9911796707
TMI Blog2013 (2) TMI 453X X X X Extracts X X X X X X X X Extracts X X X X ..... - section 220(2A) is an incentive to defaulter-assessee to co-operate with the Department and to remit the tax voluntarily at the earliest and, therefore, compliance should be rewarded by taking a liberal view and approach. In this case all the three conditions were to some extent satisfied, and the refusal of the Chief Commissioner to grant reduction in interest is not justified – Therefore assessee is entitled to partial relief - AO was directed to grant reduction of interest by 25 per cent. - - - - - Dated:- 16-8-2011 - RAMACHANDRAN NAIR C. N., GOPINATHAN P. S. JJ JUDGMENT C. N. Ramachandran Nair J.- This writ appeal is filed against the judgment of the learned single judge upholding the order issued by the Chief Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 30-03-2009 (adjust of refund) 68,340 08-06-2009 1,18,95,253 27-06-2009 44,037 Total 2,17,73,630 After making payment as above, the assessee made an application under section 220(2A) before the Chief Commissioner for waiver of interest demanded under section 220(2) for belated payment, which was Rs. 9,48,640. The Chief Commissioner, however, held that the assessee has not satisfied all the three conditions provided under clauses (i) to (iii) of section 220(2A) inasmuch as the assessee blocked recovery by obtaining stay against attachment notices and the assessee had not co-operated in recovery proceedings and payment of interest will not cause any g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion to be considered is whether on the facts stated above the assessee was rightly held to be ineligible for waiver of any interest. The Chief Commissioner has in its order stated that unless all the conditions stated above are cumulatively satisfied the assessee is not entitled to waiver. Even though the legal position stated by the Commissioner is not he subject-matter of controversy, what we feel is that the Chief Commissioner has not taken into account the benefit derived by the Department in assessee retaining the term deposits with the banks, which led to delay in payment of tax by the assessee. The assessee's counsel submitted that pre-mature withdrawal of the term deposits for payment of tax would have led to loss to the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... partment. From the pattern of payment stated above, what is clear is that the assessee voluntarily remitted the entire amount of tax before the Department started chasing the assessee with steps for recovery such as attachment of movables or immovables, sale of the same in public auction, etc. In fact, the entire arrears are seen paid within six months from the due date of payment based on the assessment. It is to be noted that the asses-see was also pursuing challenge against the assessment before the statutory appellate authorities. Of course it is open to the assessee to have paid the tax under protest and proceeded with appeal without going for stay against recovery proceedings. However, when stay is obtained pending disposal of the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hold that the assessee is entitled to partial relief. In the normal course, we should remand the matter to the Chief Commissioner for reconsideration for reduction of interest. However, for the sake of finality we can grant partial relief to the assessee by taking into account the amount of tax paid by the assessee on the interest earned on the term deposits, the retention of which delayed payment of tax that led to levy of default interest. We, therefore, allow the writ appeal by vacating the judgment of the learned single judge and modify the impugned order of the Chief Commissioner by reducing the interest from 12 per cent. per annum levied to 9per cent. per annum. Consequently, the Assessing Officer is directed to grant reduction of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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