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TMI Blog2016 (11) TMI 1763X X X X Extracts X X X X X X X X Extracts X X X X ..... on 234 C. While this interest was levied, for the assessment years 2004-05 and 2005-06, during the course of appeal effect proceedings, this interest was levied, for the assessment year 2009-10, during the regular assessment proceedings. 2. This issue is no longer res integra. As far as back as in 2003, a coordinate bench of this Tribunal, in the case of Fisons Plc Vs DCIT [(2004) 91 ITD 450 (Mum)], a coordinate bench of the Tribunal has held as follows: 8. Sec. 209(1)(d) of the Act provides that while computing advance tax payable by the assessee, the income-tax calculated on the estimated income of the assessee is to be reduced by "the amount of income-tax which would be deductible or collectible at source during the said financial year under any provision of this Act from any income (as computed before allowing any deductions admissible under this Act) which has been taken into account in computing the current income or, as the case may be, the total income aforesaid and the amount of income-tax as so reduced shall be the advance-tax payable". In plain words, the amount of tax deductible at source is to be reduced from the estimated tax liability, for the purpose of computing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce which is to follow is that the interest becomes payable under s. 234B of the Act. But in the instant case, the provisions of s. 234B of the Act would not be attracted at all. 7. Sec. 2(1) of the Act defines "advance tax" to mean the advance tax payable in accordance with the provisions of Chapter XVII-C of the Act. These provisions are contained from s. 207 onwards. Sec. 209 falls under this chapter. Sub-s. (1) thereof deals with four situations under which the advance tax payable by the assessee is to be computed. Admittedly, these cases do not concern with cls. (a) to (c). Clause (d) of sub-s. (1) of s. 209, which is relevant reads as under : "(d) The income-tax calculated under cl. (a) or cl. (b) or cl. (c) shall, in each case, be reduced by the amount of income-tax which would be deductible or collectible at source during the said financial year under any provision of this Act from any income (as computed before allowing any deductions admissible under this Act) which has been taken into account in computing the current income or, as the case may be, the total income aforesaid; and the amount of income-tax as so reduced shall be the advance tax payable." 8. This cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the learned Departmental Representative, and Their Lordships were pleased to clarify that the decision in the case of Alactel Lucent (supra) was on its own peculiar facts and it cannot be of universal application. Their Lordships, inter alia, observed as follows: 19. Alcatel Lucent (supra), in any event, can be distinguished on the ground that the Court was persuaded to confirm the levy of interest under Section 234B, only on account of the equities that needed to be balanced in those peculiar facts, in favour of taxability. This is evident from the following words of the Court: "26. It further seems to us inequitable that the assessee, who accepted the tax liability after initially denying it, should be permitted to shift the responsibility to the Indian payers for not deducting the tax at source from the remittances, after leading them to believe that no tax was deductible. The assessee must take responsibility for its volte face. Once liability to tax is accepted, all consequences follow; they cannot be avoided. After having accepted the liability to tax at the first appellate stage, it is unfair on the part of the assessee to invoke section 201 and point fingers at the In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he aforesaid decision of Hon'ble Delhi High Court. Yet, Their Lordships held the issue unequivocally in favour of the assessee, and against application of interest under section 234 B. The principle on the basis of which this issue is decided in favour of the assessee, i.e. working of section 209(1)(d), has nothing to do with the ratio of decision in the case of Anjum Ghaswala (supra) which holds that levy of interest is mandatory. The levy in mandatory in the cases in which the levy of interest is workable, but when we apply the formula in section 209(1)(d), the amount on which interest can be levied is reduced to nil as the amounts on which taxes are deductible are to be reduced from the total amounts and the taxes are deductible from entire amounts. Nothing thus survives for the levy of interest under section 234 B or, for that purpose, under section 234 C. 7. There is one more point raised by the learned Departmental to justify the upholding of levy of interest under section 234B and 234 C and that point is that the deletion of this interest is sought by way of petition for rectification of mistake, and since the matter of capable of two views being taken, it cannot be subject ..... X X X X Extracts X X X X X X X X Extracts X X X X
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