Interest under section 139(8): High Court directed reference on whether rectification and revised income created an enhancement issue.

The Delhi High Court considered whether the Tribunal was right in refusing to refer a question on enhancement of interest levied under section 139(8) after rectification under section 154 and a revised assessed income. The dispute concerned the effect of the original interest levy, later appellate and rectification orders, and the Revenue's argument that no real enhancement arose because the final interest remained below the amount originally levied. Treating the matter as a pure question of law, the Court found the issue not self-evident on the existing record and directed the Tribunal to state the case and refer the formulated question of law.

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Issues: Whether the Tribunal was justified in declining to refer the question concerning increase of interest levied under section 139(8) of the Income-tax Act, 1961, after an order under section 154 and a consequent revision in the assessed income.

Analysis: The dispute turned on the interaction between the original levy of interest for delayed return filing, the subsequent appellate and rectification orders, and the Revenue's contention that there was no actual enhancement because the interest ultimately payable remained below the amount originally levied. The Court treated the matter as involving a pure question of law and held that the answer was not self-evident on the existing material.

Outcome: The Tribunal was directed to state the case and refer the formulated question of law to the Court.

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