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TMI Blog2005 (10) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... ent in the case of the respondent-assessee for the assessment year 1978-79 was completed on a total income of Rs. 16,79,938, after June 15,1979; i.e., after the last date on which the assessee was required to file the statement of its income exigible to advance tax in terms of the provision of section 209A for the assessment year 1979-80. The assessee did not pay advance tax during the financial year 1979-80. However, the assessee chose to file Form No. 28A, showing a loss of Rs. 2,500. This was on the basis of the assessment made for the assessment year 1977-78 which had resulted into negative income. The assessee filed a return later on in the year 1979-80 showing positive income. The Income-tax Officer while giving effect to the appellate order assessed the income at Rs. 13,71,369 as against the income returned by the assessee on June 30, 1980, in the sum of Rs. 10,29,090. The Income-tax Officer while assessing the respondent-assessee passed the following order: "Charge interest under section 215 as statement of advance tax filed on April 6, 1979, has not been revised upward before the last date of payment of advance tax." The assessee made an application before the Income- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rated their respective submissions which were advanced before the Commissioner of Income-tax (Appeals). The Income-tax Appellate Tribunal, after hearing the parties, was pleased to rely on the Commissioner of Income-tax (Appeals) reasoning making it clear that the order directing cancellation of interest and reasons mentioned by the Commissioner of Income-tax (Appeals) in support of his order were quite valid. The Tribunal while holding the appeal maintainable was pleased to affirm the order of the Commissioner of Income-tax (Appeals), the first appellate authority. The Revenue sought reference with respect to two questions of law; one relating to maintainability of the appeal and the second relating to jurisdiction of the Tribunal holding that interest under section 217 was not leviable for failure to receive the statement of interest under section 209A(4). The question of law extracted in the opening part of this judgment came to be referred as substantial question of law; which in substance challenges the decision of the Income-tax Appellate Tribunal on the ground that the Tribunal has ignored the clear provisions of section 209A(1) to the effect that the statement of advance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first time coming within the mischief of the Act and not that person who had been once assessed under the Act. To counter this submission, learned counsel for the Revenue submits that while interpreting the words referred to hereinabove, it cannot be understood to exclude the assessee, who had filed his return of income for the previous assessment year but has not been assessed for that assessment year under the provisions of the Act. Learned counsel for the Revenue while elaborating the logic behind this submission, submitted that if a new or fresh assessee who has not been previously assessed by way of regular assessment under the Act is under an obligation to furnish estimate of his current income (if it exceeds the amount specified in sub-section (2) of section 208) and advance tax calculated by him on the current income in the manner laid down in section 209 and on the top of it if he is required to pay advance tax as contemplated under section 209A, then, as against this, how can the assessee, who has filed his return of income for the previous year but has not been assessed, be put to a more advantageous position than a fresh assessee who has never been assessed under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st case. According to Ms. Jagtiani, in the Bombay High Court decision in the case of Patel Aluminium P. Ltd. reported in [1987] 165 ITR 99 Justice Bharucha while analysing the scheme of section 209A at page 103 of the judgment has clearly laid down as follows: "The question really boils down to an interpretation of the words 'a statement of advance tax payable by him computed in the manner laid down in' section 209(1)(a). Under section 209A(1)(a), the obligation of an assessee who has been previously regularly assessed to tax is to compute the advance tax payable by him in the manner provided by section 209(1)(a), to send a statement of such computation to the Income-tax Officer and to pay the amount so computed. The statement that the assessee is obliged to send is a statement of the computation of the advance tax payable by him, such computation to be made as provided by section 209(1)(a). If upon such computation being made, no advance tax is found to be payable', there is no 'advance tax payable'. There being no 'advance tax payable, there is no obligation to send to the Income-tax Officer a statement of such computation." Based on the above observation of this court, Ms. Ja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 209A cannot be pressed into service. That apart, the question referred to us does not cover the point raised by Mr. Bagchi. We have already set out the question which only deals with the obligation of the assessee to furnish a statement in terms of section 209A(1)(a)." The above decision has been followed by the Calcutta High Court in Director of Income-tax (Exemption) v. Shree Sitaram Public Charitable Trust [1994] 207 ITR 1087 and also referred to the Bombay High Court decision in Patel Aluminium P. Ltd. [1987] 165 ITR 99. It was thus held by the Calcutta High Court in this decision that since the income in the last completed assessment under the latest income returned and assessed was nil, in such a case there was no liability to pay advance tax on the part of the assessee as on 15th June. Therefore, there was no obligation to file a statement of advance tax and thus interest under section 217 was not payable. It has been held that "section 209A(1) incorporated a twin requirement, namely, filing of statement and paying of advance tax in accordance with the statement". Ms. Jagtiani reverting back to the facts of this case submitted that at the time when the assessee is o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c) and (d) of section 209. Clause (c) provides for the case where the estimate or revised statement has been sent by the assessee either under section 209A or section 212 then the income so estimated be substituted for the total income referred to in clause (a). Clause (d) provides that if the assessee has paid tax by way of self-assessment under section 140A for a year later than the previous year referred to in clause (a) and such income exceeds the total income referred to in clause (a) then this is to be substituted for the income referred to in clause (a) or as provided under sub-clause (2) if the Income-tax Officer makes an amendment order under section 210. Section 209A: Section 209A provides that every person shall on or before the date when the first instalment is due send to the Income-tax Officer, if he is an assessee who has previously been assessed by way of regular assessment, a statement of advance tax payable by him which is to be computed in the manner laid down in clause (a), or, as the case may be, sub-clause (i) of clause (d) of sub-section (1) of section 209. Since the assessee has been previously assessed by way of regular assessment, there is no dispute that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section refers to an assessee who has received an order under section 210 and estimates that the tax due in his case would be less than the amount that he is required to pay under such an order, then he has the option to send an estimate and pay tax in accordance with that estimate and sub-section (2) gives him the option of a further estimate in such a case. Interest payable by assessee: 215 provides that if an assessee, who has paid advance tax under section 209A or section 212 on the basis of his own estimate and if the advance tax so paid falls short of the criteria specified therein, then interest has to be paid by the assessee. Interest payable by assessee in case of underestimate: 216: This applies where the assessee has underestimated the advance tax either under section 209A or section 212, then in such cases interest is payable as specified in this section. Interest payable by assessee when no estimate is made: 217(1): This interest is chargeable when the assessee being the person referred to in clause (a) of sub-section (1) of section 209A has not sent the statement referred to in that clause or the assessee referred to clause (b) has not sent the estimate, then in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... leted. Applying the aforesaid scheme of the Act to the facts of the case, it is seen that the assessment for the assessment year 1977-78 was completed after June 15, 1979, i.e., after the date on which the assessee was required to file the statement of his income under the provisions of section 209A. The income of the assessee was a positive income for the assessment year 1977-78. The first instalment was due on September 15, 1981. Therefore, the first terminus ascertained as per the provisions of section 209(1)(a)(i) of the Act was assessed at loss. In so far as the requirement of clause (d) of sub-section (1) of section 209 is concerned, it is an admitted position that, for all the subsequent years, the returned income was either "nil" or at a figure of loss. Thus, admittedly, in terms of section 209(1)(d) of the Act, the total income for the previous year on the basis of self-assessment the advance tax could have been ascertained. In this circumstance, the respondent-assessee was obliged to file statement of advance tax as required under section 209. The requirement of submitting a statement or estimate under the provisions of the Act is for the purpose of paying advance tax an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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