1984 (3) TMI 127

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....n the total income as assessed under section 154 of the Act was Rs. 12,24,261. On 28-6-1977, the assessee paid Rs. 7,61,910 under section 140A of the Act leaving a balance of Rs. 4,62,351. The ITO charged interest under section 215 of the Act on the assessed tax from 1-4-1977 to 31-5-1977 and on the balance of the unpaid tax from 1-6-1977 to 30-6-1980. The Commissioner was of the opinion that the interpretation of the ITO of the provisions of rule 119A of the Income-tax Rules, 1962 ('the Rules') was incorrect and the ITO should have charged interest on the assessed tax from 1-4-1977 to 27-6-1977 and on the balance of unpaid tax from 28-6-1977 to 30-6-1980. According to him, there was a mistake committed by the ITO in charging interest under....

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....action of a month shall be ignored ; and the period so rounded off shall be deemed to be the period in respect of which the interest is to be calculated ; (b) the amount of tax, penalty or other sum in respect of which such interest is to be calculated shall be rounded off to the nearest multiple of one hundred rupees and for this purpose any fraction of one hundred rupees shall be ignored ; and the amount so rounded off shall be deemed to be the amount in respect of which the interest is to be calculated." Clause (a) of the said rule relates to calculation of interest and is material for deciding this appeal. From the above it is clear that clause (a) requires that the period for which interest is to be charged has to be rounded off to a....