2003 (3) TMI 743

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....for the assessee fairly conceded that all these issues are decided against the assessee by the Tribunal in the said order. In view of this, I dismiss Ground Nos. 1 to 7. 3. The only issue pressed before me pertains to the computation of interest charged under section 234A of the Income-tax Act, 1961 (hereinafter called the Act). 4. The learned counsel for the assessees did not challenge the levy of the interest. It was conceded that interest under section 234A(1) of the Act is leviable in the facts and circumstances of the present case. But it was argued that the interest can be charged only for a period of two years. Beyond that it was not possible on the part of the assessee to file the return till the issuance of notice under section 1....

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....mpossibility of performance is a good excuse. 7. In the case of B.M. Rele (supra), the Tribunal held that filing of returns means filing of a valid return. When the assessee is debarred and not allowed to file a valid return after the period of limitation, it could not be said that he committed default and failed to file the return thereafter without reasonable cause. The period uptil revived by the issue of notice under section 148 of the Act, could be excluded from the levy of penalty. The laches on the part of the assessee cannot create a right in favour of the revenue to treat an invalid return as a valid one or to convert an impossible situation into a possible one. 8. Section 234A prescribes as under : "234A.(1) Where the ret....

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....the Amending Act, 1987, has substituted the aforesaid provisions by a simple scheme of payment of mandatory interest for defaults mentioned therein. The aforesaid provisions provides that where a return of income is furnished after the due date or is not furnished, the assessee shall pay simple interest at the rate of one and one-fourth per cent for every month, or part of a month comprised in the period of default on the amount of tax on total income determined on regular assessment, as reduced by any advance tax paid or tax deducted at source. As such, the word "regular assessment" is used in the context of computation. It does not say that the order passed under section 143(3)/144 of the Act shall be substituted by section 147 ....