Interpretation of interest liability under sections 217(1) and 217(1A) required reference of a substantial question of law.

Interpretation of the charging of interest under sections 217(1) and 217(1A) depended on the effect of the omission of section 209A and the assessee's estimate under section 209A(1) for assessment year 1988-89. The High Court treated the issue as a referable question of law, holding that it was not self-evident and required judicial consideration. The Tribunal was therefore directed to state a case and refer the question to the Court under section 256(2).

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Issues: Whether the proposed question of law arising from the charging of interest under sections 217(1) and 217(1A), in the context of the omission of section 209A and the assessee's estimate under section 209A(1), was a referable question requiring a statement of case under section 256(2).

Analysis: The matter turned on interpretation of the relevant statutory provisions and the effect of the omission of section 209A with effect from 1 April 1988 on the assessee's obligation to furnish estimates for the assessment year 1988-89. The view that the answer was self-evident was rejected, as the issue required judicial consideration.

Conclusion: The application was allowed and the Tribunal was directed to refer the question of law to the Court.

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