Mandatory interest for delayed return filing can be levied in rectification even if omitted in the original assessment.

Interest under sections 139(8) and 217 of the Income-tax Act was mandatory where the return was not filed within time and the statutory conditions for levy were satisfied. The fact that the original assessment did not charge such interest did not bar its levy when rectification proceedings later brought the omission and the assessee's taxable income to notice. The rectification could validly include the omitted interest because the liability arose by operation of law once the default in timely filing was established. The question was answered in favour of the Revenue and against the assessee.

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Issues: Whether interest under sections 139(8) and 217 of the Income-tax Act, 1961 could be charged when the assessment was rectified and the assessee's income was found taxable, despite the original assessment not levying such interest.

Analysis: The return had not been filed by the due date. Section 139(8)(a) makes interest payable where a return is furnished after the specified date or is not furnished, and section 217 similarly creates liability to pay interest in the circumstances specified by it. Once the rectification proceedings established taxable income and the default in timely filing was admitted, the liability to interest followed in law. The fact that the original assessment had not levied such interest did not prevent its charge in rectification.

Conclusion: Interest under sections 139(8) and 217 could validly be charged in rectification proceedings. The question was answered in the negative, in favour of the Revenue and against the assessee.

Ratio Decidendi: Where the statutory conditions for charging interest on delayed or non-filing of a return are satisfied, such interest is mandatory and may be levied in rectification proceedings when the omission is brought to notice.

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