TMI Blog2010 (3) TMI 1101X X X X Extracts X X X X X X X X Extracts X X X X ..... ing that the interest u/s 234A, 234B and 234C of the Income Tax Act should be calculated in seriatum instead of allowing the calculation to the benefit of the assessee in the absence of any method prescribed under the Income Tax Act. 2. We have heard the rival submissions and carefully perused the orders of the authorities below and documents placed on record. During the course of hearing, the Ld. Counsel for the assessee has invited our attention to the order of the Tribunal in the case of Mrs. Sheela Jaisingh Vs. ACIT 13 SOT 617 and the judgement of Delhi High Court in the case of Dr. Pranoy Roy and others and another Vs. CIT 254 ITR 755. In support of the contention that while calculating the interest u/s 234A a credit of advance ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the nature of advance tax, paid . Second situation deals with a case where there is short payment of advance tax, i.e., where the advance tax paid by the assessee under the provisions of s. 210 is less than 90 percent of the assessed tax. In such a case, the assessee is required to pay interest on the difference between the assessed tax and the amount of advance tax paid by the assessee. Here too, the Department wants to levy interest even after the deficiency in payment of advance tax has been made good on the ground that the deficiency so made good cannot be treated to be the amount of advance tax paid unless it is paid on the due date itself. The factual matrix of the case is clear that the aforesaid sum of ₹ 2,44,704 paid on 25 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s fallen due. It is a compensation allowed by law or fixed by parties or permitted by custom or usage for use of money, belonging to another, or for the delay in paying the money after it has become payable. Interest is awarded in favour of a person who is deprived of the use of money while it is paid by a person who uses or retains that money. If a person does not use or retain the money of others, he cannot be saddled with the liability to pay interest to them. Likewise, interest cannot be allowed in favour of a person who has not been deprived of the use of his money. It is for this reason that sub-s. (1) of s.234A requires the interest to be charged on the amount of the tax on the total income as determined under sub-s. (1) of s.143 or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed for retention of money to prevent unjust enrichment. It follows as a natural corollary that interest cannot be charged when there is no retention of money as there can be no unjust enrichment in such a case. It will lead to unjust result if the Department is permitted to levy interest under s. 234A on that amount also, which the assessee has already paid. It is therefore in this context that the term advance tax used in s. 234A(1) requires to be interpreted in its generic sense. So interpreted, the term advance tax used in s.234A would cover all the taxes paid in advance of the tax liability anticipated by the assessee for the concerned assessment year. AO is directed to give credit for a sum of ₹ 2,44,704 paid on 25th April, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
