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TMI Blog2024 (10) TMI 1281X X X X Extracts X X X X X X X X Extracts X X X X ..... pathi and others[ 1993 (4) TMI 1 - SUPREME COURT] wherein Hon ble the Supreme Court while following its earlier judgement rendered in the case of R.B. Shreeram Durga Prasad and Fatechand Nursing Das [ 1989 (1) TMI 4 - SUPREME COURT] thus objection raised by learned counsel for the respondents regarding non-maintainability of the present writ petition, is rejected. Whether the discretion exercised by the Settlement Commission of reducing the interest by 50% in terms of the interest chargeable u/s 234A? - We would have to examine the provisions of Section 234A of the Act for the purpose, which provides for charging of interest for defaults in furnishing return of income, interest for defaults in payment of advance tax and for interest for deferment of the advance tax, respectively. The provisions of imposing the interest is automatic, and if there is a default, interest is liable to be paid. However, by the various judgments passed Courts have taken a view that in circumstances which are beyond the control of the assessee in filing of the return in time, the interest can be waived. In the present case, the Income Tax Settlement Commission accepted the version of the petitioners that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmission has ordered to charge the interest @ 50% under Section 234-A of the Income Tax Act, 1961 (for short, the Act ), and also directed for the interest under Section 234-B of the Act for the assessment year 1989-90, and similarly, it has also imposed interest under Section 234-C, with respect to the five applicants before it. 2. Learned counsel for the petitioners submits that the Settlement Commission has fallen in error, in imposing the interest upto 50% under Section 234-A of the Act, and similarly, has erred in imposing the interest under Section 234-B and 234-C of the Act, as it has agreed with the contentions raised by the applicants/petitioners that for the assessment years 1986-87, 1987-88, 1988-89, when the re-assessment orders were issued under Section 148, no interest was chargeable under Section 139 (8), and the interest under Section 234-A could have been charged on the ground that the returns had been filed on 12.02.1991 after delay, for the Assessment Year 1989-90. It is the contention raised by learned counsel for the petitioners that the petitioners were prevented from filing the returns in time, as the copies of the seized papers were not given to the petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -C(1) for disposing off their settlement petitions filed under Section 245-D(4) of the Act and the order is passed finally under Section 245-D, which deals with all the aspects relating to the concerned assessment. It does not lie wrong for the petitioners to turn around and challenge the same on the aspects which cannot be controverted by them. She has supported the order passed by the Income Tax Settlement Commission and submits that there is no indiscretion on the part of the Settlement Commission. They have applied their mind fully to the facts of the case and reduced the interest by 50%, in terms of Section 234-A of the Act. However, complete interest has been charged under Section 234-B and similarly interest has also been charged under Section 234-C of the Act. It is pointed out that the Settlement Commission has after due deliberation, waived the interest under Section 220 (2) of the Act. Thus, she submits that there has been a complete application of mind on the part of Settlement Commission and, thus this Court ought not to interfere with the said orders. 7. Learned counsel for the respondents/Revenue further submits that insofar as the judgments cited by the petitioners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... speaking, to dissect its order and that the assessee should not be permitted to accept what is favourable to him and reject what is not. According to learned counsel, the Commission is not even required or obligated to pass a reasoned order. Be that as it may, the fact remains that it is open to the Commission to accept an amount of tax by way of settlement and to prescribe the manner in which the said amount shall be paid. It may condone the defaults and lapses on the part of the assessee and may waive interest, penalties or prosecution, where it thinks appropriate. Indeed, it would be difficult to predicate the reasons and considerations which induce the Commission to make a particular order, unless the Commission itself choses to give reasons for its order. Even if it gives reasons in a given case, the scope of enquiry in the appeal remains the same as indicated above, viz., whether it is contrary to any of the provisions of the Act. In this context, it is relevant to note that the principle of natural justice (audi alteram partem) has been incorporated in section 245D itself. The sole overall limitation upon the Commission thus appears to be that it should act in accordance wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... far as the interest chargeable under Section 234-B and 234-C are concerned, keeping in view that the advance tax was required to be paid, wherein there has been a default, in terms of the judgment passed in the case of Gulraj Engineering Construction Co., reported as [1995] 215 ITR (AT), we do not propose to waive the interest under Section 234-B and 234-C of the Act. 17. We are also not impressed by the arguments raised by learned counsel for the petitioners in terms of the circular on waiver of interest (Annexure P-6) that the interest under Section 234-B and 234-C should be waived, as depositing of advance tax has nothing to do with the seizure of the books of accounts or during the course of proceedings for search, or seizure of cash. 18. In the case of Shelly Mehta v. Commissioner of Income tax, Central Circle, Ludhiana and another, this Court has taken a view that the cash seized during the seizure cannot be a ground for waiver of advance tax or payment of tax for the subsequent year. In view thereto, we do not accept the contentions made by counsel for the petitioners and the present writ petition is allowed in part. Pending miscellaneous application(s), if any, also stand d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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