2014 (9) TMI 132

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... ORDER The Court : This appeal is directed against the judgement and order dated 7th October, 1999 by which the learned Tribunal agreed with the appellate authority that the judgement of this Court in the case of All India Insurance Employees Association and others vs. Union of India (1989) 176 ITR 225 was in operation when there was an omission on the part of the assessee to deduct tax upon ci....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....re to pay the dues on the due date. He in support of his submission relied on a judgement of the Supreme Court in the case of C.I.T. vs. Prem Nath Motors (Pvt.)Ltd. reported in 2002(253) I.T.R. 705 wherein the apex Court opined as follows;- "Interest" is a consideration paid either for use of money or for forbearance in demanding it, after it has fallen due. It is a compensation allowed by law ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....y, it is clear that it is compensatory in character and not in the nature of penalty. It is seen that there are several provisions where the Legislature has made a distinction between interest payable and penalty imposable. The ultimate liability for tax being not there does not dilute the requirements for the noncompliance with which interest is levied under section 201(1A) Mr. Agarwal, submit....