1996 (12) TMI 124

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....unt of Rs. 2,03,984 after giving the deduction of Rs. 13,283 paid as TDS. The assessee has not paid any advance-tax. Aggrieved by the above intimation, the assessee approached the AO contesting that the interest under s. 234A has not been properly worked out on the ground that the credit for self-assessment tax payment of Rs. 1,50,000 paid on 27th July, 1993 was not considered while computing the interest under s. 234A of the IT Act, 1961. The AO rejected the assessee's claim holding that section only speaks of advance-tax paid and the tax deducted or collected at source and not of self-assessment tax paid by the assessee. Aggrieved by the above order, the assessee approached the learned CIT(A). 3. Before the learned CIT(A), relying upon....

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....n of the Hon'ble Supreme Court in the case of Ganesh Dass Shreeram vs. ITO (1987) 66 CTR (SC) 135 : (1988) 169 ITR 221 (SC). Thus, the learned counsel contended that since the assessee had paid Rs. 1,50,000 under s. 140A on 27th July, 1993, by way of self-assessment tax, it should have been taken into consideration before levying interest under s. 234A of the Act. The learned Counsel, relying upon the decision of the Punjab & Haryana High Court in the case of CIT vs. Atlas Cycle Industries (1989) 180 ITR 319 (P&H), contended that in whatever manner the tax is paid, it shall be taken note of in calculating the interest. Applying this analogy, the learned counsel submitted that whatever interpretation given by the Hon'ble High Court of s. 215....

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....y of interest under s. 234A of the Act. 6. We have heard the rival submissions and gone through the orders of the Revenue authorities and also the decisions relied upon by the learned counsel for the assessee. The Hon'ble Supreme Court in the case of Central Provinces Manganese Ore Ltd. vs. CIT, held that interest is levied under s. 139(8) or s. 215 of the IT Act, 1961, because by reason of the omission or default mentioned in the respective provision, the Revenue is deprived of the benefit of the tax for the period during which it has remained unpaid, In other words, the apex Court held that it is compensatory in nature. The same view has been taken by their Lordships again in the case of Ganesh Dass Shreeram vs. ITO. Indirectly, this w....