9911796707
TMI Blog1980 (1) TMI 75X X X X Extracts X X X X X X X X Extracts X X X X ..... ear 1975-76, the corresponding accounting year being Samvat year 2030. The order of assessment in respect of the assessment year 1975-76 was passed on October 3, 1977, and it appears that before the end of the financial year in question, that is, before 31st March, 1975, the petitioner had paid advance payments of tax. He had paid Rs. 27,445 on June 19, 1974, and a further sum of Rs. 27,450 on September 20, 1974, making an aggregate amount of Rs. 54,895. Tax was assessed in the course of the assessment proceedings for the assessment year 1975-76 came to much less and an amount of Rs. 30,015 was payable by the incometax authorities by way of refund so far as payment of advance tax was concerned. However, at the time of passing the order of refund, the ITO stated: " No interest under section 214 granted as advance tax instalments paid after due dates. " The petitioner wrote to the ITO on November 16, 1977, stating that a sum of Rs. 9,005 by way of interest was also payable to the petitioner under s. 214 of the I.T. Act and requested the respondent to pay the same. By his letter dated December 17, 1977, a copy of which is Ex. D to the petition, the respondent, the ITO, observed: " For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... computed after the end of the financial year and when tax is assessed, the assessment may take the form of provisional assessment or final assessment but until tax is assessed, except in cases falling under the provisions regarding advance tax or the provisions of s. 140A regarding self-assessment of tax, there is no liability to pay tax other than tax in pursuance of an order of assessment, either provisional or final. Under section 211: " (1) Subject to the provisions of this section and of sections 209A and 212, advance tax shall be payable in three equal instalments on the following dates during the financial year, namely : (i) the 15th day of June, the 15th day of September and the 15th day of December ...... " In the case of some assessees tax may be paid on 15th day of September, 15th day of December and the 15th day of March. Under sub-s. (2) of s. 211 " If the notice of demand issued under section 156 in pursuance of the order under section 210 is served after any of the dates on which the instalments specified therein are payable, the advance tax shall be payable in equal instalments on each of such of those dates as fall after the date of the service of the notice o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... next following the financial year in which the advance tax was payable in accordance with section 212(3A), there is an inherent indication under section 217(1A) itself that if any tax or advance tax is paid before the 1st day of April next following the financial year in which the advance tax was payable, that tax must be given credit for in calculating the amount of interest. Since in the instant case though estimates under section 212(3A) were filed late and, consequently, the advance tax payable in accordance with those estimates was paid late, and the tax was paid before the 1st day of April next following the financial year in which the advance tax was payable in accordance with section 212(3A), interest under section 217(1A) cannot be charged and could not have been charged without giving credit to the assessee concerned for the payments so made. It must be emphasised that for the purposes of section 215(2) which has to be given effect to while calculating interest under section 217(1A) it is tax paid which matters and not advance tax paid. Advance tax undoubtedly means advance tax payable in advance in accordance with the provisions of sections 208 and 219. Mr. G. N. Desai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d have clearly stated so. It is true that in Bharat Textile Works' case [1978] 114 ITR 28 (Guj), the Division Bench accepted the contention of learned counsel appearing for the revenue that tax which is not paid in accordance with the provisions of s. 212(3A) is not advance tax for the purposes of any of the provisions of ss. 208 to 219 and, therefore, in that particular case is on the word " paid " in that passage occurring at page 35 of the report. The payability of the advance tax is different from the actual payment of advance tax. Tax payable in accordance with the provisions of ss. 208 to 219 is advance tax for the purposes of that particular group of sections and for the purposes of ss. 207 to 219, both inclusive. If tax becomes payable in the sense that liability to pay advance tax is incurred there is provision in ss. 208 to 219 about the liability. Under s. 211, instalments of advance tax are to be paid in a particular manner laid down in that section but we have pointed out earlier that even looking to the provisions of sub-s. (2) of s. 211 there is no special sanctity about the date set oat in s. 211. All that the substance of advance tax requires is that before the en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... instalments of advance tax over the tax determined in the course of the regular assessment. Interest is not even payable on the entire amount of the aggregate of instalments but only on the excess of the advance tax over the regular tax assessed in regular assessment proceedings. In view of the language used in s. 214 particularly with reference to the 1st day of April and not with reference to the dates on which the instalments are actually paid by the assessee, it is clear that what the legislature intended to do is to provide that irrespective of the dates on which instalments of advance tax are paid, interest will be payable if the entire amount of advance tax which was paid up in the course of the financial year exceeds the amount of tax determined on regular assessment. If these two conditions are satisfied interest must be paid to the assessee. The further requirement which the revenue wants us to read, namely, the third condition which it also wants us to read in s. 214, namely, that instalments of advance tax must have been paid on or before the due dates mentioned in s. 211 for the payment of instalments, cannot be read looking to the language of s. 214. Looking to the pu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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