TMI Blog2010 (6) TMI 633X X X X Extracts X X X X X X X X Extracts X X X X ..... ed compensation has been assessed, in consequence to which the respondent have been held liable for levy of interest under section 234A of the Act on account of belated filing of the income-tax returns and under section 234B of the Act for shortfall in payment of advance tax. It was a common ground between the parties that facts and circumstances in all the appeals are identical, therefore, we take up for discussion the facts as emerging from ITA No. 613/Chd./2010 in the case of Shri Raghuvir Singh, HUF pertaining to the assessment year 1988-89. 3. In this case, brief facts relating to imposition of interest under section 234B of the Act in the impugned order of the Assessing Officer dated 24-12-2009 are as under. The Assessing Officer issued notice under section 148, read with section 150(1) of the Act on 12-1-2007. In the return of income filed on 30-11-2007, during the consequent assessment proceedings, assessee declared interest income of Rs. 13,713, which represented interest received along with enhanced compensation. In an assessment finalized under section 144 of the Act on 12-12-2007, the income on account of interest on enhanced compensation was determined at Rs. 85, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yana Warehousing Corporation [2005] 1 SOT 258 (Chd.) has held that sections 234A and 234B in clear terms impose a mandate to collect interest and the Assessing Officer has no jurisdiction to consider as to whether there is reasonable cause for non-payment of advance tax or not but to levy interest." Which have been supported by the learned DR on the basis of the order of the Assessing Officer. As per the Assessing Officer, the assessee could not claim that he did not know about the enhancement of compensation because the same could have been visualized, as assessee himself had made a claim for enhancement. Learned DR relied upon the decision of the Chandigarh Bench of the Tribunal in the case of Dy. CIT v. Haryana Warehousing Corpn. [2005] 1 SOT 257 and also the decision of the Delhi Bench of the Tribunal in the case of Ashwani Dhingra v. Addl. CIT [2009] 119 ITD 88. Learned DR has also submitted that in this case, the assessee had himself declared interest income in his return, albeit of a lower amount. It was, therefore, contended that the levy of interest under section 234B has been wrongly set aside by the CIT ( Appeals). 6. On the other hand, learned counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ually correct that the assessee or any of other family members were hitherto not assessed to tax, being agriculturists. The agricultural land belonging to the respondents at Village Hallo Majra were acquired by the Chandigarh Administration on 22-11-1985 by issuance of a Notification under section 4 of the Land Acquisition Act, 1894. Original compensation was awarded through an award by the Land Acquisition Collector on 30-3-1987. This award was further enhanced by the order of the District Judge, Chandigarh, dated 29-10-1996, who also awarded interest on such enhanced compensation. Thus, prior to such development, assessee was not even aware of the interest income in question. Under such circumstances, the liability to pay interest under section 234B of the Act in each of the captioned assessment years, in our view does not arise, following the observations of the Delhi High Court in the case of Anand Parkash ( supra ) reproduced hereinafter : "11. The last issue in the impugned proceedings relates to the charging of interest under sections 234B and 234C of the Act for the assessment years 1993- 94 to 2001-02. On this aspect, the learned counsel for assessee submitted that dur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... poses to do in the facts and circumstances of the cases is to charge interest for the default in payment of advance tax in the years in question. It can only justify such a levy of charge if sit has suffered a loss. This follows from the conclusion that the levy of interest under section 234B is compensatory in nature. The fact remains that no money belonging to the Government was withheld by the assessee in the years in question. In fact, the interest payable on account of enhanced compensation was not even known to the assessee till much later. How could the assessees then be expected to have paid advance tax on something which had not been received by the assessees and which would not have even been in their contemplation. In other words, the assessee could not have included the interest received on enhanced compensation in the assessment years under consideration while estimating his income for the purposes of calculation of advance tax for the relevant years. It is a well-known principle that the law cannot compel anyone to do the impossible. The Government itself, on the one had delayed the payment of compensation to the assessees and on the other, it expects to levy interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to the Hon ble High Court, at the relevant point of time, it was not possible for the assessee to foresee the decision of the Hon ble Supreme Court. Under these circumstances, the Hon ble High Court held that before invoking section 234B of the Act, it is essential to see whether the assessee comes within the sweep of the said section. 8. Though the revenue is justified in stating that charging of interest under section 234B/234C is mandatory, so, however, it becomes mandatory only in situations where it can be established that provisions relating to payment of advance tax are otherwise per se attracted in a given case. In the present case, having regard to the fact that the assessee became entitled to the impugned income on a much later date, it cannot be concluded that the assessee was liable to pay advance tax at the relevant point of time so as to attract the provisions of section 234B of the Act for such failure. In other words, at the relevant point of time, contained in section 210 of the Act, the assessee was under no liability to pay advance tax and, therefore, the assessee would not come within the ambit of section 234B of the Act. The CIT (Appeals), in our view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Corpn. ( supra ). The ld. counsel contended that the stated decision is not found reported in the book as mentioned. Learned DR was allowed opportunity in this regard but no satisfactory reply has been furnished and in any case, without proper citation of the case or, its copy being available, it is not possible to peruse the same. Therefore, reference to the stated decision in the Ground of Appeal is ignored. 11. In view of the aforesaid discussion, in our view, the CIT (Appeals) made no mistake in deleting the levy of interest under section 234B of the Act. 12. Insofar as the levy of interest under section 234A of the Act for the delay in filing of the returns is concerned, the CIT(A) has deleted the same in all the years for the reason that the assessee voluntarily filed the returns on 31-3-2001. As per the CIT(A) voluntarily returns were filed to claim refunds of the Tax Deducted at Source (TDS), though the declared income was less than the taxable limits. According to him, it does not make any difference that in the subsequent assessments, the assessed income became taxable. In this scenario, we have heard the rival counsels who have made their respective submiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d where a regular assessment is made, on the amount of tax determined on total income under such regular assessment. It is also provided that where, in relation to an assessment year, an assessment is made for the first time under section 147 of the Act or under section 153A of the Act, the assessment so made shall be regarded as a regular assessment for the purposes of the section. 15. In the present case, Assessing Officer has held the assessee liable for payment of interest on the ground that return of income has not been filed within the period stipulated under section 139(1) of the Act. As per the revenue, assessee was required to file the return of income for the assessment year 1988-89 within the due date prescribed under section 139(1) of the Act, i.e., 31-7-1988. Factually, the assessee filed a return of income on 30-11-2007 in the course of proceedings initiated by issuance of notice under section 147/148 of the Act on 12-1-2007, which culminated in assessment on 12-12-2007 under section 144, read with section 148, of the Act, in which the only income assessed in the hands of the assessee is a sum of Rs. 85,550 on account of interest on enhanced compensation. In thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hanti Sarup Sharma v. CIT [1999] 237 ITR 376 (Punj. Har.), the Hon ble High Court was dealing with a similar situation wherein the assessee had received compensation after the specified date for filing returns and, therefore, the return showing receipt of interest on enhanced compensation was filed belatedly. The Assessing Officer charged interest for the delay starting from the period immediately after the due date specified for filing of the return of income. The Hon ble High Court disagreed and held that the interest be levied only for the period after the receipt of the income and ending up to the date of filing of return by the assessee. In our considered opinion, both the aforesaid judgments, lay down a proposition that if at the time of the date specified for filing of return, assessee could not anticipate receipt of an income, and this leads to a delay in filing of the return of income, interest cannot be levied for the delay in the filing of the return attributable to non-anticipation of such income. Though, in both the judgments, assessee s therein had voluntarily filed the returns, which in the present case has been filed only after initiation of proceedings under s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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