TMI Blog2013 (2) TMI 780X X X X Extracts X X X X X X X X Extracts X X X X ..... years for the entire block period and surcharge should be levied from the inception of Chapter XIVB of the Act? 3. Whether the Tribunal was correct in holding that interest under Section 158BFA(1) of the Act is compensatory in nature and cannot be levied if the return of income is not fled within the due date as contemplated in the notice? 2. As the question, arising out of the order passed by the Tribunal in the context of it having dismissed the appeal of the Revenue by holding that not only levy of surcharge was not justified as the search was conducted on 27.11.2001 i.e., prior to introduction of proviso to Section 113 of the Act with effect from 1st June 2002 and also declined to interfere with the view taken by the Commissioner of appeal holding that the levy of interest under Section 158B(a) can only be after giving credit to the amount of cash seized during the search and retained by the Revenue with them from the date of seizure. 3. The Tribunal also opined that levy of interest under Section 158BFA(1) one being basically a measure of compensatory levy and the extent of seized amount was available with the Revenue and on such part of the seized amount no inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... every month or part of a month comprised in the period commencing on the day immediately following the expiry of the time specified in the notice, and- (a) where the return is furnished after the expiry of the time aforesaid, ending on the date of furnishing the return; or (b) where no return has been furnished, on the date of completion of assessment under clause (c) of section 1 58BC. (2) The Assessing Officer or the Commissioner (Appeals) in the course of any proceedings under this Chapter, may direct that a person shall pay by way of penalty a sum which shall not be less than the amount of tax leviable but which shall not exceed three times the amount of tax so leviable in respect of the undisclosed income determined by the Assessing Officer under clause (c) of section 158BC. And therefore it is a statutory levy and there is no scope for the Tribunal or other authorities to interpret the statutory levy of interest as one not warranted in the present case as it is only a compensatory levy and there being no loss to the revenue, to the extent of the cash and jewellary seized during search and held with the department. 8. It is obvious from this, that levy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1922, or under sub-section (1) of section 142 of this Act was issued to produce, or cause to be produced, any books of account or other documents has omitted or failed to produce, or cause to be produced, such books of account or other documents, as required by such summons or notice and the said books of account or other documents have been taken into custody by any officer or authority under any other law for the time being in force, or (b) any books of account or other documents will be useful for, or relevant to, any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act and any person to whom a summons or notice as aforesaid has been or might be issued will not, or would not, produce or cause to be produced, such books of account or other documents have been taken into custody under any other law for the time being in force, or (c) any assets represent either wholly or partly income or property which has not been, or would not have been, disclosed for the purposes of the Indian Income-tax Act, 1922 (11 of 1922), or this Act by any person from whose possession or control such assets have been taken into custody by any officer or authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iability and thereafter only interest should have been levied. 15. We are unable to accept this submission of Sri Ashok A Kulkarni for more than one reason. Firstly, the levy of interest is as per the statutory provision under Section 158BFA(1) of the Act and this is not linked to the date of payment of tax in case of delayed filing of the return after receipt of notice under Section 158BC of the Act and is only linked to delay in filling of return. 16. The delay in filing the return is not in dispute in the present case. As per quantification of interest the interest is at 2% on the tax as determined for each month. That means it is with reference to determination of liability towards tax for the block period as per Clause (a) (i) of Section 158BC of the Act and it is thereafter application of the assets seized under Section 132 or requisitioned under Section 132A shall be dealt with. Section 132 and Clause (b) and (c) of Section 158BC of the Act reads as under: 132B Application of seized or requisitioned assets-(1) The assets seized under section 132 or requisitioned under section 132A may be dealt with in the following manner, namely:- (i) The amount of any exist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17. The adjustment of liability as determined under Clause (c) follows determination of tax liability and therefore is not in any way providing for reducing tax liability before quantification of the tax liability. Application in terms of Section 132B is thereafter. It is for this reason we cannot accept the contention of learned Counsel for the Assessee that before levying of interest the amount should have been adjusted from out of the tax liability amount as available from the seizure should have been reduced from the tax liability, then balance interest computed. 18. While on facts we notice that the amount even if reduced from tax liability hardly make any difference m the present case. 19. Even according to Sri K.V. Aravind learned Counsel for the appellant the seizure amount amounts to ₹ 2,39,732/- as against the tax liability of ₹ 13,13,07,047/-, this amount can be significant or insignificant, but nevertheless we are unable to agree with the argument that the levy of interest should have been after reducing the amount in terms of Section 132B of the Act. 20. Section l32B is for the purpose of realization of the tax liability and not on such levy of ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
