1992 (11) TMI 78

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..... tal loss stood reduced to Rs. 81,01,30,511. By some inexplicable logic the Department has proceeded to levy the additional tax leviable under section 143(lA)(a), sub-clause (i). For convenience, section 143(1A) of the Income-tax Act is reproduced hereunder : " 143. (lA)(a) Where, in the case of any person, the total income as a result of the adjustments made under the first proviso to clause (a) of sub-section (1), exceeds the total income declared in the return by any amount, the Assessing Officer shall, (i) further increase the amount of tax payable under sub-section (1) by an additional income-tax calculated at the rate of twenty per cent. of the tax payable on such excess amount and specify the additional income-tax in the intimation .....

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..... the total income declared by him after adjustments by any amount, the Assessing Officer would be entitled to increase the amount of tax payable tinder sub-section (1) by an additional income-tax calculated at the rate of 20 per cent. of the tax payable on such excess amount. This would obviously mean that there has to be an increase in the income-tax payable as a result of such adjustments and only in that situation the tax payable has to be further enhanced by sum equal to 20 per cent. of such increased tax liability. In the present case, what has happened is that as a consequence of adjustment the total loss returned by the assessee has come down by more than Rs. 6 crores, but even after such reduction on account of adjustment the said .....

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..... ss tax had earlier been deposited on the basis of certain estimated profits and the profits stood reduced after adjustments. The Department would be fully justified in resorting to this levy in case the adjustments result in changing a return from negative to positive return showing loss to one showing profit. That is not the case here. My attention has been drawn to the case of Modi Cement Ltd. v. Union of India [1992] 193 ITR 91 (Delhi) decided by a Division Bench of this court expressing a similar opinion. At this stage, Mr. Rajendra has also brought to my notice a judgment of a Division Bench of this court in C.W. No. 2123 of 1992, decided on July 7, 1992, International Research Park Laboratories v. Union of India [1993] 200 ITR 5 .....

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