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TMI Blog2011 (1) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act as held by the Tribunal, order of the Tribunal upheld and dismiss the Department appeals - ITA No. 20 of 2010 - - - Dated:- 20-1-2011 - C.N. Ramachandran Nair, Bhabani Prasad Ray, JJ. JUDGMENT Ramachandran Nair. J 1. The common question raised in these two appeals filed by the Revenue against the very same assessee is whether in a re-assessment completed under section 153A read with section 143 (1) of the Income-tax Act (hereinafter referred to as the Act for short), interest for short payment of advance tax is to be demanded for the period provided under section 234B(1) or section 234B(3) of the Act. While the case of the department is that interest is leviable under section 234B(1) for the period stated the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d therein. The assessee filed rectification application before the Assessing Officer contending that interest in re-assessment could be charged only under section 234B(3), whereunder the period for which interest could be charged is from the date of first completion of section 143(1) proceedings till the date of the revision of assessment, which was done under section 143(1) read with section 153A and not from the beginning of the financial year following the accounting year in which advance tax was payable as provided under section 234B(1) of the Act. The Assessing Officer rejected the rectification application on the ground that the re-assessment under section 153A itself is completed by processing the returns under section 143(1) and so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erest was payable under sub-section (1) is increased, the assessee shall be liable to pay simple interest at the rate of (one) per cent for every month or part of a month comprised in the period commencing on the day following (the date of determination of total income under sub-section (1) of section 143 (and where a regular assessment is made as is referred to in sub-section (1) following the date of such regular assessment) and ending on the date of the re-assessment or recomputation under section 147 (or section 153A), on the amount by which the tax on the total income determined on the basis of the re-assessment or recomputation exceeds the tax on the total income determined (under sub-section (1) of section 143 or) on the basis of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on applicable for interest on short payment or non-payment of advance tax is section 243B(3) of the Act. 6. After hearing both sides, we feel there is no substance in the contention raised by the Revenue that in a re-assessment completed under section 153A interest for non-payment or short payment of advance tax is payable under section 234B(3) merely because the said re-assessment under section 153A is completed by accepting the return filed under section 143(1) of the Act. Interest for non-payment or short payment of advance tax is payable under section 234B for different periods under sub-sections (1) and (3) of the said section. In all cases of regular assessments completed under section 143(1) interest is to be charged for the peri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing escaped income or undisclosed income pursuant to search or requisition, such assessment will always be a re-assessment or recomputation under section 153A, and unless it is a first assessment, that could be treated as the regular assessment in terms of explanation (2) to section 234B(1), then interest can be charged only under section 234B(3) of the Act. In this case, the original returns were processed under section 143(1) of the Act and the proceedings so completed were issued to the assessee. It is only thereafter the Department conducted search and made revised assessments under section 153A of the Act though by accepting returns of undisclosed income filed and by issuing proceedings under section 143(1) read with section 153A o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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