TMI Blog2003 (11) TMI 278X X X X Extracts X X X X X X X X Extracts X X X X ..... evised share in the firm and also charging interest of Rs. 7,632 under section 234B upto the date of the regular assessment of the firm. The assessee moved a rectification petition under section 154 urging that the interest under section 234B should be charged only upto the date of issuance of intimation in his case. The same was dismissed. The first appeal also failed to change the fortune of the assessee. 2.2 Before us, the learned counsel for the assessee opened his arguments by contending that the first appellate authority erred in holding that the interest under section 234B was chargeable upto the date of regular assessment of the firm i.e., M/s. K.T. Oil Mills, Jaitu, in which the assessee was partner. Relying on the provisions of section 234B(1), it was contended that the interest was rightly chargeable upto the date of regular assessment or the date of passing of intimation of the assessee. The learned A.R. raised an additional ground to the effect that no interest under section 234B could have been charged in view of the decision of the Hon'ble Supreme Court in the case of CIT v. Ranchi Club Ltd. [2001] 247 ITR 209. It was contended that in the absence of specific charg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he light of these precedents, it was tendered that the appeal was maintainable and liable to be allowed. 2.5 We have considered the rival submissions in the light of the material placed before us and precedents relied upon. Before going into the merits of the appeal, we would like to examine the preliminary issue of maintainability of the appeal. There is no dispute about the fact that the return was processed under section 143(1) and the returned income was accepted which was below the taxable limit resulting into the position that the amount of advance tax of Rs. 3,200 became refundable together with the interest of Rs. 288. No regular assessment was made in the hands of the assessee partner. Pursuant to the assessment of the firm M/s. K.T. Oils Mills, Jaitu, in which the assessee was partner, an order under section 155 was passed in the case of the assessee wherein the interest under section 234B was charged for the period 1-4-1989 to 31-3-1992 i.e., the date of regular assessment of the firm. The assessee moved an application under section 154 praying for the reduction of interest under section 234B which was rejected. The present appeal is against the order passed by the fir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o nil but that turned into creation of the fresh demand. As the orders under section 154/155 had the effect of reducing refund, in our considered opinion, the appeal was rightly maintainable under clause (f) of section 246(1). We, therefore, hold that the reliance by the learned D.R. on the decision of the Apex Court is misconceived. On the contrary, the decision of the Hon'ble Calcutta High Court in Dibrugarh Co. Ltd.'s case which was rendered after the above noted Apex Court decision clearly upholds the maintainability of appeal in such circumstances. In this case, the Hon'ble Court held that when the interest levied in the assessment order is enhanced by an order of rectification, the appeal is from the order of rectification and as such appeal lies. The other decision in the case of Sarju Prasad having been relied upon by the learned A.R. also fortifies the above said view, in which it was held that the remedy in respect of levy of interest under section 217(1A) for non payment of advance tax was not by an appeal against the regular assessment order but by way of rectification under section 154. In view of these facts, we hold that the appeal was maintainable; for it emanated f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the instant case is at 1-4-1989. The controversy is on the second limb, namely; the terminating point for the charge of interest. Whereas the Assessing Officer charged interest upto 31-3-1992 (i.e. the date of regular assessment of the firm K.T. Oil Mills in which the assessee was partner), the assessee's contention is that it should have been charged only upto the date of intimation passed in the case of assessee himself on 27-12-1989. The learned DCIT(A) while disposing of the appeals of the other two related assessees, which order has been followed in the impugned order found that section 234B did not specify the date of assessment. Going by the "spirit of the section" he came to the conclusion "on equitable consideration" that the date of assessment of the firm should be considered for the charge of interest unless partner's regular assessment is subsequently completed. On the threadbare analysis of sub-section (1) of section 234B, it is found that the interpretation placed by the first appellate authority is not only not in accordance with the provisions but against its mandate. As noted above, the interest is chargeable "to the date of the determination of total income in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the instant appeal, we are concerned only with the period for which interest is chargeable, on which issue, sub-section (4) is not relevant, and only sub-section (1) governs the situation. This contention of the learned D.R., therefore, fails. 3. On the question of the additional ground raised by the assessee for not charging the interest under section 234B in view of Ranchi Club Ltd.'s case, we find that the facts are little different. Initially intimation under section 143(1) was issued in which the returned income of Rs. 9,690 was accepted. Since this amount was below taxable limit, there was no question of charging interest under sections 234A to 234C. Despite that it is manifest from the copy of the intimation under section 143(1) that a separate column is made for the charge of interest under these sections against which the Assessing Officer has mentioned the word 'Nil'. Thereafter, when the order under section 155 was passed, the learned Assessing Officer charged interest under section 234B. It was fairly admitted by the learned A.R. that the mention of charging interest under section 234B in the notice of demand was made which was accompanying the order under section 155 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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