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TMI Blog2016 (2) TMI 274X X X X Extracts X X X X X X X X Extracts X X X X ..... in upholding the levy of interest under Section 234A of the Act determined before taking notice of self assessment payment under Section 140A of the Act on the pretext that the entire tax in accordance with the declared income was not paid by way of self assessment tax before the due date of filing the return? [b] Whether the Tribunal was justified in not appreciating that the ratio down by the Hon'ble Apex Court in the case of CIT vs. Pranoy Roy [(2009) 309 ITR 231] cited before it while interpreting that the entire payment of tax was required to have been discharged before the due date of filing the return in order to justify the appropriation of tax before levy of interest under Section 234A of the Act? [c] Whether the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 234C of the Act. On receipt of the assessment order, the appellant filed rectification application under Section 154 of the Act, contending that interest under Sections 234A and 234B of the Act have been wrongly worked out. The Assessing Officer rejected the said application and directed the appellant to pay balance outstanding demand. Aggrieved by the same, the appellant preferred an appeal before the Commissioner of Income Tax [Appeals]. The Appellate Commissioner confirmed the calculation of interest made by the Assessing Officer and dismissed the appeal. Aggrieved by the Order of the Appellate Commissioner, the appellant preferred an appeal before the Income Tax Appellate Tribunal, Bangalore. The Tribunal declined to accept the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel for the Assessee places reliance on the Judgment of the Apex Court in the case of 'Commissioner of Income Tax and Another Vs. Pranoy Roy and Another' reported in [2009] 309 ITR 0231 and also the Judgment of the Delhi High Court in the case of 'Dr. Prannoy Roy & Another Vs. Commissioner of Income Tax and Another' reported in [2002] 254 ITR 0755. He would also place reliance on the Circular Instructions issued by the Under Secretary to Government of India in Circular No.2/2015 dated 10.2.2015 whereby the Board has decided that no interest under Section 234A of the Act is chargeable on the amount of self assessment tax paid by the Assessee before the due date of filing of the return of income. 6. On the other hand, Sri. K.V. Aravind, l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 30.9.2009. The self assessment tax was paid on various dates amounting to Rs. 40 lakhs prior to the date of filing of return of income and an amount of Rs. 10 lakhs was paid on 3.11.2009 subsequent to the date of filing of the return and the balance outstanding demand was Rs. 9,60,000/-. The Assessing Officer has levied interest on the entire amount of tax under Section 234A of the Act as no discretionary power is vested with the Assessing Officer to waive off the interest on the self assessment tax paid prior to the filing of the return of income. This is confirmed by the Appellate Commissioner as well as by the Income Tax Appellate Tribunal. 10. Section 234A of the Act contemplates interest for defaults in furnishing return of income. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provide for reduction of the amount of self assessment tax paid by the Assessee before the due date of filing return of income. We have also noticed that payment of interest is to compensate losses to the Revenue. In the absence of any statutory provision made for reducing such amount paid towards self assessment tax, the Authorities proceeded to levy interest on the entire amount de hors the payment of Rs. 40 lakhs made by the Assessee towards the self assessment tax before the due date of filing of return of income. A similar question was considered by the Apex Court in the case of Pranoy Roy [supra]. This Judgment of the Apex Court was considered by the Central Board of Direct Taxes in Circular No.2/2015 dated 10.2.2015 and the Board has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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