Maintainability of appeal against interest under section 139(1) depends on challenging the charging provision itself, not the mere levy.

An appeal against interest charged under proviso (iii) to section 139(1) of the Income-tax Act was examined with section 246(c), on the principle that levy of interest forms part of the assessment process. The Court indicated that such an appeal is maintainable only where the grievance is that the return was not belated or that section 139(1) does not apply at all; a challenge to the mere levy of interest does not suffice. On the facts placed, the assessee's objection did not fall within those maintainable categories, so the appeal was held not to lie.

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Issues: Whether an appeal lies to the Appellate Assistant Commissioner against an order charging interest under proviso (iii) to section 139(1) of the Income-tax Act, 1961.

Analysis: The appeal was tested against section 246(c) of the Income-tax Act, 1961, read with section 143(8), in the light of the governing principle that levy of interest forms part of the assessment process. The Court noted that such a challenge would be maintainable only where the grievance was that the return was not belated or that section 139(1) did not apply at all. On the materials placed, it was not possible to hold that the assessee's challenge fell within those categories.

Conclusion: An appeal did not lie against the levy of interest under proviso (iii) to section 139(1); the question was answered in the negative and against the assessee.

Ratio Decidendi: An appeal against levy of interest under section 139(1) is maintainable only when the challenge goes to the applicability of the charging provision itself, and not against the mere levy of interest as part of the assessment process.

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