Tribunal directs reassessment of interest levy based on actual advance tax The tribunal allowed the assessee's appeal for statistical purposes, directing the Assessing Officer to verify the actual advance tax paid and reconsider ...
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Tribunal directs reassessment of interest levy based on actual advance tax
The tribunal allowed the assessee's appeal for statistical purposes, directing the Assessing Officer to verify the actual advance tax paid and reconsider the levy of interest under section 234B based on the correctness of the claim. The tribunal emphasized the importance of verifying the advance tax amount and providing the assessee with an opportunity to be heard before making a decision on the interest levy.
Issues: 1. Short grant of credit of advance tax. 2. Challenge to levy of interest under section 234B of the Act.
Short Grant of Credit of Advance Tax: The appeal was against an assessment order under the Income Tax Act, 1961 for the assessment year 2014-15. The primary issue was the short grant of credit for advance tax. The Assessing Officer had granted credit for advance tax amounting to Rs. 33,60,13,160, which was less than the actual amount paid by the assessee, resulting in a shortfall of Rs. 10,46,203. The assessee had filed an application for rectification under section 154 of the Act, but no decision had been made. The tribunal directed the Assessing Officer to verify the actual advance tax paid by the assessee and grant appropriate credit, allowing this ground for statistical purposes.
Challenge to Levy of Interest under Section 234B of the Act: The second ground of appeal was the challenge to the levy of interest amounting to Rs. 5,11,89,170 under section 234B of the Act. The assessee claimed that a refund of Rs. 5,22,35,370 was due, and as the advance tax paid exceeded 90% of the tax liability, no interest under section 234B should be charged. The Dispute Resolution Panel had deleted an addition made by the Assessing Officer, accepting the income returned by the assessee. Therefore, the tribunal found no basis for the levy of interest under section 234B if the claim of advance tax payment was correct. The tribunal directed the Assessing Officer to verify the claim and decide the issue after providing the assessee with an opportunity to be heard, allowing this ground for statistical purposes.
In conclusion, the tribunal allowed the assessee's appeal for statistical purposes, emphasizing the need for the Assessing Officer to verify the actual advance tax paid and reconsider the levy of interest under section 234B based on the correctness of the claim.
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