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2013 (2) TMI 608 - DELHI HIGH COURTPeriod of limitation for rectification u/s 154(7) - stay of the demand raised by the petitioner - Held that:- The entire demand of Rs.92,54,79,604/- in respect of the assessment year 2004-05 is time barred because the notice itself under section 154 was issued after four years from the end of the financial year in which the assessment had been originally framed. In the year 2005-06 the demand had been initially quantified at Rs.225.86 crores which has been reduced by a sum of Rs.30 crores because the petitioners have paid the said sum in March 2012. The balance is, therefore, Rs.195,86,36,433/-. The original demand of Rs.225.86 crores comprised of two components i.e. Rs.114 crores towards the alleged principal tax liability and Rs.110 crores towards the purported interest liability. Rs.110 crores interest liability can be broken up into three components first being an amount of Rs.75 crores raised as per the demand notice under section 156 dated 16.03.2012 for a period prior to the date of notice, thus this demand is ex facie bad inasmuch as section 220(2) contemplates charging of interest for nonpayment of a demand raised under section 156 and that, too, after 30 days thereof. In the present case the demand itself was raised on 16.03.2012 therefore there cannot be any interest charged for a period prior to it. Interest demanded of Rs.15 crores u/s 234B - As decided in Abdul Wahid and Company case [2010 (6) TMI 85 - MADRAS HIGH COURT] when the liability for payment of additional tax itself was created for the first time, based on the subsequent amendment, in the year 2005, with retrospective effect from 01.04.1998, it would be incongruent to expect the assessee to have satisfied the requirement of payment of advance tax as prescribed under Section 234 (B) of the Income Tax Act – interest u/s 234B can not be imposed Sum of Rs.30 crores has been demanded on the basis of disallowance of the annual licence fee amount on the issue of whether the same was capital or revenue in nature. The Tribunal, in the case of the assessee itself decided in favour of the assessee. The petitioner sought to set off this sum of Rs.54 crores against a payment of Rs.87 crores for the assessment year 2008-09 which cannot be accepted inasmuch as focus is on the two assessment years 2004-05 and 2005-06 and this was not the issue when the impugned order dated 03.01.2013 was passed. Consequently, there is an outstanding alleged demand of Rs.54 crores on account of tax and Rs.20 crores on account of interest which is, prima facie, recoverale from the petitioner - a demand of Rs.74 crores would possibly be sustainable at the present stage the petitioner should deposit 75% of this figure of Rs.74 crores which would roughly come to Rs.55.5 crores round off to Rs.56 crores.
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