TMI Blog2016 (2) TMI 755X X X X Extracts X X X X X X X X Extracts X X X X ..... holly impermissible in law. In case of Commissioner of Income Tax vs. Anjum M.H.Ghaswala and ors. [2001 (10) TMI 4 - SUPREME Court] held that charging of interest under Section 234A, 234B and 234C of the Act is mandatory. The Court opined that the word “shall” in the said section cannot be construed as “may”. Earlier, expression used “may” was substituted by the word “shall” giving clear indication of the intention of the legislature to make the collection of statutory interest mandatory by a peculiar device. CIT (Appeals) as well as the Tribunal, in the present case, made such mandatory requirement otios. The assessee had not paid the self assessed tax. To the extent of shortfall, it was liable to pay interest. Such interest liability c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer to adjust such refund in respect of the other two assesses against the shortfall of the tax of the assessee and the same as having been paid in terms of Section 140A of the Act. The Assessing Officer refused to grant such prayer. In appeal before the Commissioner (Appeals), however, when the assessee repeated such request, the appellate Commissioner observed as under: 4.1 I have given a careful consideration to the submissions of the learned counsel and have gone through the facts. It is true that merely on filing a return of Income a refund is not created. Refund is created only when the assessment is completed and only thereafter the refund can be adjusted against any demand on the request of the party. Thus technically speaking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the refunds of the other two firms as the payment of tax u/s. 140A of the Act. The CIT(A) has relied upon the aforesaid finding in the interest of justice for which the revenue should not have any grievance. Accordingly, we are not inclined to interfere with the finding recorded by the CIT(A). 4. It is in this background that the Revenue has sought and has been granted the said reference. We have heard learned counsel for the Revenue. Though served, no one appeared for the respondent. In our opinion, the CIT(Appeals) as well as the Tribunal committed a serious error in granting the request of the assessee. Facts are eloquent. The assessee had not paid tax in terms of Section 140A of the Act which requires the assessee to pay tax on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atory. The Court opined that the word shall in the said section cannot be construed as may . Earlier, expression used may was substituted by the word shall giving clear indication of the intention of the legislature to make the collection of statutory interest mandatory by a peculiar device. CIT (Appeals) as well as the Tribunal, in the present case, made such mandatory requirement otios. The assessee had not paid the self assessed tax. To the extent of shortfall, it was liable to pay interest. Such interest liability could not have been waived by making adjustment of any possible refund in cases of assessments of other assesses. The reference is, therefore, answered in the affirmative, in favour of the Revenue and reference is dispo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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