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TMI Blog1999 (8) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... est under s. 220(2) of the IT Act, 1961, amounting to Rs. 42,97,063 and in upholding the order of the CIT(A) ? 4. Whether, on the facts and in the circumstances of the case and on a correct interpretation of the relevant provisions of s. 214 of the IT Act, 1961, as it stood at the relevant time as also of those of s. 244(1A) of the Act, the Tribunal is justified in upholding the charge of interest under s. 220(2) of the IT Act, 1961, on the said interest for the period commencing from 26th Oct., 1982, to 31st May, 1986 ? 5. Whether, on the facts and in the circumstances of the case and on a correct interpretation of the relevant provisions of s. 244(1A) of the IT Act, 1961, the Tribunal was justified in holding that interest paid to the assessee on the basis of the earlier orders of the Tribunal can be withdrawn and/or recovered back from the assessee after the last order of the Tribunal was passed ? 2. After this reference counsel for assessee has revised the question No. 2 Counsel for Revenue has no objection in case the revised question be answered. Accordingly, we will consider revised question No. 2 as referred in the affidavit on behalf of the applicant dt. 6th July, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under s. 214 of the Act and Rs, 1,61,792 as interest payable to the assessee under s. 244(1A) of the Act. 4. There was some mistake in the order of Tribunal. That mistake was rectified on an miscellaneous application by giving effect to the order of Tribunal, On a miscellaneous application the total income was revised at Rs. 15,60,07,170 and total amount of income-tax and surcharge payable thereon were determined at Rs. 11,43,64,958. Thus, finally on the basis of order of Tribunal in assessee's appeal on a refund and excess advance tax he determined Rs. 2,92,207 and Rs. 3,58,150 as interest under s. 214 and s. 244 and s. 244(1A) of the Act, respectively, payable to assessee by the Department. 5. In appeal filed by the Department, Tribunal has passed the order on 24th April, 1986, whereby the total income was revised at Rs. 16,96,48,160 as against the previous total income of Rs. 15,60,07,174 determined on the basis of Tribunal's order in assessee's appeal and income-tax and surcharge thereon were determined at Rs. 12,43,76,385 after giving credit for tax deducted at source and advance tax paid. After giving effect to the order of Tribunal in Departmental appeal and after taki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s held that 'regular assessment' referred to under s. 214 means original assessment made under s. 214 of the Act. But the learned counsel submits that while giving effect to the appellate order, the order of the AO is relatable to s. 143(3) of the Act. 11. In the case of CESC Ltd. vs. CIT, the apex Court reiterated its earlier view and held that 'regular assessment' for the purpose of s. 214 means first assessment and interest payable by the Government is up to the first order of the assessment and any order passed in consequence of the finding or direction given by the higher authority will not be a 'regular assessment'. But the order giving effect to the appellate order will be an assessment made pursuant to the direction given by the higher authority. 12. The learned counsel for the Revenue, Mr. Agarwal, submits that the order under s. 220(2) is not appealable. He placed reliance on the decision of the Madras High Court in the case of CIT vs. Suresh Gokul Das (1998) 150 CTR (Mad) 290 : (1998) 229 ITR 721 (Mad) : TC 70R.305. In that case, there was a notice of demand for interest under s. 220(2) of the Act. The Madras High Court held that a notice of demand issued under s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e basis of net tax payable after giving effect to the appeal order. There is no direct decision of the apex Court that any order under s. 220(2) is appealable. 16. Admittedly, the provisions of s. 246 does not provide any appeal against the order under s. 220(2) and interest on the outstanding tax payable by the assessee. Secondly, the order under s. 220(2) of the Act does not form part of the order under s. 143(3) like the interest under ss. 214 and 217 of the Act. In fact while calculating the interest under s. 220(2) of the Act AO has no discretion or option, but to simply calculate the interest, on particular rate on the outstanding tax payable by assessee. 17. The assessee has also challenged that order on the ground that interest already paid under ss. 214 and 214(1A) of the Act, the AO cannot withdraw or recover that interest from the assessee while giving effect to the order of the Tribunal in appeal filed by the Department. 18. We peruse the order of the Tribunal in appeal by the assessee against the order of the AO whereby he has given effect to the order of the Tribunal on Departmental appeal. 19. Learned counsel further challenged the order of the AO on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act has been paid to the assessee, that cannot be withdrawn. 23. With regard to the question that whether the interest paid under s. 214 of the Act to the assessee can be withdrawn or can be recovered or can be adjusted, sub-s. (1A) of s. 214 of the Act provides that where on completion of the regular assessment the amount on which the interest so paid under sub-s. (1) has been reduced, the interest shall be reduced accordingly, and the excess, if any paid, shall be deemed to be tax payable by the assessee 'and the provisions of this Act shall apply. Admittedly, the net result after regular assessment as well as after giving effect to the orders of the Tribunal for asst. yrs. 1978-79 is that the assessee has not paid the tax deducted at source or advance tax more than the tax assessed. Therefore, in any case, if the interest has been paid, which is not payable under s. 214 of the Act, that can be recovered. 24. The learned counsel appearing for the assessee submits that after giving effect to the order of CIT(A) as well as the order of the Tribunal in the assessee's appeal, the tax paid by the assessee is more than the tax assessed. Therefore, the interest under s. 214 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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