9911796707
TMI Blog2001 (4) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... Income-tax Act, 1961 (in short "the Act" hereinafter). So the writ petitioner herein filed an application for waiver of interest under section 220, sub-section (2A) of the Act. In the application it was stated that the predecessor-in-interest of the writ petitioner filed returns showing net loss of Rs. 18,40,580 on August 14, 1973. Thereafter, a revised return was filed on November 25, 1975, showing net loss of Rs. 1,62,949. The Income-tax Officer completed the assessment on a total income of Rs. 19,20,560 on March 2, 1977, by making huge intangible additions and disallowances. On appeal before the Income-tax Commissioner (Appeals) and before the Income-tax Appellate Tribunal the total income was reduced. The Income-tax Appellate Tribunal sent back the matter on certain points to the Commissioner of Income-tax (Appeals) on June 26, 1979, and the Commissioner of Income-tax (Appeals) in his turn sent back the matter to the Income-tax Officer on April 14. 1986. Thus, the total income was reduced to Rs. 7,51,705 while giving effect to the appellate order under section 251. The Assistant Commissioner of Income-tax, without considering the merits of the case, imposed the demand payable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and it will have to close down its business. Thus, all the conditions required under the statute as aforesaid have been satisfied. Moreover. The additions and disallowances made therein were not in the proper perspective. The petitioner could not anticipate the said additions and the demand was stayed by the High Court at Calcutta. Learned counsel for the respondents has taken a point of law, though it was not raised nor was it discussed before the Commissioner. Both the parties proceeded on the basis that section 220(2A) has application in this case. Yet it is contended by the learned lawyer for the respondents that, admittedly, the aforesaid section has been inserted by the amendment of the Taxation Laws (Amendment) Act, 1984, on and from October 1, 1984 and the question of waiver of interest involved in the writ petition relates to the assessment years 1973-74 and 1974-75. In support of his contention, the learned lawyer for the Department has placed reliance on the decision of this court reported in Sri Sri Iswar Benodeswar Mahadev v. CWT [1999] 238 ITR 572. He contends that the aforesaid case was decided while dealing with section 31(2A) of the Wealth-tax Act, which, ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , since the petitioner has not fulfilled all the conditions mentioned in section 220(2A) of the Act. He referred to cases, viz., Ramapati Singhania v. CIT [1998] 234 ITR 655, 660 (All); Eminent Enterprises v. CIT [1999] 236 ITR 883 (Ker); Auro Food Ltd. v. CIT [1999] 239 ITR 548 (Mad); S. A. Wahab v. ITO [1998] 232 ITR 624 (Ker); New Shorrock Spg. and Mfg. Co. Ltd. v. CIT [1994] 208 ITR 765 (Bom); G. T. N. Textiles Ltd. v. Deputy CIT [1993] 199 ITR 347 (Ker) and Shri Ambica Mills Ltd. v. ITO [1993] 203 ITR 84 (Guj). Having heard learned counsel for the parties and considered the materials placed before me, I feel as a point of law, though for the first time here, has been raised by the respondent and argued by both the parties without reservation, my first task would be to examine whether the petitioner can get any benefit of the Taxation Laws (Amendment) Act, 1984, read with 1987 whereby and whereunder sub-section (2A) in section 220 has been inserted inasmuch as waiver of interest relate to assessment years 1973-74 and 1974-75. It is a trite position of law that the provisions of a substantive law cannot have any retrospective operation unless it is intended to be made so by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 1 (SC), cited by Dr. Pal the apex court, while deciding the question of applicability of clause (iii) substituted in section 271(1) by the Finance Act, 1968, held that it is the law operating on the date on which the wrongful act is committed which determines the penalty. Where penalty is imposed for the concealment of particulars of income, it is the law ruling on the date when the act of concealment takes place which is relevant. So, I reject the contention of the learned lawyer for the respondent that assessment year will be relevant and sub-section (2A) will not be applicable. In my view, the aforesaid sub-section will also be applicable in a case where the interest has already been paid though the assessee has reasons to apply for waiver. Therefore, the said sub-section will have partial retrospective effect in limited cases because of the language employed therein. The petitioner is entitled to apply for waiver or reduction of interest and for that matter the Commissioner has rightly entertained this application. To decide this case on the merits I have gone through the impugned order of respondent No. 1. Upon a plain reading of the order it appears to me that responde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be service of demand notice under section 156 of the Act. Needless to reiterate that interest under section 220 of the Act becomes payable after expiry of 30 days from the date of service of notice under section 156 of the Act. So interest calculated and charged up to January 20, 1990, becomes payable thereafter. The respondent No. 1 should have viewed that this is the circumstance which was beyond the control of any of the parties. Respondent No. 1 has not considered at all as to whether the applicant/ petitioner was really facing hardship of the payment of interest. He has recorded his reasons that the petitioner did not co-operate with the enquiry which is just contrary to the record. It appears that respondent No. 1 has recorded the petitioner initiated vexatious litigation in this court because of dismissal of the writ petition. Nothing is available from the judgment of this court dismissing the writ petition with any findings of the writ petition being vexatious. Respondent No. 1 cannot decide a subject contrary to what by necessary implication has already been decided by this court. I am not forgetful of the settled legal position that the reasons recorded by respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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