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TMI Blog1987 (11) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... hereas he ought to have filed the same on or before June 30, 1969. It was his first year of business. His accounting year ended on September 30, 1968. He filed an estimate of advance tax and paid advance tax of Rs. 12,940 on February 26, 1969. Proceedings were taken against the assessee under section 271(1)(a) for late filing of the return and penalty was levied. The only question arising herein is, whether the advance tax paid by the assessee should not be deducted from out of the tax determined to be payable, called " assessed tax ", for the purpose of calculating the penalty. Under section 271(1)(a), penalty can be levied for failure to furnish the return of income within the time allowed. The measure of such penalty is " 2% of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax paid during any financial year exceeds the amount of tax determined on regular assessment, interest shall be payable by the Central Government to the assessee on such excess amount from the 1st day of April next following the relevant financial year to the date of the regular assessment for the said assessment year. Similarly, section 215 provides that where during any financial year, the assessee has paid advance tax which is less than 75% of the assessed tax, interest at the prescribed rate shall be chargeable up to the date of the regular assessment on such advance amount. Where, however, no advance tax is paid on the prescribed dates, he will be treated as a defaulter and he will be liable to the levy of penalty under section 221. Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not filed within the prescribed period. For such delay or default, as the case may be, penalty is levied and this penalty is calculated on the basis of the tax assessed. But the tax deducted at source and tax paid by way of advance are deducted from out of the tax assessed for the purpose of calculating the penalty. Having regard to this context, it would be reasonable to hold that all the tax which is paid as advance tax during the relevant financial year should be deducted. All such amounts should be treated as advance tax paid under Chapter XVII-C for the purpose of the Explanation to section 271(1)(a). It would not be reasonable to say that any instalment of advance tax not paid on or before the prescribed date but paid after the due da ..... X X X X Extracts X X X X X X X X Extracts X X X X
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