TMI Blog1999 (5) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... in the computation of the assessee's business income for the assessment year 1984-85 ? Whether, on facts and in the circumstances of the case, the Tribunal was justified in upholding the order of the Commissioner of Income-tax (Appeals) to the effect that provision in respect of liability towards interest amounting to Rs. 41,666 payable to the Government of Haryana on arrears of purchase tax for the assessment year 1984-85 is not hit by the provisions of section 43B of the Act, 1961 ?" The assessee is a company carrying on business in the purchase and sale of cotton and cotton seeds. It also derives income from interest, dividend and capital gains. The assessment year is 1984-85 and previous year ending is on March 31, 1984. While comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 40A(3) of the Act. Mr. Khaitan further brought to our notice that the Tribunal has not considered the letter given by the Marketing Committee to the effect that the Committee was not prepared to accept the payment by cheque. The assessee moved the application before the Tribunal. That certificate issued by the Committee has been considered by the Tribunal in the miscellaneous application and found that the certificate issued by the Marketing Committee is an afterthought. In view of this finding of the fact, no interference is called for in the order of the Tribunal. The question proposed by the Revenue pertaining to interest amounting to Rs. 41,666 payable to the Government of Haryana whether that claim is hit by the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Haryana General Sales Tax Act, 1973, interest can be treated as tax. While reading the provisions of sub-section (2) of section 59 of the Act, we cannot construe that interest which is treated for the limited purpose as a tax. The interest under that sub-section is treated as tax that is deemed as tax, only for the purpose of collection and recovery of the tax. That is a deeming provision, Here the interest which has been treated as deemed tax, by no stretch of imagination can be said to be a tax under the Income-tax Act. But it is very common in legislation to give a specific meaning to a particular word to achieve the object of the Act, in spite of the fact that meaning is not known in the common parlance. Shri Ramchandra, learned cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : "Where on completion of the regular assessment the amount on which interest was paid under sub-section (1) has been reduced, the interest shall be reduced accordingly and the excess, if any, paid 'Shall be deemed to be tax payable by the assessee and the provisions of this Act shall apply accordingly." After quoting part of that order, the Karnataka High Court has taken the view as under : "We are of the view that these principles are apposite in construing the true scope and ambit of section 214(1A) of the Act. When we apply these principles, it is clear that the excess interest paid to the assessee earlier and later repayable by him is not really tax levied under the Act on income but is treated as tax for purposes of the Act. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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