TMI Blog1955 (1) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... mensem. On 11th March, 1949, the ITO refused to grant time as the assessee made default in the payment of tax. On 19th March, 1949, the ITO levied a penalty of ₹ 2,000 and called upon the assessee to pay up the tax and penalty by 25th March, 1949. After giving some extensions of time for the payment of the balance the ITO on 28th March, 1949, levied a further penalty of ₹ 25,000. On 25th April, 1949, the assessee sent to the ITO a cheque for ₹ 25,000 towards penalty and a further cheque for ₹ 30,000 in part payment of the tax due. The CIT, Madras, by his order, dt. 2nd May, 1949, permitted the assessee to pay the balance of tax in monthly instalments of ₹ 40,000. On 21st April, 1949, the assessee filed two appeals to the AAC, 'A' Range, Madras, against the said penalties of ₹ 2,000 and ₹ 25,000 imposed on him under S. 46(1) of the IT Act. The AAC, by his order, dt. 19th Oct., 1949, disposed of the appeals. He confirmed the imposition of penalty of ₹ 2,000 but cancelled the penalty of ₹ 25,000. It may be mentioned that, by that date, the assessee had paid all the amounts due from him in accordance with the terms of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f time within which such appeal shall be filed. To read the two sub sections as dealing with a right of appeal at two different points of time is not only illogical but will lead to anomalies. An aggrieved party may file an incompetent appeal to satisfy the period of limitation with an off chance of paying the arrears at any time before the appeal is disposed of. The maintainability of the appeal would then depend upon the fortuitous circumstance of the posting of the appeal for hearing before or after the payment of the tax. We would, therefore, hold that an appeal presented within the meaning of sub s. (2) of S. 30 should comply with the condition laid down in the proviso to sub s. (1). (4.) RELIANCE is placed upon the judgment of the Orissa High Court in Ramanarayana Das Madanlal vs. CIT (1950) 18 ITR 660 (Ori). There, the petitioner was assessed to income tax on 30th May, 1944. As he failed to pay the same, he was ordered to pay certain penalty under S. 46 of the Act. He filed an appeal on 5th July, 1944. According to the order of the ITO, the petitioner should pay the balance of tax by 13th July, 1944. The appeal came up for disposal before the AAC on 10th Sept., 1944. Mean ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r cause such enquiry to be made and subject to the provisions of the Act may pass such order thereon, not being an order prejudicial to the assessee, as he thinks fit. It follows that, on 2nd May, 1949, the unconditional demand for the payment of the entire tax by the ITO was modified by the competent revisional authority, the Commissioner. The result was as if the original demand itself contained a direction for the payment of the amount in the prescribed instalments. The question, under those circumstances, is whether the tax has been paid within the meaning of the proviso to S. 30(1) at the time the appeal was filed. The answer turns upon the meaning of the word tax . Does that word mean the entire tax assessed or does it mean the tax due for payment? If it was the former, undoubtedly the assessee did not pay it. If it was the latter, the entire tax was not due on the date the appeal was filed, for, in accordance with the modified order, the further instalments did not fall due by that date. (5.) THE observations made by the learned Judges in Ramanarayana Das Madanlal vs. CIT (supra), may usefully be referred to at this stage. At page 662, the learned Judges observed : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or is it ₹ 5,000 per month as and when the instalments due? Answering that question at page 543, the learned Judge says: It seems to me that after the Certificate Officer has allowed instalments at ₹ 5,000 per month the assessee has the right to pay only ₹ 5,000 per month and the IT authorities would be under an obligation to take, so long that order stands, only at such instalments. If that is so, then the ITO cannot direct the debtors of the assessee to pay anything more than at the rate of ₹ 5,000 per month, and it was incumbent on the ITO at least to amend his notice accordingly. The position, it seems to me, would be entirely anomalous if, on the one hand, the Collector, who is authorised to do so, allows the assessee to pay in certain instalments, but the ITO issues notices for payment of the entire sum all at once. The expression 'amount due' in this case to my mind must mean the amount of instalments as and when they become due. (6.) THOUGH in the proviso to S. 30, the word due is absent, the words tax has been paid mean only that the tax due has been paid. The legislature could not have intended to compel a party to pay ..... X X X X Extracts X X X X X X X X Extracts X X X X
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