9911796707
TMI Blog1988 (10) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... fore the Commissioner of Income-tax, West Bengal-1, Calcutta, inter alia, stating that the petitioner expected that the advance tax payable by it was likely to exceed the advance tax demanded and the Commissioner was requested to extend the time to file the estimate by 30 days immediately following the last date of the previous year, i.e., up to April 30, 1974, in terms of the proviso to section 212(3A) of the Act. The petitioner asked for such extension of time as, according to the petitioner having regard to the nature of the business carried on by the petitioner, it was difficult for the petitioner to furnish the estimate required to be furnished in accordance with the provisions of the Act on or before the date on which the last instalment of advance tax was due. By an order dated March 15, 1974, the Commissioner extended the time as prayed for and it was further directed by the said order that the petitioner would pay Rs. 7,00,000 more towards advance tax by March 25, 1974. The petitioner duly paid the said sum of Rs. 7,00,000 on or about April 26, 1974; the petitioner filed an estimate for the assessment year, i.e., 1974-75, and the estimate of the petitioner was for the sum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in making the said order under appeal relied on the instruction of the Board and concluded that interest under section 215 of the Act was attributable to the addition on account of provision towards gratuity and had to be waived but he had not applied his mind to the remaining portion of the interest, that is, interest not attributable towards gratuity. The Tribunal, therefore, concluded that the appellate authority could not give a decision that interest under section 215 of the Act could not be charged at all. By the order dated February 2, 1982, which is the order impugned in these proceedings, the Income-tax Officer passed an order giving effect to the said order dated April 30, 1981, passed by the Income-tax Appellate Tribunal and the concerned Income-tax Officer charged interest under section 215 of the Act in respect of a sum of Rs. 17,11,410 as, according to him, it was not payment of advance tax within the financial year as stipulated in section 215 of the Act. As stated hereinabove, the petitioner made an application under section 264 of the Act before the Commissioner, inter alia, praying that the Income-tax Officer should be directed not to charge interest on the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f advance tax within the "financial year" as stipulated under the Act. It has been argued by Mr. Bajoria that Chapter XVII of the Act deals with collection and recovery of tax and sections 207 to 219 in the said Chapter deal with the payment of advance tax. Mr. Bajoria argues that in terms of section 207, the tax shall be payable in advance during any "financial year" in accordance with the provisions of sections 208 to 219 (both inclusive) in respect of the total income of the assessee which would be chargeable to tax for the assessment year immediately following the financial year. It is submitted by Mr. Bajoria that section 212 including its sub-sections particulary (3A) read with the proviso is one of the sections between sections 208 and 219, Mr. Bajoria has also referred to section 211 of the Act, which, filter alia, provides for due dates in three equal instalments, namely, September 15, December 15 and March 15, by which instalments the assessee who is liable to pay should pay the advance tax during the relevant financial year. It is the argument of Mr. Bajoria that under section 207 of the Act, the tax shall be payable in advance during any financial year In accordance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Bajoria has also relied on the decision of the Rajasthan High Court in CIT v. Jaipur Udyog Ltd. [1987] 167 ITR 306 and the decision of the Kerala High Court in CIT v. Nenmony Investments and Agencies Ltd. [1978] 113 ITR 354 in support of his contention that the amount paid beyond the financial year but within the time allowed would be treated as payment of advance tax and due credit should be given for such payment of advance tax within the time allowed under the Act but beyond the financial year. Mr. Bajoria has also submitted as would appear from the assessment order that the income-tax authority has given due credit for the advance tax so paid by the petitioner within the time as extended by the Commissioner under the terms of the proviso to sub-section (3A) of section 212 but has levied interest on the sum estimated by the petitioner on the ground that the advance tax has not been paid within the financial year as stipulated in section 215 of the Act. Mr. Mihir Bhattacharyya, learned counsel for the Revenue, has argued that if the expression "financial year" in section 215 was intended to include the extended time as stipulated in the proviso to sub-section (3A) of sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation, the short point that has to be decided is, if any assessee has paid the advance tax as estimated by the assessee within the period stipulated in the proviso to sub-section (3A) of section 212 of the Act, then whether the assessee is liable to pay interest levied under section 215 of the Act. It would appear that under section 207, it is provided that the tax shall be payable in advance during any financial year in accordance with the provisions of sections 208 to 219 (both inclusive). Under section 208 of the Act, the assessee is obliged to pay advance tax during the financial year. Section 209 of the Act provides for computation of advance tax and section 209A of the Act provides for computation and payment of advance tax by the assessee, section 211 of the Act allows an assessee to pay advance tax by instalments on or before the due dates specified in section 211 of the Act. Section 212 of the Act allows the assessee to make an estimate and furnish such estimate to the tax authorities. Much reliance has been placed by the petitioner on subsection (3A) read with the proviso thereto of section 212 of the Act. It is provided under sub-section (3A) that in the case of any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on or before the date as so extended, the amount by which the amount of advance tax already paid by him falls short of the advance tax payable in accordance with his estimate. Therefore, in terms of the proviso, the Commissioner in certain circumstances has power to extend the time for furnishing the estimate of advance tax and payment thereof, but such extension should not be more than 30 days immediately following the last date of the previous year in respect of the assessee's business. It is not in dispute that in the present case, the assessee has paid Rs. 3,36,090 as demanded under section 210 of the Act. It is also not in dispute that the petitioner has furnished the estimate of advance tax within the time as extended by the Commissioner in terms of the proviso to sub section (3A) of section 212 of the Act and also paid the advance tax in accordance with such estimate within the said period. . It is also not in dispute that the respondent has given due credit for the advance tax paid by the petitioner. Now, the question here is whether, in such facts and circumstances, the petitioner is obliged to pay interest as sought to be levied by the respondent under section 215 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the last date of the previous year in the proviso to sub-section (3A) of section 212 of the Act would be meaningless. Further, if it is contended that if the advance tax paid Within such time as extended in terms of the proviso to Sub-section (3A) of section 212 of the Act would be treated as payment of advance tax and due credit be given therefor, but for the purpose of section 215 the authority concerned would have power to levy interest for not paying the advance tax within the financial year then the benefit given by the proviso to sub-section (3A) of section 212 would be meaningless and an empty benefit. I find it difficult to persuade myself to accept such construction of section. 215 as is sought to be given by the Revenue that the Revenue would be empowered to levy interest under section 215 of the Act if the estimated advance tax is not paid within the financial year but is paid within the extended time within the meaning of the proviso to sub-section (3A) of section 212 of the Act. In my opinion, if such construction is given to the expression "financial year" then the provision giving benefit to an assessee to furnish the estimate of advance tax and making paymen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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