2015 (10) TMI 1502

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.... section 220(2) of the Act. 2. Brief facts are that assessments for the assessment years 1995-96 and 1997-98 were completed under section 143(3) of the Act disallowing expenditure on replacement of machinery. Assessee preferred appeals before the Commissioner of Income Tax (Appeals) who confirmed the assessments in disallowing such expenditure. Further appeals were filed before the Tribunal. The Tribunal confirmed the order of the Commissioner of Income Tax (Appeals). The assessee filed appeals before the High Court and the High Court held that expenditure incurred on replacement of machinery was revenue in nature. The Revenue preferred SLP wherein the Supreme Court remitted the appeals back to the file of the Commissioner of Income Tax (A....

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....sidered a similar issue for the assessment years 1994-95 &1999-2000 holding as under:- "5. The second ground raised by the assessee in the appeals relates to levy of interest under section 220(2) of the Act. We find that the issue is also adjudicated in assessee's own case in ITA No.1870/Mds./12 decided on 20.02.13, the relevant extract of the order of the Tribunal dealing with this issue is reproduced herein below: "12. The next issue raised by the assessee is with regard to levy of interest under section 220(2) of the Act. The Assessing Officer vide assessment order dated 21.12.2011 has levied interest under section 220(2) for the period of 35 months from 1.2.2009 to 31.12.2011. 13. The counsel for the assessee has submitted that s....

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.... in the assessment order passed under section 143(3) read with section 254 of the Act about the levy of interest under section 220(2). There is no bar for assailing any issue which is part of the assessment order. Therefore, the contention of the DR that interest levied u/s.220(2) is not appellable in the present case is not tenable. 15. Moreover, in Circular No.334 dated 3.4.1982 the Department has clarified that "where an assessment order is cancelled u/s.146 or cancelled/set aside by an appellate/ revisional authority and the cancellation/setting aside becomes final, no interest under section 220(2) can be charged pursuant to the original demand notice. The necessary corollary of this position will be that even when the assessment is re....