2005 (10) TMI 47

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....70?" The assessment year is 1986-87 and the relevant accounting period is the year ended on March 31, 1986. While framing the assessment on February 7, 1989, under section 143(3) of the Income-tax Act, 1961 ("the Act"), the Assessing Officer observed "charge interest under sections 139(8) and 215/217". The assessee carried the matter in appeal before the Commissioner of Income-tax (Appeals) who vide his order held that the ground of appeal challenging the levy of interest under section 139(8) of the Act was not entertained as the legality of the basis of levy had not been challenged as being incorrect. However, the Commissioner of Income-tax (Appeals) upheld the submissions of the assessee that the assessee was not liable to be charge....

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....no appearance on behalf of the respondent-assessee. According to Mr. Bhatt, the Tribunal had committed an error in holding that no interest was leviable under section 215(1) of the Act. The said provision was automatic and did not grant any discretion to the assessing authority. Not only that, it was contended, once the difference between the two parameters, namely, advance tax paid and the assessed tax exceeded the prescribed limit, the assessee could not be permitted to deny his liability to interest under section 215 of the Act. In case any extenuating factors or circumstances justified, according to the assessee, a lower amount of advance tax, that would be a ground for seeking relief under sub-section (4) of section 215 of the Act, ....

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....under section 140A of the Act for such year. Thereafter, the assessee is required to ascertain which of the two figures exceeds the other, viz., whether the latest assessed income is higher than the latest returned income or the other way round and taking that as a base, the assessee is required to work out the current income and the liability to pay advance tax. If the aforesaid scheme is borne in mind, it is apparent that unless and until the Revenue is in a position to state that either of the figures adopted for the purposes of computing the current income and the advance tax payable is incorrect in any manner whatsoever, it will not be possible to accept the contention of the Revenue that levy of interest under section 215 of the Ac....