Regular assessment definition limits interest levy; reassessment proceedings cannot attract interest provisions meant for regular assessment.

Regular assessment under the Income-tax Act, 1961 is confined to assessments made under sections 143 and 144; reassessment under section 147 does not fall within that statutory expression. On that construction, interest provisions applicable to regular assessment cannot be extended to reassessment proceedings completed after notice under section 148. The court therefore held that interest under sections 139(8) and 215 could not be levied in reassessment proceedings, and the impugned interest demand was quashed to that extent.

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Issues: Whether interest can be enhanced and levied in reassessment proceedings under the Income-tax Act, 1961.

Analysis: The governing principle is that "regular assessment" under section 2(40) of the Income-tax Act, 1961 refers only to assessments made under sections 143 and 144. Assessments or reassessments made under section 147 do not fall within that expression. On that construction, interest provisions applicable to regular assessment cannot be extended to reassessment proceedings. The reasoning followed the binding view that the statutory definition cannot be enlarged by interpretation to include reassessments completed after notice under section 148.

Conclusion: Interest under sections 139(8) and 215 could not be levied in reassessment proceedings under section 147. The challenge succeeded and the impugned interest demand was quashed to that extent.

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