Rectification for late-filing interest is permitted when non-levy is an apparent record error and waiver conditions are unmet

Income-tax Officer's failure to charge interest for late filing was held to be rectifiable where the return was filed after the maximum extended date and the proviso to section 139(1) made interest mandatory. The limited power to reduce or waive interest under section 139(8) and rule 117A applied only if the prescribed conditions, including any necessary prior approval, were satisfied; those conditions were not shown here. The original non-levy was therefore not a conscious waiver but a mistake apparent from the record, and rectification under section 154 was permitted to levy the interest.

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Issues: Whether the Income-tax Officer could invoke rectification powers to levy interest for late filing of the return under the relevant proviso to section 139(1), and whether the omission to charge such interest in the original assessment was a mistake apparent from the record.

Analysis: The return was filed after the maximum extended date, and the proviso to section 139(1) made levy of interest obligatory in such a case. Any power to reduce or waive the interest under section 139(8) and rule 117A was only a limited power, subject to the prescribed conditions and, where applicable, prior approval. On the facts, those conditions were not shown to have been satisfied, and the original non-levy could not be treated as a conscious waiver. The omission therefore constituted an error apparent from the record, permitting action under section 154.

Conclusion: The Income-tax Officer had jurisdiction to rectify the assessment and levy the interest, and the question was answered against the assessee and in favour of the Revenue.

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