9911796707
TMI Blog1986 (2) TMI 140X X X X Extracts X X X X X X X X Extracts X X X X ..... he Income-tax Act, 1961 ( the Act ) on the refund of excess tax paid by the assessee amounting to Rs. 22,568. The Commissioner (Appeals) found from the assessment order that the ITO determined a net refund of Rs. 22,568 after giving credit for a sum of Rs. 85,000 paid by the assessee during the financial year 1979-80. The ITO described this payment as tax paid otherwise , whereas the assessee contended that this was actually the advance tax paid by it under section 209A of the Act. The ITO refused to grant any interest under section 214 on this refund of Rs. 22,568 since he declined to recognise the payments made by the assessee during the financial year 1979-80 as advance tax payments. The Commissioner (Appeals) further found that though some assessment was already made on the assessee before 15-6-1979 when the first instalment of advance tax was due and thus though the assessee was required to file the statement of advance tax in Form No. 28A prescribed by the Income-tax Rules, 1962, ( the Rules ) the assessee had filed an estimate in Form No. 29 prescribed by the Rules. He further found that in this estimate filed by it, the assessee disclosed a larger amount of current income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e revenue, Their only plea was that they want to keep this issue alive. We, therefore, respectfully follow the two decisions of the Madras High Court in Chitra Sagar s case and T.T. Investments Trades (P.) Ltd. s case and the decision of the Tribunal in the case of Balasubramania Mills Ltd. and hold that the Commissioner (Appeals) was right in accepting the assessee s contentions and in directing the ITO to allow interest to the assessee on the refund due to it under section 214. 4. However, the learned departmental representative raised another objection by way of an argument at the time of hearing of the appeal on the question of maintainability of the additional ground that was filed by the assessee before the Commissioner (Appeals) on the non-granting of interest under section 214 by the ITO. According to Shri Jagannathan, this argument of the revenue would be covered by ground No. 2 raised before us and that since this was purely a legal issue, the revenue should be allowed to raise the same. He also contended that no appeal would lie against an order disallowing interest under section 214 as held by the Special Bench of the Tribunal in ITO v. India Tyre Rubber Co. (I) ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly maintainable in law and was rightly entertained by the Commissioner (Appeals). The decision of the Madras High Court in Rajyam Pictures case directly and fully supports the case of the assessee. At pages 849 and 850 after referring to the decision of the Bombay High Court in the case of Jagdish Prasad Ramnath their Lordships of the Madras High Court held as follows : ... We respectfully follow the reasoning in this judgment on the facts of this case as no appeal has been preferred against the assessment order as such. Appeals were taken only from the order imposing penal interest. In fact, the assessee had not questioned the imposition of tax. The only matter sought to be agitated is against the imposition of penal interest. We, therefore, hold that no appeal will lie against such imposition of penal interest alone under section 246(c) of the Income-tax Act..... It would he noticed that in the said case before the Madras High Court the assessee had not filed any appeal against the assessment order as such, but had filed an appeal against an order imposing penal interest. It was for this reason that their Lordships answered the question in favour of the revenue and against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad.). 10. The next decision is the one in the case of Triplicane Urban Co- operative Society Ltd. v. CIT [1980] 126 ITR 125 (Mad.). In this case, after referring to all the earlier decisions of the Court and also the decision of the Calcutta High Court in CIT v. Lalit Prasad Rohini Kumar [1979] 117 ITR 603, their Lordships of the Madras High Court held as follows : The view taken in the last-mentioned case was that so long as the assessee had some grievance regarding the assessment, he could include his objection to the levy of interest in the appeal before the AAC but an appeal will not, however, lie only against the levy of interest simpliciter. The same principal would hold good even with reference to the claim Of interest by the assessee on the refund due to him. In CIT v. Lalit Prasad Rohini Kumar [1979] 117 ITR 603, the Calcutta High Court also has taken the same view, viz., the interest factor in the assessment could not by itself be a subject-matter of appeal before the AAC. But there is no bar to its being raised as part of the appeal on other grounds. Again, their Lordships have held as follows on the facts of the case before them : ... The assessee could have ..... X X X X Extracts X X X X X X X X Extracts X X X X
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