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2016 (7) TMI 1600 - AT - Income TaxCharging of interest u/s 234C - point of dispute by the assessee is that while processing such return under section 143(1) interest u/s 234C was levied on account of shortfall in payment of advance tax on first and second installments, due on 15/09/2011 and 15/12/2011, in respect of gift of ₹ 10.00 crores claimed to have been received on 17/12/2011 - HELD THAT:- Section 209 of the Act provides the computational mechanism of calculating advance tax to be paid. Notably, section 209 envisages calculation of advance tax based on the ‘estimate of current income’ . A reading of section 209 would reveal that in order to calculate the amount of advance tax payable, an assessee is liable to estimate his income. Facts of the present case clearly show that the gift of ₹ 10.00 crores, which has been received by the assessee on 17/12/2011 could not have been foreseen by the assessee so as to enable him to estimate such income for the purpose of payment of advance tax on an anterior date, may it be 15/09/2011 or 15/12/2011. In such a situation, the decision of the Hyderabad Bench of the Tribunal in the case of ACIT v. Jindal Irrigation Systems Ltd. [1995 (8) TMI 97 - ITAT HYDERABAD-A] relied upon by the appellant, clearly militates against charging of interest under section 234C of the Act. Therefore, in this background, the levy of interest under section 234C of the Act in the present case is untenable. Plea of the Revenue that charging of interest under section 234C of the Act is mandatory in natures is concerned, the same in our view, cannot lead to a situation where levy of interest can be fastened even in situations, where there is impossibility of performance by the assessee. Charging of interest would be mandatory, only if, the liability to pay advance tax arises upon fulfilment of the parameters, which in the present case is not fulfilled on account of the peculiar fact situation. Thus, such plea of the Revenue is untenable. Decided in favour of assessee.
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