TMI Blog2011 (11) TMI 670X X X X Extracts X X X X X X X X Extracts X X X X ..... sumptive tax of ₹ 1400/- under Section 115N of the Income Tax Act, as it stood at the relevant time on 29.3.1994. A notice under Section 148 of the Act was issued in the year 1997 on which the petitioner informed the Assessing Authority (AO) that he has already deposited ₹ 1400/- with the return. The petitioner, however, submitted another return of income in compliance with the notice under Section 148 and disclosed that on 11.3.1994 he had purchased property worth ₹ 10,25,000/- explaining the source of income from which the property was purchased. On 31.3.1999 the Assessing Officer passed an order under Section 143 (3) read with Section 147 of the Act assessing the petitioner to tax at total income of ₹ 16,63,630 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the source of investment of ₹ 1,66,000/-. On 19.3.2007 after a period of three years CIT (A) passed an order, whereby the gift of ₹ 3 lacs from Smt. Nirmala Devi was added to the income of the petitioner but deduction in respect of ₹ 1,66,000/- was allowed. The petitioner preferred an appeal in the Income Tax Appellate Tribunal, which has by its order dated 7.5.2008 granted a relief of ₹ 3 lacs obtained from Smt. Nirmala Devi but confirmed the addition of ₹ 3 lacs towards loan obtained by the petitioner from 12 persons to the petitioner's taxable income. The Income Tax Officer after the final orders of the ITAT imposed interest of ₹ 4,77,412/- on the petitioner as well as interest under Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of amount on which interest is payable was due to the circumstances beyond the control of the assessee. The assessee's submission in this regard appears to be somewhat genuine; C. the delay in payment of tax in arrears cannot be entirely attributable to the assessee, since this was a case of prolonged adjudication. D. The assessee had cooperated in the entire matter and paid the full demand previously raised on 27.9.2000. After recording these findings in favour of the assessee, the CIT observed that the assessee's contention that the interest under Section 234A be withdrawn as there was no delay is based on representation of incorrect set of facts. The assessee had filed statement of income in Form 4A, which was not the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of 25%. He has relied upon the judgment of the Supreme Court in Kishan Lal v. Union of India Anr. 1998 (230) ITR 85 in which the Supreme Court held that decision taken by the authority under Section 220 (2A) can be subjected to judicial review by filing petition under Art.226 of the Constitution of India. It is imperative for the authority to give some reasons while disposing of the application. In Auro Food Ltd. (Supra) after reiterating the three statutory conditions under Section 220 (2A), the Madras High Court observed that the discretionary power to be exercised by the Commissioner of Income Tax is coupled with the duty to be exercised judicially and reasonably based on relevant facts. The authority concerned should not act as a me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 220 (2A) of the Act. Where the statute prescribes the conditions on which discretion is to be exercised, any deviation from such conditions, on the grounds, which are not relevant without any reference to the statutory conditions, the exercise of power is vitiated. It virtually amounts to supplying the reasons for exercise of powers, which are extraneous to the grounds prescribed by the legislature. Where the statute prescribes the conditions for payment and authorises the rate of interest, the conditions of waiver given in the same statute must be strictly applied in exercising such power. Although the entire Act confers discretionary powers at some or other stage of the assessment, the power to reduce or waive the amount of inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. It is also trite that while two interpretations are possible, the Court ordinarily would interpret the provisions in favour of a tax-payer and against the Revenue. 14. Yet again in J. Srinivasa Rao v. Govt. of A.P. Another [2006 (13) SCALE 27], it was held : In a case of doubt or dispute, it is well-settled, construction has to be made in favour of the taxpayer and against the Revenue. 15. In M/s. Ispat Industries Ltd. v. Commissioner of Customs, Mumbai [JT 2006 (12) SC 379 : 2006 (9) SCALE 652], this Court opined: In our opinion if there are two possible interpretations of a rule, one which subserves the object of a provision in the parent statute and the other which does not, we have to adopt the former, because adopt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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