2017 (12) TMI 1524

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.... the judgment in case of Dr. Prannoy Roy given by Delhi H.C. - (2002) 121 Taxman 314 (Delhi) & upheld by Apex Court vide (2009) 179 taxman 53(SC) in view of Rule of beneficial construction & rule of purposive construction etc. The main crux of the above judgment is to interpret & treat the interest u/s 234A as compensatory in nature & not to penalize or punishing for delayed submission of return as no one can read a penal provision in section 234A of the IT. Act. Further, in Roshanlal Kapoor v. Assistant Commissioner of Incometax [2008] 26 SOT 26 (Chennai) (URO)(SMC) ITAT CHENNAI BENCH ('B') (SMC), the Hon'ble bench has given the relief, placing reliance on above judgment, even in case, the tax u/s 140A has bee....

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.... deposited on 30/12/13, along with interest under section 234A at Rs. 1,90,580/- computing delay of one month. Ld.A.R. submitted that though the returned income was accepted by Ld. AO vide order dated 19.04.2015. Ld. AO enhanced interest under section 234A at Rs. 22,86,984/- and computed interest u/s 234B at Rs. 20,50,662/-. 2.1. Ld.AR attempted to propose before this Tribunal that interest levied under section 234A is not to penalise for delay in filing of return but is compensatory in nature to compensate the revenue for having not paid the self assessment tax. 2.2. In respect of the interest levied under section 234B, Ld.AR submitted that assessing officer treated the interest computed under section 234A as assessed tax for the pur....

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.... is not liable to pay interest as, it has paid the assessment tax though belatedly (by 1 month) before the filing of return, which included interest u/s 234A at 1% of taxable income (which has been computed by taking into consideration 1 month delay only). On the other hand Ld.D.R. contends that interest under section 234 A is chargeable for default in filing of original return on due date which does not stop with the payment of self assessment tax. 3.4. Relevant provisions applicable to the facts before us are as under: (i) Section 234 A : Interest payable for default in furnishing the return of income. Where the return of income for any assessment year is furnished after the due date or is not furnished, assessee shal....

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....llowing decision of Hon'ble Supreme Court, wherein it has been intimated that no interest under section 234A was chargeable on the amount of self-assessment tax paid before the due date of filing of return of income. 3.7. In the present facts of the case, admittedly self-assessment tax has been paid with a delay of one month, after the due date of filing of return. In our considered opinion non-fulfillment of precondition culls out assessee's case from the protection granted by the Hon'ble Supreme Court in the case of CIT vs. Pranoy Roy (supra) and CBDT Circular No. 2/2015. In our considered opinion the ratio of Hon'ble Supreme Court does not come to the rescue of assessee at all. 3.8. We therefore confirm the interest computed by Ld.....