TMI Blog2007 (9) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... engaged in the manufacturing of electronic goods such as television sets, video cassette recorders and the like, was assessed to a loss of Rs.5,91,110 for the assessment year 1976-77. For the next two assessment years 1977-78 and 1978-79 the Assessee filed returns showing loss of Rs.2,28,100 and Rs.9,828 respectively. For the assessment year 1979-80 the Assessee filed a return declaring an income of Rs.3,82,484. By the assessment order dated 27.3.1982 the Asssessing Officer assessed the total income at Rs.6,58,140 and charged interest under Section 139(8) and Section 217 of the Act since the Assessee had not filed the statement of income or estimate of income for the said assessment year i.e. 1979-80 under Section 209A of the Act. 3. The Assessee's appeal was disposed of by the Commissioner of Income Tax (Appeals) ['CIT(A)'] by an order dated 31.12.1982 in which the CIT(A) held that no estimate was called for under Section 209A. The CIT(A) noted that despite this objection having been raised before the Assessing Officer, no findings had been given. Therefore, the said issue was restored to the file of the Assessing Officer for a fresh decision. 4. The Assessee filed an applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the other hand submitted that the Central Board of Direct Taxes (CBDT) in a Circular [reported in[1979] 117 ITR (Statutes) 17] clarified that the statement of advance tax would be required to be filed by an assessee only when there was a positive income. He points out that where the regular assessment was at a loss for the year 1976-77 and in the immediate following years also the Assessee filed a loss return, the question of computation of advance tax in terms of Section 209(1) of the Act did not arise. If there was no liability to pay advance tax, the Assessee was not required to file a statement as required by Section 209A. He further pointed out that Section 209A(4) would get attracted only if the Assessee is in the first place liable to pay advance tax under sub-section (1) or sub-section (2) of Section 209A as the case may be. He sought to place reliance on the decision of the Bombay High Court in Patel Aluminium Pvt. Ltd v. Miss K.M.Tawadia, Income Tax Officer (1987) 165 ITR 99 of the Calcutta High Court in Commissioner of Income-Tax v. Indian Molasses Co. (P.) Ltd . (1993) 200 ITR 149 and of the Gujarat High Court in Commissioner of Income-Tax v. Gujarat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee under section 140A exceeds the total income referred to in clause (a), or (ii) the Income-tax Officer makes an amended order referred to in sub-section (3) of section 210 on the basis of the total income on which tax has been paid by the assessee under section 140A, the total income referred to in clause (a) shall be substituted,- (1) in a case falling under sub clause(i), by the total income on the basis of which tax has been paid under section 140A, and (2) in a case falling under sub-clause (ii), by the total income on the basis of which the amended order under sub-section (3) of section 210 is made.] Explanation: If the assessee is a partner of a registered firm and an assessment of the firm has been completed for a previous year later than the latest previous year for which the assessee's assessment has been completed; his share in the income of the firm shall, for the purposes of [clause(a)], be included in his total income on the basis of the said assessment of the firm. [(2) xxxxxx (3) xxxxxx 209A [Computation and payment of advance tax by assessee. (1) Every person shall, in each financial year, [on or] before the date on which the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e may be, sub-section (3), if, by reason of the current income being likely to be greater than the income on which the advance tax so payable by him has been computed or for any other reason, the amount of advance tax computed in the manner laid down in section 209 on the current income (which shall be estimated) by the assessee) exceeds the amount of advance tax so payable by him by more than 33 per cent of the latter amount, he shall [on or] before the date on which the last instalment of advance tax is payable by him, send to the Income-tax Officer an estimate of__ (i) the current income, and (ii) the advance tax payable by him on the current income calculated in the manner laid down in section 209, and shall pay such amount of advance tax as accords with his estimate on such of the dates applicable in his case under section 211 as have not expired, by instalments which may be revised according to sub-section (5): Provided that in a case where the Commissioner is satisfied that, having regard to the nature of the business carried on by the assessee and the date of expiry of the previous year in respect of such business, it will be difficult for the assessee to furnish the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u of such statement referred to in sub-section (2) of that section ; or (b) that any such person as is referred to in clause (b) of sub-section (1) of section 209A has not sent the estimate referred to in that clause, simple interest at the rate of fifteen per cent per annum from the 1 st day of April next following the financial year in which the advance tax was payable in accordance with the said [sub-section (1) or sub-section (2)] up to the date of the regular assessment shall be payable by the assessee upon the amount equal to the assessed tax as defined in sub-section (5) of section 215." 10. A reading of the provision in 209A (1) no doubt casts an obligation on an assessee who is in the relevant previous year assessed to a positive income to file a statement of advance tax and also to pay the advance tax. Section 209A(1)(a) requires that the advance tax payable should be computed in the manner laid down in S. 209(1) or as the case may be Section 209(1)(d). In terms of Section 209(1)(a) the total income of the ?latest previous year in respect of which the Assessee has been assessed by way of regular assessment shall first be ascertained?, is the starting point for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ms. Bansal that the above decisions do not account for Section 209(1)(c) under which the current income computed in terms of Section 209A(4) can be substituted for the total income under Section 209(1)(a) of the Act and the advance tax worked out on that basis would have to be deposited by the Assessee along with the statement under Section 209A(1)(a) of the Act. As pointed out by Mr. Sethi, a similar contention raised before the Calcutta High Court was rejected by it in the decision in Indian Molasses Co. (P.) Ltd .[1993] 200 ITR 149. The relevant portion in that regard reads as under (ITR, p.152): "Mr. Bagchi has raised another contention. According to him, the provisions of sub-section (4) of section 209A will be attracted to the facts of this case. Sub-section (4) applies in the case of an assessee who is liable to pay advance tax under sub-section (1) or sub-section (2) or, as the case may be, sub-section (3). It is obligatory on a taxpayer to pay a higher amount of advance tax if the advance tax computed on his estimated current income is likely to exceed the amount of advance tax payable according to the statement or estimate by more than thirty three and one by three ..... X X X X Extracts X X X X X X X X Extracts X X X X
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