1979 (2) TMI 67

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..... e assessment form and the demand notice a sum of Rs. 2,658 was shown as payable as interest under s. 139(1) of the Act for delay in submission of returns. Subsequently, the ITO served upon the assessee a notice for rectification of the assessment order under s. 154. He wanted to add a sum of Rs. 10,074 on account of interest on the footing that the interest charged originally was by mistake wrongly calculated. The assessee filed objections, which were repelled and the assessment order was suitably rectified. The assessee went up in appeal but failed. He then approached the Tribunal, which also repelled his submissions and dismissed the appeal. Mr. Gulati, learned counsel for the assessee, has submitted that it is well settled that for p .....

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..... ax Reference No. 618 of 1974 (CIT v. Tikam Chand Agarwal, decided on August 25, 1978 since reported in [1979] 119 ITR 248 (All)) is that interest is chargeable under these circumstances. Mr. Gulati then submitted that in point of law no interest was chargeable and hence the ITO had no jurisdiction to initiate proceedings for charging interest by way of rectification. As already said, this court's view is that in the circumstances the interest is chargeable. Therefore, the ITO had jurisdiction to charge interest. This question, however, is not very material because the ITO is not trying to charge interest for the first time by way of rectification; he had already charged it. He is now merely trying to rectify a computational error. It wa .....

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..... exercise the discretion of waiver or reduction of interest. The error was of a clerical nature. It cannot, hence, be said that in the circumstances the officer had waived or reduced the interest payable by the assessee. In our opinion, this finding of fact is not vitiated by any error of law. In A. H. Wheeler Co. P. Ltd. v. ITO [1964] 51 ITR 92 (All), it was held that even assuming that the omission to reduce the super-tax rebate was deliberate, if that view was manifestly wrong in law, the ITO had jurisdiction to rectify the assessment. This shows that even if such a mistake was deliberate, since the interest was chargeable according to the statutory provisions, it could be rectified. In the result, we answer the question referred to .....

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