TaxTMI 
TaxTMI 
TaxTMI 
1988 (8) TMI 118
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....e deduction as claimed as claimed by it should be allowed. In the assessment framed u/s. 143(3) r. w. s. 144B of the Act, the ITO had accepted the assessee's contention, in view of the stay granted by the Supreme Court in the following manner : "12. The assessee-company has claimed 80J relief on the gross amount of the assets without deducting any liability. The law has been amended with retrospective effect by Finance (No. 2) Act, 1980 according to which liabilities to be deducted from the capital employed so as to compute the correct amount for 80J. However, the assessee-company has obtained stay from the Supreme Court against invoking provisions of amended act. Respectfully following the Supreme Court's stay, 80J allowance has been allowed on the gross value which will be rectified after the receipt of Supreme Court's order if necessary. 14. 80J allowance comes out to be as follows : Unit No.2 5th year Rs. 3,94,717 Unit No.3 3rd year Rs. 1,82,981 Unit....
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....ited to sec. 2(40) of the Act which contains the definition of "regular assessment". It was, therefore, urged that the ITO was not justified in withdrawing a part of the interest allowed u/s. 214 of the Act at the time of original assessment. The CIT (A) however did not find any substance in the plea taken by the assessee in the following manner : "There is hardly any substance in the contention of Shri V. R. Shah. The ITO has only amended the regular assessment originally framed. It does not cease to be a regular assessment after passing the order under sec. 154 by the ITO in order to give effect to the judgment of the Hon'ble Supreme Court. Therefore, it is within the powers of the ITO to withdraw the interest allowed to the assessee under sec. 214. Under the circumstances, no interference in called for." 6. Being aggrieved by the order of the CIT (A), the assessee has come up in appeal before the Tribunal. In order to better appreciate the rival contentions, the position that emerges after orders passed under sections 143(3) and 154 of the Act are tabulated below : ------------------------------------------------------------------------- &nbs....
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....sp; Rs. Rs. Advance tax paid 30,00,000 30,00,000 Tax payable 27,40,804 28,90,516 --------- --------- Refund of tax 2,59,196 1,09,484 In....
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.... Rs. 1,49,712 and for excess refund of interest under section 214 of Rs. 61,377. Total Rs. 2,11,089. 7. The learned counsel for the assessee reiterated the submissions which were made before the IT authorities and strongly contested that the ITO was not justified in withdrawing a part of the interest which was granted to the assessee under section 214 of the Act. Inviting our attention to section 154 of the Act, he submitted that on the facts and circumstances obtaining in th instant case, the ITO could not have passed order under that section with a view to withdraw a part to the interest granted to the assessee under section 214. of the Act, as there was no mistake apparent from he record justifying such action. According to the learned counsel for the assessee, since the modification in the assessment order was not required to be made on account of any appellate order or a decision of the High Court/Supreme Court in a reference matter, no order could be passed under section 154 of the Act. In this connection, he stated that along with other assessee, the assessee had challenged the constitutional validity of certain provisions of section 80J of the Act and the Rules made there....
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.... part of the interest granted to the assessee under section 214. of the Act. He also invited our attention to the remarks made by the ITO in the assessment framed on 5-9-1983 (reproduced above) and pointed out that he had framed the said assessment subject to the decision of the Hon'ble Supreme Court which was awaited at that time. In other words, he submitted that the order passed by the ITO under section 154 of the Act, after the pronouncement of the decision of the Hon'ble Supreme Court was nothing, but the continuation of completion of the assessment process. He also highlighted the fact that but for the stay obtained by the assessee from the Hon'ble Supreme Court, the ITO would have framed the assessment on Rs. 48,88,822 originally ignoring the assessee's claim that the liabilities should not be considered in working out the 'capital employed' for the purpose of granting deduction under section 80J of the Act. In this view of the matter, the assessee would not have been entitled to interest under section 214 of the Act to the extent of Rs. 61,337. However, since the assessee had obtained a stay from the Hon'ble Supreme court, the ITO had no choice but to asst. order with such ....