Challenge to interest under section 139(8) can be raised in a valid appeal on other grounds; refusal to entertain it was erroneous.

An assessee who has filed a valid appeal on other grounds may also object to the charge of interest under section 139(8) in the same appeal, even though no separate appeal lies against interest alone. Following the later High Court view over earlier conflicting authorities, the Tribunal held that the objection was maintainable because the appeal was already competent on the disallowance issue. The appellate authority therefore erred in refusing to entertain the ground, and the matter was remitted for decision on merits after hearing both sides.

---

---

Issues: Whether, in an appeal filed on other grounds, the assessee could also challenge the charge of interest under section 139(8) of the Income-tax Act, 1961, and whether the appellate authority was justified in refusing to entertain that ground.

Analysis: In the absence of any binding ruling of the jurisdictional High Court, the Tribunal preferred the later High Court decision which, after considering the earlier conflicting authorities, held that although no appeal lies against the charge of interest alone, an assessee may raise an objection to such charge in an appeal otherwise properly filed. Since the assessee had already appealed against the disallowance of travelling expenses, the objection to interest under section 139(8) was maintainable in the same appeal. The appellate authority therefore erred in declining to examine the ground.

Conclusion: The objection to interest under section 139(8) was held to be entertainable in the appeal, and the matter was sent back to the appellate authority for decision on merits in accordance with law after hearing both sides.

---