TaxTMI 
TaxTMI 
2024 (12) TMI 557
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.... 3. The brief facts are that the assessee IDFC Financial Holding Company Limited is a public company, incorporated in India. The assessee is a wholly owned subsidiary of IDFC Limited. The assessee e-filed its return of income (RoI) on 24th October 2019 declaring total income at Rs. 58,23,49,060/- as per normal provisions and deemed total income of Rs. 142,31,14,669/- as per section 115JB of the Act and claimed refund of Rs. 46,860/-. The assessee paid taxes as per the provisions of section 115JB of the Act since it was higher than taxes payable as per the normal provisions. The RoI was processed by CPC under section 143(1) of the Act (Intimation) and the CPC enhanced the interest u/s. 234C of the Act to the tune of Rs. 1,48,04,175/- whereas assessee computed the interest u/s. 234C of the Act at Rs. 29,51,188/-. Such a demand has been determined on account of levy of interest u/s. 234C of the Act in respect of advance tax payable on transaction pertaining to capital gains on sale of investment. In this regard, the Ld.AR pointed out that the book profit for MAT to the tune of Rs. 1,42,31,14,669/- (includes capital gains on sale of investments of Rs. 1.40 Crs) and which event arose....
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.....2019 by paying 1% advance tax. We note that similar issue had come up before this Tribunal in the case of M/s.Hamilton Industries Pvt. Ltd., in ITA No.218/Mum/2022 for AY 2018-19 dated 10.08.2022, wherein, the facts as noted by the Tribunal are as under: 2. Brief facts of the case are that the assessee filed its return of income on 24-09-2018 u/s 139(1). There after assessee received an intimation u/s 143(1)(a) dated 15-05-2019. Assessee declared total income of Rs 10, 66, 15,871/- under the normal provisions and Rs 13, 95, 37,529/- under the provisions of MAT. Accordingly, the appellant company had paid taxes with interest under MAT provisions of Rs 2,97,79,541/-. 3. The above said book profit includes capital gain of Rs 17,77,44,323/- which arose in 4th quarter only i.e., on 28-02-2018 and 28-03-2018. Accordingly, assessee paid advance tax on 15-03- 2018 and 31-03-2018 for the capital gains arose on 28-02-2018 and 28-03-2018 respectively. Subsequently an intimation u/s 143(1) received as mentioned (supra.) wherein all the calculations of tax payable, interest, figures of income returned and other figures embodied in the return were accepted by the CPC Bangalore....
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....current income on or before the 15th day of March is less than the tax due on the returned income, then, the assessee shall be liable to pay simple interest at the rate of one per cent on the amount of the shortfall from the tax due on the returned income:]] [Provided that nothing contained in this sub-section shall apply to any shortfall in the payment of the tax due on the returned income where such shortfall is on account of underestimate or failure to estimate- (a) the amount of capital gains; or (b) income of the nature referred to in sub-clause (ix) of clause (24) of section 2; [or] [(c) income under the head "Profits and gains of business or profession" in cases where the income accrues or arises under the said head for the [first time; or]] [(d) the amount of dividend income,] and the assessee has paid the whole of the amount of tax payable in respect of income referred to in clause (a) or clause (b) [or clause (c) [or clause (d)]], as the case may be, had such income been a part of the total income, as part of the [remaining instalments of advance tax which are due or where no such instalments are due], by the 31st day of March ....
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....rposes of this sub-section, the term "dividend" shall have the meaning assigned to it in clause (22) of section 2, but shall not include sub-clause (e) thereof.] (2) The provisions of this section shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1989 and subsequent assessment years.]]" 7. Second proviso to section 234C clearly deals with the situation of assessee. As there is no challenge to the fact that assessee was prompt and regular in calculation and payment of advance tax u/s 234A, 234B and 234C. This fact is also not under challenge that to unanticipated transactions under the head capital gains arose in the case of assessee 28- 03-2019. Assessee promptly discharged his liability of advance tax u/s 234C on 31-03-2019. We have considered the order of Ld. CIT (A) wherein he relied on circular no 13/201-Income Tax, dated 09-11-2001, issued by the CBDT and the decision of hon'ble Supreme Court in the case of CIT Vs Rolta India Ltd. Vide CIVIL APPEAL NO. 135OF 2011 has upheld the levy of interest u/s 234B and 234C. in a case of assessee being a company on the basis of book profit u/s 115JB. An identical issue had ....
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....il said liability was discharged in April 2000 - Assessing Officer held that assessee was liable to pay interest for entire period to extent there was short fall in payment of advance tax calculated as per income returned by assessee including capital gains from 15-9- 1999, when first instalment of advance tax became due - Tribunal, however, held that Assessing Officer was not justified in charging interest for period prior to date when liability to tax arose - Whether order of Tribunal was justified - Held, yes [2010] 127 ITD 257 (MUM.) Torrential Investments (P.) Ltd. * v. Income-tax Officer, Ward2(3)(3), Mumbai Section 234C of the Income-tax Act, 1961 - Interest, chargeable as - Assessment year 199697 - Capital gains accrued to assessee on account of sale of an asset in months of May 1995 and July 1995 - It filed its return for assessment year 1996-97 showing long-term capital gains - Assessee had paid advance tax in instalments after date of sale of assets in view of amendment to proviso to section 234C by Finance (No. 2) Act, 1996 with effect from 1-4-1997 - Revenue authorities held that capital gains in instant case had accrued in months of May, 1995 and Jul....
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....stimate accrual or receipt of such income at any time when the payment of first, second, third or fourth instalment of advance tax, as the case may be, is due, the assessee is not liable to pay advance tax on the respective due dates in respect of such windfall gain. 12. If on a particular due date for payment of advance tax, the facts show that there is no liability to pay advance tax, non-payment of advance tax on the due date may not be considered sufficient to attract interest u/s 234C. If the returned income is higher due to unexpected income received subsequent to earlier due dates, the shortfall in payment of advance tax installment in earlier date may not attract interest. As far as income under the head business/profession is concerned, interest under section 234C of the Act shall not be chargeable on default in payment of advance tax in respect of such income only in the first year of business/profession. For income in the nature of windfall gain/unexpected income under other heads of income, provisions of S. 234C (1) shall not apply to any shortfall in the payment of the advance tax due on such income if the same is of the nature which can't be foreseen by t....