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TMI Blog1983 (8) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... his omission to be a mistake apparent from the record, the ITO issued a show cause notice under s. 154 to the assessee. The assessee responded to the show cause notice and pleaded before the ITO that, since no interest under s. 139 was charged in the original assessment, the interest was waived. It was thus contended that, there being no rectifiable mistake, the proceedings initiated under s. 154 may be dropped. The ITO after considering the submissions made on behalf of the assessee, held that the omission regarding charging of interest was an apparent mistake, and so, the rectified the assessment order charging interest under s. 139 (8) from 1st Aug., 1977 to 27th July, 1978 i.e., for a period of 11 months at the rate of 12 per cent on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in. Is was submitted that in view of the provision of r. 117A, in order to get the interest waived, the assessee was required to submit an application and adduce evidence to the satisfaction of the ITO that he was prevented by sufficient cause from furnishing the return within time. As this was not done by the assessee, it cannot be said that the matter was agitated before the ITO or was considered by him. It was further pointed out that if the provisions of r. 117A are invoked by the ITO in a particular case, he has to pass a speaking order giving reasons for allowing or rejecting a claim for reduction or waiver of interest payable under s. 139. The original assessment, it was pointed out, is conspicuously silent on the point, and so the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the conclusion that it was open to the ITO to invoke the previsions of s. 154 for rectifying the mistake. 7. As has been rightly pointed out by the Departmental Represenative the order passed by the ITO under/s. 117A for reducing or waiving the interest payable under/r. 139, has to be a speaking order as the ITO is empowered to reduce or waive interest only in the cases and in the circumstances mentioned in this rule. The assessee s case could, at the most, fall within cl. (v) of r. 117A, which lays down that the ITO may reduce or waive the interest in any case in which the assessee produces evidence to the satisfaction of the ITO that he was prevented by sufficient cause from furnishing the return within time, provided that the previous ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere was no question of charging interest under/s. 139(8). We have perused this order a copy of which has been placed before us. We find that in that case the attention of the Tribunal was not drawn to Explain. (2) to s. 139 (8) and this led the Tribunal to hold that as the tax due was nil, no interest under s. 139 (8) was chargeable against the assessee. Explanation (2) which was brought on the statute book by the Finance Act. 1972 w.e.f. 1st April, 1972 provides inter alia, that for the purposes of sub-s. (8), where the assessee is a registered firm or an unregistered firm within has been assessee under cl. (b) of s. 183, the tax payable on the total income shall be the amount of tax which would have been payable if the firm had been asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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