TMI Blog2000 (9) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not be charged on excess tax as per income determined under sections 143(3) and 144 of the Act and further held that interest under section 234A was leviable on the tax on the total income as declared in the return. The said decision is Ranchi Club Ltd. v. CIT [ 1996] 217 ITR 72 (Patna). The correctness of that decision was doubted before the Division Bench by the Revenue. Accordingly, the Division Bench in terms of the judgment dated July 2, 1996 (see [1996] 222 ITR 44), passed in C. W. J. C. Nos. 3287, 2732 and 2780 of 1995 (R), referred the following question for consideration before this Full Bench "Whether interest under sections 234A and 234B read with Explanation 4 is liable to be charged on the returned income or assessed income." Before another Division Bench hearing C. W. J. C. Nos. 2296, 1495, 1507 and 2144 of 1996(R), the question which came for consideration was with respect to chargeability of interest under section 139(8) and section 217 of the Act. Learned counsel appearing for the assessee put reliance on the earlier decision is Uday Mistanna Bhandar and Complex v. CIT [1996] 222 ITR 44 (Patna), in support of his contention that without any specific orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... question referred to this Bench was decided by the Division Bench of this court in the case of Ranchi Club Ltd. [1996] 217 ITR 72 and the said judgment has been affirmed by the Supreme Court in Civil Appeal No. 10360 of 1996 (see [2001] 247 ITR 209). Mr. Moitra, learned counsel appearing on behalf of the assessee, submitted that in view of the dismissal of the appeal by the Supreme Court the view taken by the Division Bench of this court has been affirmed and there is no need for going any further in the matter since the issue has already been settled by the Supreme Court. Mr. Jhunjhunwala, learned counsel appearing for the Revenue, however, submitted that although the two questions referred before this Bench were decided by the Division Bench in Ranchi Club Ltd.'s case [1996] 217 ITR 72 and the civil appeal preferred against the said judgment before the Supreme Court was dismissed, but dismissal of the appeal in limine by the Supreme Court will not amount to affirming the law laid down by the Division Bench in Ranchi Club Ltd.'s case [1996] 217 ITR 72. Learned counsel submitted that summary rejection of the appeal without any specific order merely means that the Supreme Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Constitution is simply dismissed by saying 'dismissed', and an appeal provided under article 133 is dismissed also with the words 'the appeal is dismissed'. In the former case it has been laid down by this court that when a special leave petition is dismissed this court does not comment on the correctness or otherwise of the order from which leave to appeal is sought. But what the court means is that it does not consider it to be a fit case for exercise of its jurisdiction under article 136 of the Constitution. That certainly, could not be so when an appeal is dismissed though by a non-speaking order. Here the doctrine of merger applies. In that case, the Supreme Court upholds the decision of the High Court or of the Tribunal from which the appeal is provided under clause (3) of article 133. This doctrine of merger does not apply in the case of dismissal of a special leave petition under article 136. When an appeal is dismissed the order of the High Court is merged with that of the Supreme Court." Having regard to the law laid down by the Supreme Court quoted hereinabove, I am of the opinion that the questions referred to this Bench have been completely answered by the Divis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry of two years from the end of the assessment year in which the income was first assessable. (2) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142, the Assessing Officer shall, if he considers it necessary or expedient to ensure that the assessee has not understated the income or has not computed excessive loss or has not under-paid the tax in any manner, serve on the assessee a notice requiring him, on a date to be specified therein, either to attend his office or to produce, or cause to be produced there, any evidence on which the assessee may rely in support of the return : Provided that no notice under this sub-section shall be served on the assessee after the expiry of twelve months from the end of the month in which the return is furnished. (3) On the day specified in the notice issued under sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing officer shall, by an order in writing, make a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after the due date or where no return has been furnished, ending on the date of completion of the assessment under section 144, the assessee shall be liable to pay simple interest on the amount of tax on the total income as determined under sub-section (1) of section 143 or on regular assessment as reduced by the advance tax, if any, paid or deducted or collected at source. Similarly, section 234B lays down the provision for payment of interest for default in payment of advance tax. From the reading of these provisions along with the Explanation it is clear that tax on the total income as determined under sub-section (1) of section 143 or on regular assessment shall be deemed to be tax on the total income as declared in the return for the purpose of computing the interest payable under section 140A of the Act. It is also clear that the additional liability to pay interest arises only on account of delayed filing of return or non-filing of return and also on account of delayed payment or non-payment of advance tax. At this stage, it is worth referring to the Departmental Circular No. 549, dated October 31, 1989, in which several examples have been given for the guidance of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the two sub-sections. Therefore, the expression 'tax payable' under the said two sub-sections is the full amount of tax due and 'tax due' is that amount which becomes due exhypothesi on the turnover and taxable turnover 'shown in or based on the return'. The word 'payable' is a descriptive word, which ordinarily means 'that which must be paid or is due, or may be paid' but its correct meaning can only be determined if the context in which it is used is kept in view, The word has been frequently understood to mean that which may, can or should be paid and is held equivalent to 'due'. Therefore, the conjoint reading of sections 7(1), (2) and (2A) and 11B of the Act leaves no room for doubt that the expression 'tax payable' in section 11B can only mean the full amount of tax which becomes due under sub-sections (2) and (2A) of the Act when assessed on the basis of the information regarding turnover and taxable turnover furnished or shown in the return. Therefore, so long as the assessee pays the tax which according to him is due on the basis of information supplied in the return filed by him, there would be no default on his part to meet his statutory obligation under section 7 o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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