9911796707
TMI Blog1998 (4) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... to complete the assessment and purchase peace with the Department, the petitioner filed a settlement petition to the Commissioner of Income-tax, Central-I, Madras 34. After having discussions, the Commissioner of Income-tax estimated the income of the petitioner and gave direction to the Income-tax Officer to complete the assessment as follows : Rs. 1984-85 50,00,000 1985-86 60,00,000 The petitioner had filed his return of income on March 26, 1986, for the assessment year 1985-86 admitting a total income of Rs. 60,04,050 in pursuance of the settlement arrived at with the Commissioner of Income-tax, Central-I, by his proceedings in C. No. 51544/1(3) of 1985-86/Central-I dated March 25, 1986. The Income-tax Officer completed the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner and the Department at the time of the settlement that the interest should be waived in full, if returns and tax are paid in pursuance of the settlement. But, however, the interest was levied and the same is questioned in this action. The petitioner estimated his income on the basis of the books of account and also paid the advance tax accordingly. But, the petitioner filed the return on the basis of the income arrived at the settlement. That in the said circumstances, the petitioner could not have anticipated that there was lapse on the part of the petitioner in not having paid the advance tax and in respect of the waiver of interest under section 139(8). The petitioner also sent petitions periodically, seeking time till Febru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid order, the petitioner filed the present writ petitions. I heard the respective submissions of the learned advocates for the petitioner and also the respondent. The learned advocate for the petitioner has submitted that at the time when the petitioner filed the return, the amnesty scheme formulated by the Government of India was invoked. As such, the petitioner is entitled to have the waiver of interest. The amended scheme should have been extended to the petitioner's case. But, the respondent totally turned down the request of the petitioner and passed an order, which is illegal. The petitioner further submitted that he could not anticipate the income-tax and hence, the petitioner was not in a position to anticipate the tax payabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... leviable under section 215, under rule. 40 of the Income-tax Rules, and the interest leviable under section 139, under rule 117A of the Income-tax Rules. It, therefore, follows that, before the charge of interest, the Income-tax Officer should give an opportunity to the assessee to show cause why interest should not be levied. Before actually charging the interest, the Income-tax Officer should consider the representations made by the assessee and if justification exists either for waiver or for reduction of interest, he should do so even before passing a formal order. It would not be proper for the Income-tax Officer to levy interest as a matter of course driving an assessee to file representations for waiver or for reduction of interest, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uestioning in this writ petition and that, therefore, the writ petitions are liable to be dismissed. To support and sustain his submissions, he placed reliance upon the judgment reported in Smt. Harbans Kaur v. CWT [1997] 224 ITR 418 (SC). But, in the very same judgment, it has been held that : "It is understood in clear terms that the said discretion in the Income-tax Act is to be exercised in a reasonable and fair manner. The decision of the Bombay High Court in Purshottam Thackersey v. K. N. Anantarama Ayyar, CIT (No. 2) [1985] 154 ITR 438, cited before us, only shows that the order of the Commissioner declining to waive the penalty without advancing any reason whatsoever cannot be supported and the matter was remitted to the Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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