1980 (12) TMI 92

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....were taken up together for hearing. 2. Assessee runs a School. It has employed on the staff of the school as many as 19 teachers. Assessee used to deduct out of the salaries payable to the said staff of 19 teachers certain amounts by way of tax at source. During the financial years under consideration also, such deductions were made at source and the amounts so deducted were deposited into the ....

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....t amounts for the three years under consideration. 5. Assessee has come up in second appeal. A number of contentions were raised before us. Firstly, it was urged that the ITO, T.D.S. Salary Cir II,New Delhi, who made the impugned order levying interest had no jurisdiction, inasmuch as the assessee being a trust was being assessed to income tax by the ITO,Trust Circle. On our query, assessee's c....

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....ectively, the impugned order of levy of interest as made on 10th Jan, 1979 was time barred. We are unable to agree. The order as a whole as such cannot be struck down as being time barred. According to us, in face of the provisions of s. 231, the Department's power to levy interest for the periods subsequent to31st March, 1976,31st March, 1977and31st March, 1978, in respect of three years under co....

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....perhaps the Department could legitimately urge that levy of interest involved only an arithmetical exercise. But in a case where delayed deposit of amount deducted is not involved, it was necessary for the ITO to hear the assessee before interest could be levied. In this view of the matter, question arises whether we should remit the matter to the ITO so that he can cure the infirmity that crept i....