Seized fixed deposits can be adjusted against self assessment tax from request date despite belated return filing

The ITAT Delhi held that the assessee was entitled to adjustment of seized fixed deposits against self assessment tax liability from the date of request (11.04.2012), despite filing belated return on 26.03.2013. The tribunal found that any tax payment after the financial year constitutes advance payment of self assessment tax, irrespective of return filing date. The AO was directed to adjust the seized fixed deposit receipts against self assessment tax from 11.04.2012 and recompute interest under section 234B accordingly, while removing the earlier adjustment made towards regular tax arrears.

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Issues involved: Appeal against order of Commissioner of Income Tax (Appeals) regarding adjustment of seized fixed deposits against tax liability for AY 2012-13 and interest calculation u/s 234A & 234B.

Summary:

Issue 1: Barred by Limitation
The appeal challenged the order passed u/s 154 of the Income-tax Act, 1961 beyond the prescribed time limit. The assessee contended that the application should be deemed accepted due to the delay. The Tribunal did not delve into this issue as relief was granted on merits.

Issue 2: Adjustment of Seized Fixed Deposits
The main issue was whether the assessee was entitled to adjust seized fixed deposits against self-assessment tax liability. The Income Tax Department did not credit the seized assets towards self-assessment tax, leading to a demand on the assessee. The Tribunal held that any tax paid after the financial year's expiry is considered an advance payment of self-assessment tax. Citing a previous tribunal decision, the Tribunal directed the AO to adjust the fixed deposits against self-assessment tax and recalculate interest u/s 234B accordingly.

Conclusion:
The Tribunal allowed the appeal, directing the AO to adjust the seized fixed deposits against self-assessment tax payable by the assessee. The relief was granted on merits, rendering the issue of limitation moot. The appeal was allowed for statistical purposes.

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