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TMI Blog2017 (2) TMI 782X X X X Extracts X X X X X X X X Extracts X X X X ..... the decision of Central Provinces Manganese Ore Co. Ltd. (1986 (5) TMI 3 - SUPREME Court ) to reach to the conclusion that no appeal under Section 246(1) (c) of the Act would lie only against levy of interest. As we are conscious that the above two decisions of this Court proceeded on concession of the Counsel for the assessee therein. Thus, this question is to be answered in favour of the applicant assessee. Liable to pay any interest under Section 215 of the Act for non-payment of advance tax in December, 1975 - Held that:- Considering the submission of the applicant assessee that non-payment of advance tax was on account of circumstances beyond the control of the assessee and for a reasonable cause, would not warrant deletion of interest payable on account of short payment / non-payment of the advance tax while considering the Subsection (1) of Section 215 of the Act. The considerations may have been different if we were considering an application of waiver under Subsection (4) of Section 215 of the Act.In the above view the applicant assessee is liable to pay the interest under Section 215 of the Act as held by the Tribunal.- Decided against the applicant assessee. - Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7; 30 lacs were subject to brought forward deficiency u/s 80J at ₹ 60,28,000/and, therefore, there was no positive income. It was also contended that it was only after the amendment was brought about by the Finance (No.2) Act, 1980, the provisions of Section 80J, the assessee's claim u/s 80J was denied and, therefore, the assessee should not be penalised. The CIT(A) found that relief quantified for the assessment year 1975-76 was in accordance with the decision fo the Calcutta High Court in Century Enka which came to ₹ 30,47,372/besides the claim for the year under consideration at ₹ 32,19,640/, as against which the assessee's income before the adjustment u/s 80J was ₹ 31,25,153/. He held that since the assessee had determined the relief in accordance with the Calcutta High Court decision, the assessee could not be found fault with and, therefore, the estimate filed by it could not be considered to be an underestimate. He also observed that as the assessee denied its liability to pay interest, the appeal was maintainable. On the whole, the assessee's appeal came to be allowed. 3. The Tribunal, after elaborate discussion on the issue, came t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essed or to the amount of tax determined or to the amount of loss computed or to the status under which he is assessed. Inasmuch as the levy of interest is a part of the process of assessment, it is open to an assessee to dispute the levy in appeal provided he limits himself to the ground that he is not liable to the levy at all. In this connection we may usefully refer to the decision of the Karnataka High Court where in a judgment in National Products v. Commissioner of Income Tax, Mysore, [1977] 108 ITR 935. Govind Bhat, C.J., explained the position in regard to the levy of interest under S.139 and under S.215. After referring to the earlier cases on the point he observed: All decided cases except one have uniformly taken the view that levy of interest under Section 18A(6) or section 18A(8) of the 1922 Act or levy of interest under Section 215 of the Act is not appealable but in the appeal against a regular assessment, it is open to the assessee to take every contention which, if accepted, must result in the Income Tax Officer holding that there was no liability to pay advance tax and, therefore, there was no liability to pay penal interest. In other words, it is open to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is clear that an appeal would lie against the charging of interest under Section 215 of the Act only if the appellant assessee denies his liability to pay the advance tax at all or challenges the quantum of advance tax determined by the Assessing Officer. Therefore, an appeal simplicitor to reduce the interest or waive the interest without challenging the determination of the advance tax either in whole or in part, would not be maintainable. Therefore, if the amount of advance tax is not disputed, the respondent cannot challenge only the levy of interest. This understanding of our is fortified by the decisions of this Court in Gammon India Vs. CIT 202 ITR 986 Phaltan Sugar Vs. Commissioner of Income Tax, 208 ITR 989 wherein even the Advocates for the assessee conceded the position that no appeal would lie only against levy of interest under Section 215 of the Act. It is made clear that we have independently applied our mind to the decision of Central Provinces Manganese Ore Co. Ltd. (supra) to reach to the conclusion that no appeal under Section 246(1) (c) of the Act would lie only against levy of interest. As we are conscious that the above two decisions of this Court proceede ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted on behalf of the applicant that such retrospective amendment would not invite the liability to pay interest under Section 215 of the Act. In support, Ms. Vissanji relied upon the following decisions : i. Commissioner of Income Tax Vs. Revati Equipment Ltd. 298 ITR 67 (Madras). ii. Enami Ltd. Vs. Commissioner of Income Tax, 337 ITR 470 (Calcutta). iii. Commissioner of Income Tax Vs. JSW Energy Ltd., 379 ITR 36 (Bombay). iv. Commissioner of Income Tax Vs. SAB Industries, Chandigarh (P H). v. Hindustan Construction Co. Ltd. Vs. Commissioner of Income Tax, 208 ITR 298 (Bombay). vi. Commissioner of Income Tax Vs. Gurkartar Steels Pvt. Ltd. vs. 209 ITR 634(P H). vii. Prime Securities Ltd. Vs. Asstt.DCIT, 333 ITR 464 (Bombay). viii. Commissioner of Income Tax Vs. Rainbow Industries, 277 ITR 507 (Gujarat). ix. ACIT Vs. EMMTICT Engineering Ltd. 316 ITR 153 (Gujrat) (c) Before considering the above decisions, we must note that one additional feature in this case is that the amendment as also the decision of Calcutta High Court in Century Enka (supra) was subject of consideration by the Apex Court in Lohia Machines Ltd. Vs. Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act prior to the amendment is no different from it reading post amendment. Further, the decision of the Calcutta High Court in Century Enka (supra) was also overruled. Thus, the basic reason for not paying the advance tax on the part of the applicant never existed. (e) The decision at Sr. No.(v) in the case of Hindustan Construction Co. Ltd. (supra) of this Court relied upon by the applicant does not in our view assist the applicant. All that the decision did was to restore the issue to the Tribunal to decide the leviability of the interest under Section 215 of the Act taking into account the decision of the Apex Court in Central Provinces Manganese Ore Co. Ltd.(supra). This was for the reason that the decision of the Tribunal was rendered prior to the decision of the Apex Court in the Central Provinces Manganese Ore Co. Ltd.(supra). (f) The decision in Gurkartar Steels Pvt. Ltd. (supra) of Punjab Haryana High Court at Sr. No. (vi) above has no application to the present facts for the reason that it was rendered on an application under Section 256(2) of the Act. The Court refused to direct the Tribunal to frame a question for its consideration as the Tribunal had decide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to higher determination of tax. Similarly, the decision at Sr. No.(ix) of the Gujarat High Court in EMMTILI Engineering Ltd. (surpa) upheld the deletion of interest under Section 215 of the Act done by the Tribunal. It upheld the view of the Tribunal that no interest could be levied on account of the additions made in the assessment order as the same is highly debatable and could not have been foreseen at the time of filing the advance tax. Therefore, both the above decisions were rendered in the context of finding of facts by the Tribunal. (i) Moreover, both of the above decisions of Gujarat High Court completely ignore subsection (4) of Section 215 of the Act, which provides for reduction or waiver of the interest payable by the assessee under Section 215 of the Act. Therefore, both the above decisions of the Gujarat High Court most respectfully in our view were rendered subsilentio. It is this subsection (4) of Section 215 which inter alia takes into account the circumstances beyond the control of the assessee for having paid less advance tax than that finally determined to be payable. The argument of hardship, bona fide conduct etc. would be appropriately considered when a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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