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TMI Blog1980 (10) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... ent banks etc. The assessee raises funds by issue of debentures to the public. It has refinance facilities from the Reserve Bank, the nationalised Banks, LIC and Agricultural Refinance and Development Corporation. The assessee's sources of income are property, interest, dividends etc. In making the assessment the ITO assessed the dividends incomes of Rs. 2,18,679 and Rs. 2,14,550 under other sources and held that this cannot be considered as the assessee's income from business and that hence the assessee is not entitled to deduction under s. 80P(2)(a)(i) in respect of the above income. In the assessee's appeals to the CIT(A) the assessee referred to the order of the AAC, E-Range, dt. 23rd Sept., 1979 for the asst. yrs. 1963-64 to 1969-70 where it was held on similar point that investment in the shares from which dividends have been received should be considered to be made in the course of the carrying on of the business and therefore the dividends received on such shares should be treated as the assessee's income from business though for the purpose of assessment it may be classified as coming under the head other sources. The CIT(A) held that in view of the above order as also the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stion were exhibited under the head Reserve fund investments and debenture redemption fund investment in the printed accounts of the assessee at pages 20 and 23 for the two years. The counsel submitted that the investment in shares from which dividends were received were its business assets, the assessee's business being to deal in money and credit and therefore, the shares in securities acquired by the bank in the course of its business and in compliance with the various regulations governing it constitute its business assets. The assessee's counsel in this behalf relied on the above decisions as also the Orissa High Court decision in CIT vs. Orissa State Co-operative Housing Corporation Ltd. (1976) 104 ITR 157(Ori). The counsel further submitted that the expression "attributable" in s. 80P (2)(a)(i) was much wider in scope than the word "derived" and the dividend income even if assessed under the "head sources" would constitute business income for the purpose of s. 80P(2)(a)(i). 4. We have carefully considered the rival submissions and are of the view that the Revenue's contention is not tenable. The share investment in question which resulted in the dividend income have been ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taxable income returned 5,000 5,000 (e) Tax deducted at source 24,32,922 28,76,147 (f) Date of assessment order 15-01-79 15-01-79 (g) Net taxable income assessed 6,34,738 6,49,854 Before the CIT(A) in appeal, the assessee contended that the ITO had refunded only Rs. 21,58,037 and Rs. 25,81,816 without allowing interest on delayed refund. The CIT(A) however rejected this ground in his view that there is no provision for filing an appeal on this point. 7. Before us the ld. counsel for the assessee referred to s. 141A (provisional assessment for refund) which provides that where a return has been furnished under s. 139 and the assessee claims that the tax deducted or paid at source (Chapter XVII-B) or advance-tax paid (Chapter XVII-C) exceeds the tax payable on the basis of the income tax returns, the ITO if he is of the opinion that regular assessment of the assessee is not likely to be made within 6 months from the date of furnishing of the return, shall make in a summary manner, within the said 6 months, a provisional assessment of the sum refundable to the assessee after making the necessary adjustments. The counsel referred to the explanatory note on the Finance A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ree with the proposition of the representative, as there is no provision under the Act under which the ITO could be directed to grant interest on the refund that is to be given to him arising out of the assessment he has proposed to make. It is no doubt true that if the ITO had made the provisional assessment under s. 141-A within the time allowed, the assessee would have been in receipt of the refund and he would not have been deprived of the interest that he would have earned on the said sum which is very sizable, but there is no provision either under s. 141-A or in the chapter dealing with refunds, directing the ITO to grant interest and it is only in respect of advance-tax paid that interest has been directed to be given on the excess amount from 1st day of the financial year of the year succeeding. In the absence of such a provision, no such directions could be given." The counsel submitted that in view of the above direction of the IAC the assessee was entitled to appeal on this point under s. 246(2)(f), that is an order of assessment under sub-s (3) s. 143 or s. 144 made on the basis of direction of issued by the IAC under s. 144-B. The counsel urged that this point was he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 144B deals with a case where the ITO proposes to make any variation in the income or loss returned which is prejudicial to the assessee and the amount of such variation exceeded the limit prescribed by the Board. In such a case the ITO forwards a draft of the proposed order of assessment to the assessee and on receiving assessee's objection if any the ITO shall forward the draft order together with objections to the IAC who gives such directions as he think fit, for the ITO's guidance after considering the objections. The scope of s. 144B is thus restricted to the modification of income or loss returned by the Department and can never cover the issue of non-allowance of interest on delayed refund. The mere accident that on an oral plea raised by the assessee the IAC gave his view in his written instructions under s. 144B would not entitle assessee to treat such finding as the IAC's direction under s. 144B which can fall within the scope of the appeal provided in s. 246(2)(f). The assessee's further plea that the ITO has failed in his duty cast on him by s. 141A and hence we should interfere is also not tenable. Where no appeal is provided on the assessee's cause of grievance the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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