TMI Blog2017 (6) TMI 736X X X X Extracts X X X X X X X X Extracts X X X X ..... e, there was no short fall as per the statutory provisions prevailing. No interest can be charged on the ground that by virtue of subsequent amendment with retrospective effect the tax liability arose, the law does not expect the person to perform the impossible. This is precisely what the Division Bench of Kolkata High Court in the case of Emami Ltd. v. Commissioner of Income Tax (2011 (6) TMI 163 - CALCUTTA HIGH COURT ) had held. The assessee cannot be branded as a defaulter in payment of advance tax and it would be nevertheless asked to pay interest in terms of Section 234B and Section 234C of the Act for default in making payment of tax in advance which was physically impossible - Decided in favour of assessee. Appeal is admitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll of payment of advance tax. It is undisputed that such short fall occurred due to the liability, which arose on account of retrospective amendment. Explanation 6 to Section 43(6) of the Income Tax Act, 1961, was inserted by Finance Act 2008 with retrospective effect from 01.04.2003. This explanation essentially provided for computing the actual cost of asset, the depreciation allowed on such asset etc., in case of assessee who was not required to compute the total income for the purpose of the act for any previous year or years. It is not necessary to go into the nitigrity of explanation of this provision. Suffice it to record that for the assessment year 2008-09 which is under consideration, the assessee had paid advance tax, which was l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act, thus, advance tax is payable in respect of total income of the assessee, which would be chargeable to tax in the assessment year immediately following the financial year in question. Thus, the computation of advance tax would be made in advance and deposited with the Government Revenue as per the provisions contained in the said chapter. In absence of the amendment in Section 43(6) of the Act, at the relevant time no liability to pay tax in case of assessee existed. Such liability arose by virtue of a subsequent amendment brought into the statute with retrospective effect. Therefore, at the relevant time when liability to pay advance tax arose, there was no short fall as per the statutory provisions prevailing. No interest can be c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... observations of the Supreme Court in the case of Star India P.Ltd. v. CCE reported in [2006] 280ITR321(SC), strongly relied upon by Mr.Bajoria, where the apex court in the context of imposition of service tax by the Finance Act, 2002 with retrospective effect held that the liability to pay interest would arise only on default and is really in the nature of quasipunishment and thus, although the liability to pay tax arose due to retrospective effect of law, the same should not entail the punishment of payment of interest. 15 Although Mr Nizamuddin, the learned counsel appearing on behalf of the revenue, in this connection, strongly relied upon the decision of the Supreme Court in the case of Joint CIT v. Rolta India Ltd. Reported in [2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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