Advance tax interest is not "relief" for reassessment purposes, limiting reopening under the income-tax law.

Interest paid by the Government under section 18A(5) of the Income-tax Act, 1922, was held not to be "relief" within section 34(1)(b) because it compensated for advance tax payment and did not reduce taxable income, profits, or gains assessed on regular assessment. The term "relief" in the reopening provision was confined to items such as exemptions or deductions granted in respect of taxable income, not to interest later adjusted in computing net tax payable. As tax, penalty, and interest were treated as distinct concepts, the reopening notice and reassessment were without jurisdiction and the appeal failed.

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Issues: Whether interest paid by the Government under section 18A(5) of the Income-tax Act, 1922, could be treated as "relief" within section 34(1)(b) so as to justify reopening of the assessment on the footing that income, profits or gains had been made the subject of excessive relief.

Analysis: Interest under section 18A(5) was payable on advance tax deposited by the assessee and was intended to compensate for the advance payment of tax. It did not reduce the tax assessed on income, profits or gains, and had no bearing on the burden of tax determined on regular assessment. The statutory use of the word "relief" in section 34(1)(b) was confined to reliefs granted in respect of taxable income under the Act, such as exemptions or deductions, and not to interest subsequently set off while working out the net amount payable. The assessment machinery also treated tax, penalty, and interest as distinct concepts, showing that interest was not part of the relief contemplated by the reopening provision.

Conclusion: Interest paid under section 18A(5) was not "relief" within section 34(1)(b), and the reopening notice and reassessment were without jurisdiction. The appeal failed and was dismissed.

Ratio Decidendi: Interest paid on advance tax under section 18A(5) of the Income-tax Act, 1922, is not relief granted in respect of taxable income and therefore cannot constitute "excessive relief" for the purpose of reopening under section 34(1)(b).

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