TMI Blog2010 (1) TMI 705X X X X Extracts X X X X X X X X Extracts X X X X ..... 961 - Assessing Officer was not justified in withdrawing the interest under section 244A(1) because the seized cash was adjusted against the existing liability and interest under section 244A was liable from the date on which the amount was adjusted against the existing liability to the date when the amount was refunded - Decided in favor of assessee. - ITA No. 568/Bang/2009, ITA No. 631/Bang/2009 - - - Dated:- 29-1-2010 - N.L. Kalra, George George K, JJ. Jacinta Zimik Vashai for the Appellant Dinesh for the Respondent ORDER Bench: The revenue as well as the assessee have filed appeals against the order of learned Commissioner of Income Tax (Appeals)-VI, Bangalore Dt.23.3.2009. 2. The Assessing Officer c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng but rectifying a mistake apparent on record and thus mistake is not a debatable issue. The learned Assessing Officer referred to section 244A in which it has been mentioned that interest is payable on advance tax or TDS etc. Nothing is mentioned in section 244A that interest under section 244A can be given on self assessment tax. 3. The assessee filed an appeal before the learned CIT(A). It was submitted that the issue on which the Assessing Officer has done rectification is a debatable issue and therefore the Assessing Officer should not have passed order under section 154 on the debatable issue. The learned A.R. relied on the following decisions before the learned CIT(A) in which it has been held that rectification under section 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice of demand issued under section 156 is paid in excess of such demand. Thus, a controversy has arisen that whether the self assessment adjusted is in pursuance of a notice of demand or not ? The Karnataka High Court in CIT vs. NGEF Ltd. (244 ITR 665) (Kar) held that when an assessment is completed, the self assessment tax already paid under section 140A gets adjusted against the assessment tax and thus partakes of the character of assessed tax. Therefore, the self assessment tax paid by the assessee should also be taken into account for the purpose of allowing interest under section 244A(1) of Income Tax Act. This decision is binding. Respectfully following the same, I direct the A.O. to adjust the self assessment tax against the dema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the extent of Rs.1,58,05,350, unexplained creditors for building to the extent of Rs.3.5 crores and unexplained expenditure of Rs.1.25 crores. Such additional income was disclosed as per the statement recorded under section 132(4). The assessee filed a revised return on 27.2.2007 vide which an income of Rs.2,25,33,625 was declared. The reason for filing revised return was for the purpose of claiming depreciation which was not claimed in the original return. The assessee filed another revised return on 28.3.2007 vide which an income of Rs.4,20,43,975 was disclosed and the assessee also claimed exemption under section 11 of the Income Tax Act, 1961. The Assessing Officer in the computation of income vide order dt.24.12.2007 considered the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se may be) (including any penalty levied or interest payable in connection with such assessment) and in respect of which such person is in default or is deemed to be in default, may be recovered out of such assets." As per the above provision, the seized cash could have been utilized for satisfying the existing liability or should have been utilized against the liability determined on the completion of assessment under section 153A. Sub-section 4 of section 132B mentions that the cash which has not been adjusted as per section 132B(1)(i), then the balance is to be released to the assessee and the assessee has to get interest under section 132B(4) and interest is for the period from the date immediately following the expiry of the period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... timation on the basis of the income returned. No such details have been furnished to show that the Assessing Officer processed the earlier return vide which the assessee was payable to pay tax to the extent of Rs.1,02,63,449. The Assessing Officer has basically passed order under section 154 on the ground that seized cash has been paid as self assessment tax. The facts on record does not show that the assessee has paid self assessment tax under section 140A(1). The amount was realized from the seized cash for adjustment of existing liability. In case the return was processed then the intimation was to be treated as a demand notice under section 156 and on that basis the seized cash should have been adjusted against the liability. 7. Mor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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