9911796707
TMI Blog1974 (2) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... of the petitioner was on October 10, 1967, as is seen recited in exhibit P-3 order for 1963-64 dated August 24, 1970. Sections 139 and 148, as they stood at the relevant time, are as follows : "139. Return of income.--(1) Every person, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax, shall furnish a return of his income or the income of such other person during the previous year in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed-- (a) in the case of every person whose total income, or the total income of any other person in respect of which he is assessable under this Act, includes any income from business or profession, before the expiry of six months from the end of the previous year, or where there is more than one previous year, from the end of the previous year which expired last before the commencement of the assessment year, or before the 30th day of June of the assessment year, whichever is later ; (b) in the case of every other person, befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice, a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed : Provided that on an application made in the prescribed manner the Income-tax Officer may, in his discretion, extend the date for the furnishing of the return, and when the date for furnishing the return, whether fixed originally or on extension, falls beyond the 30th day of September or, as the case may be, the 31st day of December of the assessment year, the provisions of sub-clause (iii) of the proviso to sub-section (1) shall apply. (3) If any person who has not been served with a notice under sub-section (2), has sustained a loss in any previous year under the head a 'Profits and gains of business or profession' or under the head 'Capital gains' and claims that the loss or any part thereof should be carried forward under sub-section (1) of section 72 or sub-section (2) of section 73, or sub-section(1) of section 74, he may furnish, within the time allowed under sub-section (1), a return of loss in the prescribed form and verified in the prescribed manner and c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duce or waive the interest payable by any person under any provision of this section." Section 148 of the Act reads : "148. Issue of notice where income has escaped assessment--(1) Before making the assessment, reassessment or recomputation under section 147, the Income-tax Officer shall serve on the assessee a notice containing all or any of the requirements which may be included in a notice under sub-section (2) of section 139 ; and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub-section. (2) The Income-tax Officer shall, before issuing any notice under this section, record his reasons for doing so." The contention of the petitioner's counsel was that the levy of interest under the impugned orders under the provisions of section 139(1) and (3) was unsustainable in law. The argument was put thus : Sections 139(1) and 139(3) have application only to cases where the assessee has filed his return within the assessment year ; and section 139(4) where such return is filed beyond the assessment year. In these cases, it was argued that sections 139(1) and (2) cannot have application at all as the retur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reassessment proceedings sanctioned by the section. What section 148 enacts is to treat the reassessment proceedings as assessment proceedings and proceed accordingly under section 139 and other provisions of the Act. So understood, we are unable to accept the argument of the counsel for the petitioner. We, therefore, hold that the levy of interest under the impugned assessment orders under the provisions of section 139 was justified and proper. The levy of penal interest under section 217 of the Act was attacked. In order to understand the argument, we may quote section 217 and also section 212, as those sections stood at the relevant time : 217. Interest Payable by assessee when no estimate made.--(1) Where, on making the regular assessment, the Income-tax Officer finds that any such person as is referred to in sub-section (3) of section 212 has not sent the estimate referred to therein, simple interest at the rate of nine per cent. per annum from the 1st day of April next following the financial year in which the advance tax was payable in accordance with the said provisions up to the date of the regular assessment shall be payable by the assessee upon the amount equal to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rm and verified in the prescribed manner." The argument was that proceedings under section 217 can be taken only against the person referred to in sub-section (3) of section 212, and that under the latter provision only a person "who has not been previously assessed by way of regular assessment under this Act or the earlier Act of 1922" is liable to be dealt with. It was, therefore, contended that, as in this case, the petitioner had been previously assessed by way of regular assessment on October 31, 1967 (as exhibit P-3 would show), the levy of penal interest by the impugned orders, all of which were subsequent to that date, was illegal and unjustified. Counsel for the revenue contended that there was a fallacy in the argument. Reading sub-clause (3) of section 212 in the light of the purpose that it was meant to serve, it was pointed out that the obligation was to send an estimate only before the 1st day of March in each financial year. Therefore, it was argued that the point of time with respect to which the officer had to judge whether the assessee had been previously assessed by way of regular assessment, was this date, viz., the 1st day of March. So viewed, it was pointed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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