TaxTMI 
TaxTMI 
2026 (6) TMI 1453
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.... Year 1996-1997 to 2000-2001. 3. The Appeals are admitted for consideration of following substantial question of law: "Whether the Appellate Tribunal is right in law and on facts in confirming the order passed by the CIT(A) deleting the penalty levied under section 13 of the Interest Tax Act, 1974?" 4. Brief facts of the case are that a notice under section 10 of the Interest Tax Act, 1974 was issued on 22.03.2002 requiring the respondent-assessee to furnish its return of income for the Assessment Years 1996-97 to 2000-01. 4.1 The respondent-Assessee, by letter dated 20.04.2022, submitted that it was not liable to tax under the Interest Tax Act, 1974. 4.2 Thereafter, a notice under section 8(1) of the Interest Tax Act, 1974, was issued by the Assessing Officer. In response, the assessee filed the returns of Interest Tax on 26.02.2003. The Assessing Officer passed the Assessment Order on 26.03.2003 under section 8(2) read with section 10 of the Interest Tax Act, 1974, for all the five years assessing the chargeable interest as returned, without any addition or deduction. 4.3 Thereafter, the Assessing Officer levied penalty under section 13 of the Interest Tax....
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....l to be considered. The details of the interest income etc. were available in the income tax assessment record. These details are in terms of section 22 of the Interest Tax Act necessarily to be considered for the purpose of interest tax. Thus, the details were already available in the record of the Assessing Officer, and the assessee had explained that it was not liable to Interest Tax Act. Thus, there was no mala fide intention of the assessee in giving such explanation. The assessee had filed Interest Tax return showing the entire interest income except the interest income from financing institutions and this return is accepted in the assessment U/s. 8(2) r.w.s. 10 of the Act. Considering these facts, I hold that there was no question of alleged concealment against the assessee and the penalty levied by the Assessing Officer requires to be deleted. The decision of the Supreme Court in the case of Sadilal Suger Mills Ltd reported at 168 ITR supports the appellant's case that the income was duly offered under the Interest Tax Act. Apart from this, the ratio of the decision of the Supreme Court in the case of Hindustan Steels Ltd. reported at 83 ITR 26 also is applicab....
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....eturn voluntarily under section 7 of the Act would entail the provision for imposing penalty u/s. 13 of the Interest Tax Act, did not flow from the provision of Interest Tax Act, penalty could not be imposed." 15.1.(i) The facts of the case before the Hon'ble High Court were that the assessee, which was a financial company was required to file the return of Interest Tax Act upto 31/12/1999. Since the company had not furnished the return, a notice u/s. 10 of the Act was issued on 15/04/1996 requiring the assessee to furnish the return of chargeable interest within 30 days. Since the assessee failed to furnish the return within the prescribed time, a second notice was issued on 26/11/1996. The assessee-company filed the return on 31st October-1996 and had shown an amount of Rs. 46,13,91,700/- as total chargeable interest, whereas the assessment was made u/s. 8(2) of the Act on February 04-1997 determining the chargeable interest at Rs. 50,44,91,718/-. 15.1(ii) On appeal by the Assessee, the CIT(Appeals) reduced the assessed interest equal to the returned chargeable interest shown by the assessee. 15.1 (iii) Thereafter, the Assessing Officer, issued noti....
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....r the respondents that the return furnished by the assessee did show the amount of Rs.46 crores odd and in assessment it was enhanced but finally the assessment was made of the same amount which has been furnished by the assessee on effect being given to the order passed in appeal. That being so, this cannot be a ground for entertaining the appeal. 8. The appeal has no force and is hereby dismissed." 16. Coming to the present case, it is an admitted fact that though the assessee furnished the returns for all the five assessment years after issuance of notices u/s. 10 of the Act and had returned taxable chargeable interest, but the assessments for all the assessments have been framed on the returned chargeable interest itself and, therefore, there is no question of considering the same as concealment or furnishing of wrong particulars on the basis of main provisions of section 13 of the Act. 17. So far as question of concealment on the basis of deeming provisions, as are enumerated in Explanation-3 to Section u/s. 271(1)(c) of the Income Tax Act are concerned, we are of the opinion that the issue before us is squarely covered in favour of the Assessee and ....
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....in the course of any proceeding under this Act, is satisfied that any person has concealed the particulars of chargeable interest or has furnished inaccurate particulars of such interest, he may direct that such person shall pay by way of penalty, in addition to any interest-tax payable by him, a sum which shall not be less than, but shall not exceed three times, the amount of interest-tax sought to be evaded by reason of the concealment of particulars of his chargeable interest or the furnishing of inaccurate particulars of such chargeable interest.]" 10. This Court, in case of Abhishek Finlease Ltd. (supra), after considering the similar facts, has held as under: "4. In so far as the reasoning that the Assessing Officer, while assessing returns of the assessee under the Income Tax Act, also did not bring to the notice of the assessee, requirement of filing return under the Interest Tax Act and, that therefore, the penalty should not be levied, may not be entirely palatable. We are, however, of the view that in the present case, even otherwise, order of deletion of penalty can be supported and justified. Section 13 of the Interest Tax Act (repealed since the year 2001)....
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....determine the question as to whether the penalty is leviable in terms of Section 13 of the Interest Tax Act or not. The Tribunal could not have set-aside the entire order on this ground alone. Section 13 of the Act provides that penalty which shall not be less than the amount of tax sought to be evaded but shall not exceed three times the amount of tax sought to be evaded, can be levied in case the assessee has concealed particulars of chargeable interest or has furnished inaccurate particulars of such interest. The provision of Section 271(1)(c) which lays down a presumption against the assessee in case of non filing of return within a particular time is not applicable to the Interest Tax proceedings. However, de hors of Section 271(1) (c), Section 13 does provide the grounds and procedure for levy of penalty. In case the Assessing Officer is convinced that the assessee has concealed particulars of chargeable interest or has furnished inaccurate particulars penalty can be levied. We accordingly decide the question in favour of the revenue and remand the case to the Assessing Officer who shall determine the question as to whether the assessee is liable to pay pena....