Mandatory interest on advance surtax cannot be impliedly waived; silent omission in assessment is a rectifiable mistake.

Interest under section 7C of the Companies (Profits) Surtax Act, 1964 is statutorily attracted on default in advance surtax payment and does not require a separate levy order. Waiver is not presumed from silence in the assessment order; it requires a conscious decision satisfying the conditions in rule 13C of the Companies (Profits) Surtax Rules, 1964. Where the assessment records show no application of mind to waiver, omission to charge the interest is a mistake apparent from the record and can be rectified under section 13. The High Court rejected the contention of implied waiver and treated the omission as rectifiable.

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Issues: Whether omission to levy interest under section 7C of the Companies (Profits) Surtax Act, 1964 in the original assessment could be treated as a waiver by the Assessing Officer, or as a mistake apparent from the record capable of rectification under section 13 of the Act.

Analysis: Interest under section 7C is statutorily attracted on default in payment of advance surtax and does not depend on a separate order of levy. Waiver of such interest is not automatic and requires a conscious decision based on the conditions prescribed in rule 13C of the Companies (Profits) Surtax Rules, 1964. Where the assessment order is silent on interest and there is no discernible application of mind to waiver, the omission cannot be presumed to be an implied waiver. The failure to levy a statutorily payable interest component is therefore an omission apparent from the record and is amenable to rectification under section 13.

Conclusion: The omission to levy interest under section 7C in the original assessment was rectifiable under section 13 of the Companies (Profits) Surtax Act, 1964, and the contention that there had been an implied waiver was rejected.

Ratio Decidendi: Where interest is mandatorily imposed by statute and waiver depends on satisfaction of specified conditions, a silent omission to levy such interest in the assessment order is not an implied waiver but a rectifiable mistake apparent from the record.

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