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2013 (5) TMI 15 - AT - Income TaxRectification of orders - as per assessee AO of recomputing interest u/s 234B at Rs.6,72,07,276 as against Rs.6,59,46,319 charged per order dated 28th March, 2008 passed under section 143(3) i.e. completed assessment - whether the interest payable under section 234B which has to be first adjusted against the payment made under section 140A has to be calculated with respect to total income as declared in the return or total income determined in the regular assessment? - Held that:- In view of the provisions of section 140A r.w.s. 234B, the interest that could have been charged/ adjusted as part of interest under section 234B will have to be calculated on the returned income but not on the basis of assessed income. AO, who originally completed the assessment, has correctly calculated as per the provisions of section, whereas the present AO wrongly interpreted the provisions in the order under section 154. This issue was elaborately discussed in ACIT vs. M/s C.C. Chokshi & Co (2010 (5) TMI 698 - ITAT MUMBAI) wherein held that the interest payable under section 234B for the purpose of adjustment against the tax paid under section 140A has to be computed with respect to assessed tax determined on the basis of total income declared in the return. but only for the limited purpose of adjustment of payment made u/s. 140A against interest payable under section 234B while making computation of interest payable by the assessee which has to be computed with respect to the total income determined in regular assessment as per the definition of assessed tax given in section 234B. Thus the orders of AO under section 154 and the CIT (A) are bad in law. The order under section 143(3) originally passed by AO has correctly worked out the interest under section 234B which has to be upheld. Therefore order u/s 154 passed by AO canceled - Assessee's grounds are allowed.
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