Court excludes specific period for interest calculation, directs reassessment. Appellant wins appeal, interest adjustments ordered.

The court ruled in favor of the appellant, excluding the period from 24.05.2001 to 03.01.2002 for interest computation. The Assessing Officer was directed to recompute the interest accordingly. The appeal was allowed, and the interest for the delay attributable to the revenue was to be excluded. The Assessing Officer was instructed to adjust the interest demand based on the revised computation. No order as to costs.

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Issues Involved:
1. Justification of charging interest for the delay attributable to the revenue in supplying copies of accounts and relevant records and statements.

Detailed Analysis:

1. Justification of Charging Interest for Delay Attributable to Revenue:
The appellant challenged the order of the Income Tax Appellate Tribunal (Tribunal) which confirmed the charging of interest for the period of delay in filing the return of income, attributing the delay to the revenue's failure to supply necessary documents and records.

Facts Leading to the Appeal:
- A search and seizure operation took place on 04.08.2000, resulting in the seizure of books of account, documents, and cash.
- A notice under Section 158-BC was issued on 17.04.2001, requiring the appellant to file a return for the block period by 26.05.2001.
- The appellant requested copies of the seized documents and statements on 09.05.2001 and 24.05.2001, but these were not furnished.
- Partial inspection of the documents was given on 03.01.2002.
- The appellant filed the return on 26.02.2002, declaring an estimated income and requesting adjustment of the tax payable against the seized cash.
- The Assessing Officer determined the total undisclosed income and charged interest for the delay in filing the return.

Arguments by the Appellant:
- The delay in filing the return was due to the revenue's failure to provide the necessary documents and inspection in a timely manner.
- The return was filed on an estimated basis after the inspection on 03.01.2002.
- The seized amount of Rs. 25,00,000/- should offset the tax liability, negating the need for compensatory interest.

Arguments by the Revenue:
- The interest under Section 158-BFA(1) is mandatory and non-discretionary.
- The seized amount could not be adjusted against the tax liability until the assessment order was passed.

Court's Analysis:
- Section 158-BFA(1) mandates interest for late filing of the return based on the tax determined under Section 158BC(c).
- The seized amount cannot be adjusted before the tax determination.
- The delay in filing the return was attributed to the revenue's late provision of inspection on 03.01.2002.
- The return was filed based on the inspection, indicating that the delay was not due to the appellant's fault.
- The court emphasized equitable construction, stating that the taxpayer should not suffer due to the revenue's negligence.

Precedents and Legal Interpretations:
- The court referred to the Delhi High Court's decision in *Commissioner of Income-tax vs. Mesco Airlines Ltd.* and the Karnataka High Court's decision in *Commissioner of Income Tax vs. B. Nagendra Baliga*, which supported excluding the delay attributable to the revenue.
- The court distinguished these cases from others where the delay was not attributable to the revenue.

Conclusion:
- The court ruled in favor of the appellant, excluding the period from 24.05.2001 to 03.01.2002 for interest computation.
- The Assessing Officer was directed to recompute the interest accordingly.

Final Judgment:
- The appeal was allowed, and the interest for the delay attributable to the revenue was to be excluded.
- The Assessing Officer was instructed to adjust the interest demand based on the revised computation.
- No order as to costs.

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