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TMI Blog2012 (7) TMI 551X X X X Extracts X X X X X X X X Extracts X X X X ..... ind and without conducting due and proper enquiry Regarding interest on late furnishing of return - section 234A(3) mandates levy of interest for late furnishing of the return, in response to section 148 of the Act - Assessing Officer has not charged this interest, the order is erroneous and prejudicial to the interests of revenue to this extent - Assessee is partly allowed. - I.T.A. No. 2566/Del/2010 - - - Dated:- 25-5-2012 - SHRI A.D. JAIN, SHRI T.S. KAPOOR, JJ. Assessee by : Sh. Sanjay Aggarwal, Sh. Rajiv Jain, CAs Department by : S h. Sudesh Garg, C.I.T (D.R.). ORDER PER A.D. JAIN: JM This appeal by the Assessee is directed against the order of the Ld. Commissioner of Income Tax-XIV, New Delhi dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithout proper application of mind and without conducting due and proper enquiries as per law and finally concluding the order as erroneous. 4. Having re-opened the assessment for A.Y. 2000- 01 u/s 263 on the specific grounds of nonassessment of interest on enhanced land compensation and non-charging of interest u/s. 234A of the Act, the action of the C.I.T. ordering cancellation of the whole assessment lacks proper exercise of jurisdiction. 5. That the appellant craves leave of this Hon ble Court to add, amend, alter or withdraw any ground at the time of hearing. 3. In this case assessment for A.Y. 2000-01 was completed at an income of Rs. 30,47,750/- as against revised returned income of Rs. 14,11,147/-. During the previous years ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50). On the basis of the above, the Assessing Officer opined that the enhanced compensation amounting to Rs. 45,05,464/- was fully taxable under the head capital gains u/s. 45(5)(b) of the Act, in the A.Y. 2000-01. However, the Assessing Officer did not include in the income, the sum of Rs. 1649139/-, which was received by the assessee by way of interest on enhanced compensation. 4. In the order passed u/s. 263 of IT Act, the Ld. Commissioner of Income Tax noted that the record showed that all the capital gains on account of enhanced compensation amounting to Rs. 45,05,464/- was assessed u/s. 45(5) of the IT Act, but interest income on enhanced compensation amounting to Rs. 1649139/- was neither assessed on accrual basis, nor on receip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing deduction of TDS, was assessable on receipt basis. The Ld. Commissioner of Income Tax further noted that interest u/s 234A had not been charged for late furnishing of the return in response to notice u/s. 148 of the IT Act. Thus, the C.I.T. concluded that assessment order u/s. 143(3) for A.Y. 2000-01 was liable for action u/s. 263 of the IT Act, as the assessment order passed by the Assessing Officer was erroneous in so far as it was prejudicial to the interests of the revenue, as the assessment had been framed in an undue haste without proper application of mind and conducting due and proper enquiries as per law. The Ld. Commissioner of Income Tax cancelled the assessment and directed the same to be done afresh. 5. Against the above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of C.I.T. vs. Ghanshyam (HUF) , 315 ITR 1 (SC), the same cannot be brought in at a later stage; and that therefore, the order under appeal being wholly unsustainable in law, the same be cancelled and the assessment order be revived while allowing the assessee s appeal. 7. The Ld. D.R., on the other hand, has strongly supported the impugned order. It has been contended that as rightly pointed out by the Ld. C.I.T., the assessee had not shown the interest of Rs. 1649139/- on enhanced compensation, either on accrual basis, or on receipt basis; that this issue was never examined by the Assessing Officer; that the Assessing Officer, though, was alive to the fact that the interest was assessable on receipt basis, in as much as as noted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee has not offered the same to tax by giving a note in the return of income that the same shall be offered for tax, if and when the matter is fianlised by the Highest Court in favour of the assessee in terms of the judgement of the Supreme Court in C.I.T. vs. Hindustan Housing and Land Development Trust Ltd. 161 ITR 524 (SC). The Assessing Officer was not satisfied by this. He held that the enhanced compensation amounting to Rs. 45,05,464/- was fully taxable under the head capital gains u/s. 45(5)(b), in A.Y. 2000-01. However, the Assessing Officer did not bring to tax the interest portion of the enhanced compensation amounting to Rs. 1649139/-. In Note 2 in the assessment order, the Assessing Officer had mentioned that interest a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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