TMI Blog2012 (5) TMI 361X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue would also contend that the waiver of interest was limited to that remaining unpaid since the amount adjusted cannot be taken to be having been paid - Decided in favor of the assessee - 20365 of 2005 - - - Dated:- 21-11-2011 - VINOD CHANDRAN K., J. JUDGMENT K. Vinod Chandran J.- 1. The petitioner, being the legal heir of the deceased assessee, filed an application under section 220(2A) of the Income-tax Act, 1961, which was considered by the Commissioner by exhibit P5 order, limiting the waiver to an amount of Rs. 24,408 which was the balance amount due from the deceased assessee. 2. The assessment for the assessment year 1989-90 completed under sec- tion 143(3) determining the total income was later revised red ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On admitted facts, the interest under sections 234A, 234B and 234C imposed at more than the tax due was waived by the Chief Commissioner, while the amounts were being deposited in instalments by the petitioner. The petitioner was paying the instalments on behalf of the assessee who died on October 22, 1996. It was in the context of the above payment of certain instalments and the refund consequent to the subsequent waiver that the said amounts were adjusted towards the interest under section 220(2A). I am unable to agree with the contention of the Revenue that the adjustment would take it out of the ambit of section 220(2A), since the same cannot be said to have been paid by the assessee or on her behalf by the legal heirs. Section 220(2A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... each case which satisfaction was entered by the Commissioner. However, there is no reason stated to limit the waiver to the amounts remaining due and payable. Section 220(2A), as it stood before the amendment of 1984, contemplated waiver of interest payable by the assessee and sub-section (1) also related to the hardship caused in further payment of the amount remaining unpaid. However, by the Taxation Laws (Amendment) Act, 1984, the provisions have been suitably amended with retrospective effect from October 1, 1984, conferring power on the Chief Commissioner or the Commissioner to reduce or waive the amount of interest already paid and the conditions have also been suitably amended to bring in those amounts which has already been paid. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Commissioner impugned in this writ petition. The Commis- sioner merely says that "payment of further interest will cause hardship to them" and does not state any reason for limiting or reducing the waiver. The learned standing counsel for the Revenue also placed reliance on the decision in Kerala State Cashew Development Corporation Ltd. v. ITO [1990] 186 ITR 521 (Ker). The dictum laid down in the said case is that can- cellation of penalty does not ipso facto result in total waiver of interest since the former is punitive and the latter is compensatory. The same is not relevant in the facts of the instant writ petition since the Commissioner's order is found improper by this court to the extent it limits the waiver for reason of total a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action that the three conditions laid down therein have been fulfilled before passing an order waiving interest." (emphasis supplied) 12. In the instant case, what was stated by the Commissioner was that certain amounts were already paid by way of adjustment or otherwise and that certain amounts remained unpaid. The standing counsel for the Revenue would also contend that the waiver of interest was limited to that remaining unpaid since the amount adjusted cannot be taken to be having been paid. The section not having made any such distinction, as found earlier, and by virtue of the amendment entitling both paid and unpaid interest to be considered for waiver ; I am of the opinion that the discretion has not been properly exercised by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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