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TMI Blog2015 (1) TMI 1071X X X X Extracts X X X X X X X X Extracts X X X X ..... for the legislature to remedy such an absurdity. The Courts cannot place any interpretation on these Sections which do not fall from the words used there in. In that view of the matter, the impugned orders passed by the authorities are unsustainable, as they are contrary to the statutory provisions contained in Section 12, and they are liable to be set aside. The assessee is not liable to pay any interest under Section 12 of the Act. - Decided in favour of the assessee. - ITA Nos. 129-134 of 2009 - - - Dated:- 28-10-2014 - N. Kumar And B. Manohar,JJ. For the Petitioner : Sri S. Parthasarathi, Adv. For the Respondent : Sri K V Aravind, Adv. JUDGMENT These appeals were admitted to consider the following substantial questions of law:- i) Whether the Tribunal was justified in upholding the levy of interest under Section 12 of the Act when there was no delay in filing the return in response to the notice under Section 10 of the Act? ii) Whether interest under Section 12 is leviable even when no assessment under Section 8(2) or 8(3) was made prior to the issuance of notice under Section 10 of the Act and there being no default in compliance of the notice und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 89,09,906/- Interest Tax thereon ₹ 2,67,297/- Add: Interest u/s. 12 ₹ 3,52,704/- 12A ₹ 4,32,864/- 12B Rs. - ₹ 7,85,568/- ₹ 10,52,865/- Assessment year 1998-99 Net chargeable interest ₹ 1,17,49,791/- Interest Tax thereon ₹ 2,34,996/- Add: Interest u/s. 12 ₹ 2,53,692/- 12A ₹ 3,19,586/- 12B Rs. - Net Payable ₹ 5,73,278/- ₹ 8,08,274/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions of the Act. Aggrieved by the said order, the present appeals are filed. 5. Section 12 on which reliance is placed to levy tax reads as under:- 12. Interest for default in furnishing return of chargeable interest.- (1) Where the return of chargeable interest for any assessment year under sub-section (1) of section 7, or in response to a notice under sub-section (2) of that section, is furnished after the due date, or is not furnished, the assessee shall be liable to pay simple interest at the rate of two per cent for every month or part of a month comprised in the period commencing on the date immediately following the due date, and,- (a) where the return is furnished after the due date, ending on the date of the furnishing of the return; or (b) where no return has been furnished, ending on the date of completion of assessment under sub-section (3) of section 8, on the amount of the interest-tax on the chargeable interest as determined under sub-section (2) or sub-section (3) of section 8 as reduced by the interest-tax paid in advance. Explanation 1.- In this section, due date means the 31st day of December of the relevant assessment year or, as the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and shall be deemed to be a notice under section 156 of the Income-tax Act as applicable to this Act by virtue of section 21, and the provisions of this Act shall apply accordingly; (ii) in a case where the interest is reduced, the excess interest paid, if any, shall be refunded. (5) The provisions of this section shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1992 and subsequent years. 6. As could be seen from the aforesaid provision, interest for default in furnishing the return of chargeable interest is payable where the return of chargeable interest for any assessment year under sub-section (1) of Section 7 or in response to a notice under sub-section (2), of that Section is furnished after due date, or is not furnished. Sub-section (1) of Section 7 provides for furnishing of a return of chargeable interest of the credit institution for the previous year in the prescribed form before the 31st day of December of the assessment year. In other words, it is a voluntary filing of the return by the assessee. If no such return is filed, the assessing officer is vested with the power under sub-section (2) of Section 7 to serv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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