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TMI Blog2012 (6) TMI 621X X X X Extracts X X X X X X X X Extracts X X X X ..... on on the date of the alleged default to pay tax at that particular rate, he cannot be accused of having committed default and made to pay interest as compensating the revenue for having not paid the money. assessee is liable to pay advance tax as per the amended provisions of Section 115JB for the relevant period. However, he is not liable to pay interest on the amount due as per the amended provision. no liability to pay interest on the difference in the tax paid. - Decided in favour of the assessee and against the Revenue - IT Appeal No. 88 of 2006 - - - Dated:- 30-8-2011 - N. Kumar and Ravi Malimath, JJ. M.V. Seshachala for the Appellant. S. Parthasarathi and Mallaharao K. for the Respondent. JUDGMENT N. Kumar, J. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , as are contained in the Finance Act. As is clear from Section 207, the advance tax was payable on the total income of the assessee which would be chargeable to tax for the assessment year immediately following the financial year. Prior to amendment in so far as payment of advance tax by the companies is concerned. Section 115JB provided that the tax is payable on the total income as computed under this Act in respect of any previous year relevant to the assessment year commencing on or after 1st April of 2001 is less than seven and one half per cent of its hook profit and the tax payable for the relevant previous year shall be deemed to be seven and one-half per cent of such book profit. (17) Though section 115JB provided the rate of ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nishment by payment of interest with retrospective effect. By a catena of decisions, the Supreme Court has laid down that the payment of interest for delayed payment of tax is compensatory in nature. It is a suffered liability. Though such a liability could be created retrospectively, when such a liability is retrospectively created, the assessee cannot be accused of committing default and he cannot be charged with interest for such default. As the assessee was under no obligation on the date of the alleged default to pay tax at that particular rate, he cannot be accused of having committed default and made to pay interest as compensating the revenue for having not paid the money. The liability to pay advance tax on payable income tax is no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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