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TMI Blog2013 (5) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... itled to rely upon the decision of that court in A.V. Thomas’ case ( 1997 (1) TMI 60 - KERALA High Court). Petition is allowed in part - The orders Annexures-D and J of the Chief Commissioner of Income Tax, Bangalore are quashed and the petitioner is directed to pay 25% of the interest levied under Section 234B of the Act for the assessment year 2001-02. - Writ Petition No.16136 of 2011 - - - Dated:- 11-3-2013 - Ram Mohan Reddy, J. For the Appellants: Sri Malhara Rao Vijaykumar Punna. For the Respondents: Sri K V Aravind M V Seshachala. JUDGEMENT:- Petitioner company was extended the benefit of deduction under Section 80HHC of the Income-tax Act, 1961, for short Act for the assessment year 1996-97 by order dt. 31.3.1999 under Section 143(3) of the Act. That order when called in question by the revenue before the Commissioner of Income-tax, the Appellate Authority, by order dt. 7.4.2000 held that the assessing officer was not justified in extending the benefit and accordingly allowed the appeal following the decision of the Kerala High Court in Commissioner of Income-tax -v- V.T.Joseph - (1997) 225 ITR 731. Petitioner having filed an appeal before the Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ged under Section 234-A or 234-B or 234-C of the Act in classes of cases or classes of income, specified in Paragraph 2 of the said order. According to the learned counsel Paragraph 2(c) of the said order though illustrative, but not exhaustive, takes into its fold a situation where any income was not chargeable to income of an assessee on the basis of any order of the High Court within whose jurisdiction he is assessable to Income Tax and did not pay Income Tax in relation to such income in any previous year and subsequently as a consequence of a decision of the Supreme Court of India, in any assessment or reassessment proceedings the advance tax paid is less than the tax payable on his current income, the assessee is chargeable to interest under Section 234B or 234C and the Chief Commissioner is satisfied that it is a fit case for reduction or waiver, of such interest, may exercise such jurisdiction. According to the learned counsel the Authority ought to have exercised a jurisdiction vested in it under clause 2(c) of the Order dt. 26.6.2006 and waived interest under Section 234-B. Learned counsel hastens to add that though the revenue preferred IT Appeal No.127/2001 against th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . There is no dispute that the petitioner during the accounting year 2001-02 i.e. previous year 2000-01 claimed deduction under Section 80HHC on the basis of 90% of export incentives as worked out under the proviso to Subsection (3) of Section 80 HHC of the Act, by ignoring losses under clauses (a) and (b) of the said section, which was accepted by the Assessing Officer. That order when carried in appeal by the revenue before the Commissioner was reversed, while the further appeal preferred by the petitioner before the Tribunal led to restoration of the order of the Assessing Officer on the basis of the decision in A.V.Thomas case (Supra2) rendered by a learned Single Judge of High Court of Kerala. It is also not in dispute that the decision in A.V.Thomas case (Supra2) D.D.10.01.1997 was a judgment passed after the decision in V.T.Joseph s case (Supra1). The further fact not in dispute is that ITA 127/2001 preferred by the revenue was pending before this court without an interim order of stay of the order of the Tribunal . It is also undisputed that Tribunal was bound by the decision in A.V. Thomas case (Supra2), which held the field. In the circumstances petitioner s bonafid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at income when not chargeable to Income Tax in the case of an assessee on the basis of any order passed by the High Court within whose jurisdiction he is assessable to Income Tax and as a result did not pay Income Tax in relation to such income in any previous years, and by a decision of the Supreme Court any assessment or reassessment proceeding the advance tax paid by an assessee is found to be less than the amount of advance tax payable as the current income, the Chief Commissioner/Director General is satisfied that it is a fit case for waiver of interest under Section 234B or 234C, is entitled to such a benefit. 11. In the facts of this case the bone of contention of the revenue is that the assessee in the State of Karnataka did not have the benefit of any order of this Court permitting deduction under Section 80HHC of the Act, therefore is disentitled to that deduction on the basis of the decision in A.V.Thomas case (Supra2). 12. The preamble to the Order F.No.400/129/2002 IT (B) dated 26.6.2006 makes reference to the words class of cases or class of incomes as specified in paragraph 2 thereunder. A reading of paragraphs 2(a), (b), (c) and (d) what can be deciphered is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able on his current income, the assessee is chargeable to interest under section 234B or section 24C and the Chief Commissioner of Director General is satisfied that this is a fit case for reduction of waiver of such interest. 2. In partial modification of this para of the Order, the Central Board of Direct Taxes has decided that there shall be no condition that the decision of the High Court or the Supreme Court, as referred to therein, must be given in the assessees s own case. Also the condition that any retrospective amendment of law or the decision of the Supreme Court or the jurisdictional High Court must have been made after the end of the relevant year stand withdrawn. 14. Viewed in this perspective the decision of the High Court or Supreme Court need not be in the case of the assessee. In other words the decision of incidence and applicability of Income Tax under the act, need not necessarily be in the case of the assessee but could be in any other case i.e. of any other assessee or otherwise. As long as the decision covers the field of Income Tax legislation, as may be applicable to any assessee, would be a circumstance for reduction of waiver of interest under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relief upto 75% and directed the assessee to pay 25% of the interest levied. 18. In the circumstances the point for consideration is answered in the affirmative. Petitioner having made out a case for consideration over reduction or waiver of interest under Sec. 234B of the act, the Chief Commissioner of Income Tax was not justified in rejecting the claim by the orders impugned, on the premise that the petitioner an assessee not within the jurisdiction of High Court of Kerala was disentitled to rely upon the decision of that court in A.V. Thomas case, (Supra2). 19. Apparently the order Annexure-D is dt. 12.12.2006 while assessment year is 2001-02 and no useful purpose will be served by merely quashing the orders Annexures-D J of the Chief Commissioner of Income Tax and remitting the proceeding for consideration afresh, after applying its mind to the facts of the case, ends of justice would be met by waiving interest upto 75%. In the result, petition is allowed in part. The orders Annexures-D and J of the Chief Commissioner of Income Tax, Bangalore are quashed and the petitioner is directed to pay 25% of the interest levied under Section 234B of the Act for the assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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