri Radhey Shyam Rs. 5,586 Rs. 7,056 Rs. 12,642 ---------------------- Rs. 1,44,845 -------------------------------------------------------------------------------------------------------------------------------------------------- From the above it will be seen that on the basis of the assets seized the interest actually imposed under the aforesaid sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... towards advance-tax, but as stated above since the assessee's request would not have been put into any meaningful or practical shape before 31-3-1985, there was no question of adjusting the demand before that date. In that view of the matter any payment made beyond 31-3-1985 could not have assumed the character of advance-tax payment and, as such, interest under section 215/217 would have become payable. 15. The sum and substance of the entire discussion is that there may be a good and sufficient ground for reduction or waiver of interest under Rides 40 and 117A of the Income-tax Rules, 1962 or under section 264 of the Income-tax Act, but there certainly was no scope for getting any redressal of the grievance in appellate proceedings. The learned counsel for the assessee has relied on the Rajasthan High Court decision in Golecha Properties (P.) Ltd. in which it is held that there is neither principle nor authority to support the conclusion that the appellate authority cannot entertain the assessee's request for waiver or reduction of interest and exercise that power given in these statutory provisions. This conclusion, however, is contrary to the decision of the Supreme Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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