TMI Blog2011 (11) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... n 234A, 234B and 234C in whole or in part. In the present case, if deemed appropriate, the appellant can make an application. The substantive question of law is answered against the assessee. - ITA NO.1013/2011 - - - Dated:- 30-11-2011 - MR. JUSTICE SANJIV KHANNA, MR. JUSTICE R.V. EASWAR, JJ. For Appellant: Mr. Ajay K. Aren with Mr. Achin Aren, Advs. For Respondent: Mr. Anupam Tripathy, sr. standing counsel SANJIV KHANNA,J: (ORAL) By order dated 17th August, 2011 the following substantial questions of law were framed : 1. Whether the learned Tribunal had erred in interpretation of the letter dated 04.11.2004 issued by the Principal and consequently upholding the interest charged by Assessing Officer under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the letter dated 4.11.2004 was received by them. It is accordingly submitted that the assessee had bonafidely paid their advance tax as per their tentative estimates and once the letter dated 4.11.2004 was received by them, the appellant accordingly, had paid advance tax of Rs.1,25,00,000/- on 14.12.2004. 4. Section 234C postulates payment of interest on deferment of payment of advance tax. The said provision reads as under: (1) Where in any financial year, - (a) The company which is liable to pay advance tax under section 208 has failed to pay such tax or - (i) The advance tax paid by the company on its current income on or before the 15th day of June is less than fifteen per cent of the tax due on the returned income or the amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hirty per cent of the tax due on the returned income or the amount of such advance tax paid on or before the 15th day of December is less than sixty per cent. of the tax due on the returned income, then, the assessee shall be liable to pay simple interest at the rate of one and one-half per cent. per month for a period of three months on the amount of the shortfall from thirty per cent or, as the case may be, sixty per cent. of the tax due on the returned income; (ii) The advance tax paid by the assessee on his current income on or before the 15th day of March is less than the tax due on the returned income, then, the assessee shall be liable to pay simple interest at the rate of one and one-half per cent on the amount of the shortfall fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ple of pay as you earn‟. It is collected even before the income tax becomes payable and the installments are payable during the financial year itself. Deferment in payment of installment of advance tax i.e. failure to pay particular percentage/amount of advance tax as stipulated in Section 211, attracts interest under Section 234C of the Act. The aforesaid section along with Sections 234A and 234B were inserted by Direct Tax Laws (Amendment) Act, 1987 w.e.f. 1st April, 1989, with a view to simplify and remove discretion of the assessing authorities which had led to litigation and consequent delays in realizing dues. Earlier, the authorities had discretion not to levy interest on deferment of payment of advance tax on just or sufficie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act to show that the expression shall used in sections 234A, 234B and 234C is used by the Legislature deliberately and it has not left any scope for interpreting the said expression as may . This is clear from the fact that prior to the Amendment brought about by the Finance Act, 1987, the Legislature in the corresponding section pertaining to imposition of interest used the expression may thereby giving a discretion to the authorities concerned to either reduce or waive the interest. The change brought about by the Amending Act (Finance Act, 1987) is a clear indication of the fact that the intention of the Legislature was to make the collection of statutory interest mandatory. 7. Once it is held that interest under Section 234 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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