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TMI Blog2000 (10) TMI 24X X X X Extracts X X X X X X X X Extracts X X X X ..... timate in Form No. 29 on June 15, September 15, and December 15, 1984, and also paid advance tax accordingly. According to the averments contained in the affidavit filed in support of the writ petition, the petitioner has stated that later the petitioner filed a revised return disclosing a sum of Rs. 215.58 lakhs on February 18, 1988, after taking into account the customs duty element of closing stock of raw materials at the factory and revised computation for tax holiday benefit under section 80-I of the Income-tax Act, 1961, on the basis of the directions given by the Commissioner of Income-tax (Appeals) in ITA No. 466 of 1986-87, dated April 13, 1987, for the assessment year 1983-84. The case of the petitioner is that the petitioner filed the revised return voluntarily. According to the petitioner, when the petitioner paid Rs. 97.50 lakhs as advance tax and filed the advance estimate, the petitioner could not have anticipated the directions given by the Commissioner of Income-tax (Appeals) for the assessment year 1983-84 and hence the shortfall in the payment of advance tax arose. The Income-tax Officer determined the total income at Rs. 2,26,80,760 and also levied interest und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advance tax is not justified. It was also submitted that the levy of interest would seriously affect the financial position of the petitioner-company and the petitioner has not committed any wilful default and the petitioner has co-operated with the Department in the completion of the assessment. The Commissioner of Income-tax rejected the petition filed by the petitioner under section 264 of the Income-tax Act on the ground that the question of levy of interest arose only when there is variation between the estimated income and the assessed income and the genuineness of the claim is relevant only for the purpose of levy of penalty and not for the purpose of levy of interest. The other ground pointed out by the Commissioner was that the petitioner did not file any revised return but filed only the revised statement of income and the petitioner did not pay tax under section 140A of the Income-tax Act. Therefore, the Commissioner held that the Assessing Officer has properly exercised jurisdiction in levying interest. The Commissioner ultimately held that the petitioner is not entitled to any further waiver of interest. The petitioner is challenging the order of the Commissioner of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y ignoring the customs duty paid on such material. Learned senior standing counsel also referred to the order of the Commissioner of Income-tax wherein he has reiterated that the assessee would have anticipated the additions regarding customs duty and the relief under section 80-I of the Income-tax Act. Learned senior standing counsel also referred to the order of the Commissioner of Income-tax and submitted that the Commissioner has found that the Assessing Officer has already exercised the power vested with him and reduced the interest to Rs. 8.40 lakhs against the original levy of interest of Rs. 19.85 lakhs and submitted that the facts of the case make it clear that the levy of interest is justified and there are no grounds to interfere. Before considering the question whether the Commissioner has properly exercised the power under section 264 of the Income-tax Act, it is necessary to mention the decision of this court in Salem Co-operative Sugar Mills Ltd. v. CIT [1999] 240 ITR 910 wherein this court held that the levy of interest is a part of the process of assessment and the assessing authority is not compelled to give a show-cause notice before levying interest and no prio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 215 of the Income tax Act should be waived or not under rule 40 of the Income-tax Rules. In my view, the view of the Commissioner that voluntary act of the assessee would be relevant for the purpose of waiver of penalty and not for the purpose of waiver of interest is not relevant. I am of the view that if the view of the Commissioner that the levy of interest is automatic, and the question whether the assessee has filed the estimate voluntarily or not is accepted, then, there can be no waiver of interest at all in any case of levy of interest. Hence, the first reason given by the Commissioner that the levy of interest is automatic is not relevant for the purpose of considering the application filed under rule 40 of the Income-tax Rules. The second reason given was that the petitioner has not filed any revised return, but only filed the revised statement of income and, hence, the petitioner is not entitled to waiver of interest. In my view, the second reason given by the Commissioner is also not relevant. Let me assume that the petitioner filed the revised return of income and in that case, it would be required to pay the tax under section 140A of the Income-tax Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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