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TMI Blog2000 (8) TMI 260X X X X Extracts X X X X X X X X Extracts X X X X ..... interest levied under ss. 139(8) and 215. Hence aggrieved, the assessee has carried this matter in appeal before the Tribunal. 4. We have heard the arguments of both the sides and also perused the records. 5. The assessee has raised one common ground in all the above three appeals and the said ground disputes the charging of interest levied under ss. 139(8) and 215 of the IT Act in reassessments framed under s. 148. The learned authorized representative of assessee has contended that the interest under ss. 139(8) and 215, IT Act, 1961, cannot be charged in reassessment framed under s. 148 and that the said interests can be charged only in regular assessment which is framed under s. 143 or 144 of the IT Act. He has cited CIT vs. Mannalal Nirmal Kumar (1992) 106 CTR (Raj) 144 : (1992) 198 ITR 556 (Raj) and CIT vs. Khodey Brewing and Distilling Industries Ltd. (2000) 159 CTR (Kar) 354 : (2000) 243 ITR 836 (Kar). He has contended that in the regular assessments in the asst. yrs. 1986-87 and 1988-89, no interest under s. 139(8) nor under s. 215 was charged but in asst. yr. 1987-88, interest under s. 215 was charged though no interest under s. 139(8) was charged. He has contended tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment made under s. 147 can be treated as regular assessment only when first assessment is made thereunder, but the same does not apply in the instant cases inasmuch as the first assessments in all the above three assessment years had already been made. He has contended that in the circumstances the said amendment is not applicable to the assessee and that the judgment of Hon'ble Rajasthan High Court is very much applicable in the instant cases. 8. We have considered the rival contentions, the relevant material on record, as also the cited decisions. 9. First of all we take up the learned Departmental Representative's objection regarding the maintainability of the appeal. In (1987) 58 CTR (SC) 112 : (1986) 160 ITR 961 (SC) the Hon'ble Supreme Court has held that the matter of charging of interest under s. 139(8) or 215 is not appealable unless the assessee is not liable to levy of such interest at all. The Hon'ble Supreme Court approved the decision of Hon'ble Karnataka High Court in the case of National Products vs. CIT 1976 CTR (Kar) 179 : (1977) 108 ITR 935 (Kar) wherein it was held as under: "All decided cases except one have uniformly taken the view that levy of interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evance. The appealability of dispute regarding interest under s. 215 [and for that matter also under s. 139(8)] was, however, elaborated by the Hon'ble Supreme Court with reference to s. 246(c) of IT Act, 1961 Similarly, in (1999) 157 CTR (Cal) 161 : (2000) 241 ITR 269 (Cal), the Hon'ble Calcutta High Court has held that no appeal lies against the AO's order of levying interest under s. 220(2) while giving effect to the order of the Tribunal. In this citation also, the non-maintainability of appeal has been held with reference to s. 246(c) of IT Act, 1961, as it existed at the relevant time, and the same, may, for convenience sake, be quoted as under: "246(c)- An order against the assessee where the assessee denies his liability to be assessed under this Act or any order of assessment under sub-s. (3) of s. 143 or s. 144, where the assessee objects to the amount of income assessed, or to the amount of tax determined, or the amount of loss computed, or to the status under which he is assessed." It may be noted that s. 246 deals with the first appeal which is preferred before Dy. CIT(A) or CIT(A) and not to the appeal preferable before the Tribunal. The appeals before the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of first appellate authority by passing a suitable order remedying the wrong appropriately. 13. Now coming to the appeals under consideration, we may note that the three impugned orders, appealed against before the Tribunal, in the instant cases, are the orders of the first appellate authority passed under s. 250 and the present appeals under consideration are under s. 253 and not under s. 246. Obvious as it is, the citations referred to by the learned Departmental Representative of Revenue has no application in the matters in hand. As such, these three appeals of the assessee, though with respect to only interest under s. 139(8) and s. 215, are very much maintainable in law inasmuch as the same have been preferred against the orders of first appellate authority passed under s. 250 against which the statute specifically provides for the remedy being availed of by the assessee. The learned Departmental Representative's objection accordingly fails. 14. Now we take up the issue regarding charge of interest under s. 139(8) and s. 215 of the IT Act in reassessment under s. 147/s. 148. The interest under s. 139(8) and s. 215 are chargeable in the regular assessment. In Expln. 2 to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at where there is no dispute about the interest and the interest has not been assessed at all, in such cases the word "increased" cannot be interpreted to include imposition of interest. In other words, where interest has not been charged at all in the regular assessment, the word "increased" cannot be applied so as to embrace within its fold the fresh imposition/charge of interest in the reassessment. 15. The above view is also supported by the decisions of Hon'ble Rajasthan High Court in CIT vs. Smt. Padam Kumari Surana (1994) 207 ITR 155 (Raj), and (1992) 106 CTR (Raj) 144 : (1992) 198 ITR 556 (Raj). Besides the above decisions, of the Hon'ble jurisdictional High Court, we may also quote with advantage of observations of Hon'ble Karnataka High Court in (2000) 159 CTR (Kar) 354 : (2000) 243 ITR 836 (Kar)as under: "In reassessment also there can be circumstances where the total income is recomputed again and in that case the original assessment order is effaced. The provisions of ss. 139(8) and 215 of the IT Act, 1961, are not applicable to such reassessment proceedings." 16. We may now analyse the present appeals considering the fact-situation of each assessment year. Keepi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... than 75 per cent of the assesseed tax. The "assessed tax" has been defined in sub-s. (5) of s. 215 to mean "the tax determined on the basis of regular assessment". As per this provision, the assessed tax is the amount of tax determined in the regular assessment. The combined effect of the aforesaid provision is that the interest under s. 215(1) is to be charged on the amount by which the advance tax paid by assessee falls short of 75 per cent of the assessed tax or the tax determined in the regular assessment. Although, as per sub-s. (3) of s. 215, with the increase in the amount aforesaid on which the said interest is chargeable, interest so chargeable shall be increased but the amount on which interest under s. 215(1) is chargeable is to be determined on the basis of two amounts, one being the amount of advance tax paid by the assessee, and the other being 75 per cent of the assessed tax, and both these amounts remain unaffected/unchanged on reassessment under s. 147, when regular assessment has already been made prior thereto. In sub-s. (3) of s. 215, the reference of s. 147 seems to have been made to mean reassessment presupposing the already existing regular assessment, or el ..... X X X X Extracts X X X X X X X X Extracts X X X X
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