TMI Blog2001 (2) TMI 317X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee paid the advance tax and TDS as under: 10-9-1988 Rs. 13,000 12-12-1988 Rs. 21,000 14-3-1989 Rs. 26,900 TDS on contract Rs. 3,150 ---------- Rs. 64,050 ---------- Thus, the advance tax paid and the TDS deducted was more than the tax payable on the returned income. However, the Finance Act, 199G, inserted cl. (iiib) in s. 28 and cl. (vb) in s. 2(24) by virtue of which the receipts on account of export incentives in the nature of cash assistance was made retrospectively taxable as business income w.e.f. 1st April, 1967. Because of this amendment, the AO made an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that the interest had been levied only because of the amendment to the Act with retrospective effect; otherwise such interest was not chargeable at all. The assessee at the time of paying the advance tax could not anticipate such an amendment and, therefore, the advance tax fell short of the assessed tax. The learned Counsel further submitted that the CIT(A) erred in holding that there is no appeal which lies against charging of interest under the present sections and in this context, the learned CIT(A) did not follow the decision of the Hon'ble Supreme Court in the case of Central Provinces Manganese Ore Co. Ltd. vs. CIT (1986) 58 CTR (SC) 112 : (1986) 160 ITR 961 (SC) on the reasoning that the decision is covering interest under s. 215 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the assessed tax. In our view, the CIT(A) is not justified in holding that there is no appeal which lies against charging of interest under the present sections because it is to be noted that exactly same issue was before the Hon'ble Supreme Court in the case of Central Provinces Manganese Ore Co. Ltd. In that case, the question was relating to interest under s. 139(8) and 215 but the position of law was same as it is obtained today because s. 246 did not provide any appeal specifically against the orders under s. 139(8), 215, etc. In view of that position in law, the Hon'ble apex Court while upholding that there is a right of appeal provided the assessee challenges the basic levy has held as under on p. 966 of 160 ITR. "Now, the que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee in any case could not have anticipated such retrospective amendment while paying advance tax, it was guided by various decisions obtained at that time that cash compensatory support was not taxable. For example, the Special Bench in the case of Gedore Tools Ltd. vs. IAC (1988) 25 ITD 193 (Del)(SB) had held that cash compensatory support was not taxable. Again the Hon'ble Supreme Court in the case of CIT vs. Hindustan Electro Graphites Ltd. (2000) 160 CTR (SC) 8 : (2000) 243 ITR 48 (SC) dealt with the levy of additional tax exactly on same facts, i.e., after addition of cash assistance because of the retrospective amendment. In that context, the Hon'ble Supreme Court held that the Department is not justified in levying addition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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