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TMI Blog2009 (8) TMI 1276X X X X Extracts X X X X X X X X Extracts X X X X ..... al gains accrued to the Assessee in the months of May, 1995 and July, 1995. The assessment in the case was completed under Section 143(3)of the Act and the Assessing Officer charged interest under Section 234C at Rs. 94,294. The Assessee filed an application for rectification under Section 154 of the Act alleging that interest under Section 234C of the Act was wrongly charged at Rs. 94,294 as against the interest chargeable at Nil. The rectification application was rejected by the Assessing Officer against which the appeal was filed before the CIT(A). The stand of the revenue is that advance tax arising on income from long-term capital gain is to be paid as part of succeeding advance tax instalments. However, the claim of the Assessee is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 308:172 Taxman 386. The learned D.R. for the revenue pointed out that the proviso to Section 234C was introduced and the same is not retrospective amendment. It was further pointed out by the learned D.R. for the revenue that Finance Act clearly stipulated that the said amendment would take effect from assessment year 1996-97. 4. We have heard the rival submissions and perused the records. Under the scheme of taxation provided in the Income-tax Act, a person is responsible to pay tax in advance during the financial year to which the income relates. The statute provides that in case of Assessee being a company, the advance tax, by the Assessee of its own accord or in pursuance to the order of the Assessing Officer is to be paid in fou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 234C is chargeable. However, by Finance (No. 2) Act, 1996, it has been provided that such taxes are to be paid as part of remaining instalment of advance tax which are due or in case no instalment is due by 31st day of the March of financial year. In other words, the Assessee is to treat such income arising on capital gains or income referred to under Section 2(24)(ix) of the Act as part of its total income from the date on which such gain or income arises and the tax due on such income is to be paid in instalment which are remaining after the date of gain/income arising to the Assessee or in all such cases where no instalment is due by 31st day of March of the financial year. The Finance (No. 2) Act, 1996 by substituting the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icable to declaratory statutes. The Court further held that : ...if a new Act is 'to explain' an earlier Act, it would be without object unless construed retrospectively. An explanatory Act is generally passed to supply an obvious omission or to clear up doubts as to the meaning of the previous Act. It is well-settled that if a statute is curative or merely declaratory of the previous law retrospective operation is generally intended. 7. The Court in Gold Coin Health Food (P.) Ltd.'s case (supra) noted in Virtual Soft Systems Ltd. v. CIT (2007) 9 SCC 665, it was observed that : even if the statute does contain a statement to the effect that the amendment is clarificatory or declaratory, that is not the end of the matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt in Zile Singh's case (supra) and Podar Cement (P.) Ltd.'s case (supra) which in turn have been relied upon in the case of Gold Coin Health Food (P.) Ltd. (supra), we are of the view that the amendment in proviso to Section 234C is clarificatory in nature and the same is to be applied retrospectively. The amendment provided in proviso to Section 234C is to explain the earlier Act of payment of advance tax in instalments and has to be applied retrospectively. The Assessee before us has paid taxes as part of instalments due after the date of sale of asset and as such is not in default as stipulated under Section 234C of the Act. Thus, no interest is chargeable under Section 234C of the Act. Thus, the ground of appeal raised by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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