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TMI Blog2013 (10) TMI 307X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of tax, this will have the effect prospectively and not retrospectively - Interest for the period from 1.4.84 to 30.8.88 was therefore correctly held admissible – Decided against the Revenue. - Tax Appeal No. 610 of 2012 - - - Dated:- 29-1-2013 - Akil Kureshi And Sonia Gokani,JJ. For the Petitioner: Mr. Manav A. Mehta, Advocate ORDER (Per : Honourable Ms. Justice Sonia Gokani) 1. Challenging the order of the Income Tax Appellate Tribunal dated 16th March 2012, the Revenue has proposed the following substantial question of law for our consideration : Whether the amendment to section 139(8) and 215(3) of the Act is retrospective or prospective? 2. We have heard learned counsel Mr.Mehta for the Revenue and ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de on 30th March 1988 and therefore, interest under sub-section (3) of section 215 was chargeable from 1.4.84 to 31.3.88. 6. This was when challenged by the Revenue before the Tribunal, the Tribunal held the amendment in section 139(8) of the Act as prospective and therefore, further held that interest could be charged only on the tax liability determined on regular assessment. It also held that the interest charged under section 215(3) of the Act was chargeable for the period from 1st April 1984 to 31st March 1988 as tax liability determined in order dated 30.3.88. 7. It would be apt, at this stage, to refer to section 139(8) and section 215(3) of the Income Tax Act, 1961 ( the IT Act hereinafter) as under : 7.1 Sec.139(8) of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay of June of the assessment year, whichever is later; (b) in the case of every other assessee, the 30th day of June of the assessment year. Explanation 2. Where, in relation to an assessment year, an assessment is made for the first time under section 147, the assessment so made shall be regarded as a regular assessment for the purposes of this sub-section. (b) Where as a result of an order under section 147 or section 154 or section 155 or section 250 or section 254 or section 260 or section 262 or section 263 or section 264 17[or an order of the Settlement Commission under sub-section (4) of section 245D, the amount of tax on which interest was payable under this sub-section has been increased or reduced, as the case may be, the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall have effect as if for the words seventy-five per cent , the words eighty-three and one-third per cent had been substituted. (2) Where before the date of completion of a regular assessment, tax is paid by the assessee under section 140A or otherwise, (i) interest shall be calculated in accordance with the foregoing provision up to the date on which the tax is so paid ; and (ii) thereafter, interest shall be calculated at the rate aforesaid on the amount by which the tax as so paid (in so far as it relates to income subject to advance tax) falls short of the assessed tax. (3) Where as a result of an order under section 147 or section 154 or section 155 or section 250 or section 254 or section 260 or section 262 or section 263 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a regular assessment for the purposes of this section and sections 216, 217 and 273. 7.3 This provision provides for charging of interest if default is committed by the assessee in not paying the advance tax due within time prescribed. 8. Upon close perusal of the provisions as also the discussion made by the authorities below, we notice that the tax liability cannot be increased as there was no provision earlier for such enhancement. Section 139(8) is substituted by the Taxation Laws (Amendment) Act, 1984 with effect of 1st April 1985 which shall apply from A.Y. 1985-86 and not for A.Y. 1984-85 which is under question. 9. In the provision prior to the amendment, proportionate income on reduction of interest to be paid was not on t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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