2016 (8) TMI 61

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....der section 154 of the Income Tax Act, 1961 (in short 'the Act'). 2. In both the appeals, a common issue has been raised which relates to charging of interest u/s 234B of the Act. Since the facts and circumstances in both the appeals stand on an identical footing, we may refer to the appeal for Assessment Year 2003-04 for appreciation of the relevant facts. The appellant before us is a company incorporated under the provisions of the Companies Act, 1956 and is, inter-alia, engaged in the business of manufacturing and selling of petrochemical products. The assessee-company submitted its return of income on 29.11.2003 declaring income of Rs. Nil under normal provisions and Rs. 240,50,25,600/- u/s 115JB of the Act. Assessment u/s 143(3) of ....

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....f the rectifications sought, but so far as the plea for deletion of interest charged u/s 234B of the Act was concerned, the Assessing Officer rejected the same vide order dated 2.4.2013. Against such an action of the Assessing Officer, assessee carried the matter in appeal before the CIT(A). As per the CIT(A) there is no provision in the Act which specifies that interest u/s 234B of the Act could not be charged on the additions made consequent to any retrospective amendment to any of the provisions of the Act. Thus, he upheld levy of interest u/s 234B of the Act. 3. Before us, there is no dispute to the fact that the interest u/s 234B of the Act has been charged in the present case as a consequence of an addition made to the total income....

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....hat interest u/s 234B of the Act could not be charged in a situation where the addition made by the income-tax authorities is based on a subsequent amendment in law. According to the assessee, during the previous year related to the assessment year under consideration, it could not have visualized the subsequent amendment made by Finance Act No. 2 of 2009 to Sec. 115JB of the Act with retrospective effect from 1.4.2001 whereby the Provision for bad and doubtful debts was liable to be assessed for determining the income u/s 115JB of the Act. The aforesaid argument of the assessee cannot be faulted and in fact, the aforesaid decisions relied upon by the assessee clearly support the assertion that interest u/s 234B of the Act is not chargeable....