9911796707
TMI Blog1971 (11) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment orders, the petitioner-company, which was by then functioning, took up the matter in appeal before the appellate authority as well as the Tribunal. But it is seen from the records that during the course of such proceedings the company went into liquidation on April 30,1959, on the final orders of this court in O.P. No. 297 of 1957. The official liquidator, thereafter, had to carry on the necessary administration connected with the winding-up of the company, one amongst which was to prosecute further the petitions or appeals by then filed by the company before the appellate or revisional authorities in the matter of assessments on the quondam company for tax. It is not in dispute that it was only on April 19, 1962, when the official liquidator came up to this court with a request for a reference on the alleged questions of law arising on the orders of the Income-tax Appellate Tribunal, which was ultimately refused by this court, that a quietus was given to the tax liability of the quondam company for the years in question. It can only then be fairly assumed that the total income of the company which was finally to be subject to levy in accordance with law was reckoned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y passing a non-speaking order and it was only on a second approach that he made the challenged order. The learned counsel for the petitioner contends that, as interest is a necessary concomitant to principal, and if the principal itself has not yet been ascertained finally, then the contention that the application should be made to the authorities without awaiting such finalisation of the income is not proper. His second contention is that there was not any unreasonable delay, in the peculiar circumstances of the case, and that the Commissioner of Income-tax failed to exercise his jurisdiction, though of a discretionary nature, by not dealing with the merits but dismissing the revision petitions as incompetent and delayed. On the other question that during the pendency of an appeal against the order of assessment, no application for revision of the assessment order made by the Income-tax Officer which relates to the payment of penal interest is maintainable, the learned counsel submits that such reasoning no longer survives in view of the pronouncements of this court. I shall-now take up the last contention. Though the Commissioner of Income-tax referred to the aspect that no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers and there was no final assessment of total income cannot any longer survive and be accepted. The next contention is on the very scope of section 18A(8) of the Indian Income-tax Act, 1922. Section 18A(8) enables the Income-tax Officer to add on to the tax determined on the basis of the regular assessment made by him interest as prescribed under the sub-section, provided that the Income-tax Officer finds that no payment of tax has been made in accordance with the other preceding sub-sections of section 18A. In the instant case no such payment has been made. The Income-tax Officer was, therefore, not in error in having levied what is loosely termed as penal interest. At one time it was not clear whether the fields of activity of sub-section (8) of section 18A and sub-section (6) of the same section were similar. At any rate, the Bombay and Madras views prior to Chockalingam and Meyyappan v. Commissioner of Income-tax, was different. In Lata Mangeshkar v. Union of India a Division Bench of the Bombay High Court took the view that, where no payment of advance tax had been made by the assessee in accordance with section 18A, the addition of interest in the regular assessment calcul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. These instructions would apply only to assessments completed after the issue of this Circular. Cases already decided should not be reopened. 3. The concluding paragraph of Circular No. 19 (XL-29) D of 1954 is hereby cancelled." According to the learned counsel, though the Bombay and Madras High Courts expressed a different view, the revenue, as a matter of policy, was inclined to be more liberal in view of the circular issued, but on record it does not appear to be so. The circular was not brought to the notice of either the Bombay High Court or this court, when they decided the above two cases. The result was that even the revenue, in spite of the circular, was of the view that rule 48 was applicable only to cases where part of the advance tax had been paid or to cases of assessment followed up by such payment and not to cases where the assessment proceedings were completed and no advance tax has been paid. The controversy, however, has been set at rest by the Supreme Court in Chockalingam and Meyyappan v. Commissioner of Income-tax. In very strong words, the Supreme Court observed : "Sub-section (6) of section 18A, without reserve, is expressly made applicable mutatis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law said to arise from the decision of the Tribunal, it cannot be said that such proceedings undertaken by the assessee are mere empty formalities and that such a situation cannot be availed of by him for the purpose of pleading in an ancillary proceeding, though at a later stage, that such application for reference was made by him bona fide and that he was prosecuting the assessment process further so as to obtain relief in a manner known to law. If, therefore, April 19, 1962, is to be taken as the date when the assessee could be said to have had reasonable notice of the finality of the assessment proceedings, then the question is whether he deliberately delayed the presentation of the petitions for waiver of the penal interest thereafter. I have already referred to the fact that between April 19, 1962, and October 12, 1962, the law was not clear as to whether such an application under rule 48 could be made in a situation where the assessment proceedings were completed and whether sub-section (8) of section 18A was a bar. According to the decision of this court in Panchavarnathammal v. Commissioner of Income-tax, the writ-petitioner could not have filed such a revision petition ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
