1989 (3) TMI 27

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...., 1961, the two sums o Rs. 8,433 each paid on December 30, 1970, and March 29, 1971, respectively, should be construed as 'sums paid in advance under Chapter XVII-C' within the meaning of the Explanation to clause (i) of the said section ?" The reference relates to the assessment year 1971-72. The dispute is about the payment of advance tax and liability to pay penalty for failure of payment of advance tax. The Tribunal has found that the assessee had made payments of advance tax on December 30, 1970, and March 29, 1971. The contention of the Department before the Tribunal was that the accounting year of the assessee ended on the day of Diwali and, therefore, advance tax for the assessment year 1971-72 was payable by the assessee o....

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....at the advance tax shall be payable on the dates mentioned in the section. The argument adopted by the Department, if accepted, may even mean that payments made before those dates (and not on these dates) will not be payments of advance tax. The argument is plainly illogical. All the payments were made by the assessee within the financial year 1970-71 and long before the filing of the return. All these payments were, therefore, payments of advance tax and the assessee was clearly entitled to credit of these payments while determining the amount of assessed tax for calculating the amount of penalty leviable under section 271(1)(a) of the Act. In the demand notice issued to the assessee, the entire amount paid was treated as advance tax paid ....