TMI Blog1987 (12) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... income-tax, did not file returns for the above two years, though he was served with notices under section 148 of the Income-tax Act. The assessments were made under section 144 of the Act. Interest under section 139(8) of the Act was levied for both the years as per exhibits P-1 and P-2 assessment orders. A challenge against the levy of interest under section 139(8)(a) of the Act made before the Commissioner of Income-tax was not successful. The Commissioner of Income-tax dismissed the revisions filed by the assessee as per exhibit P-6 order dated May 24, 1979. In the original petition the appellant challenged exhibit P-4 order refusing to waive the interest levied as also exhibit P-6 order passed in revision. The learned single judge dism ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid, and any tax deducted at source : Provided that the Income-tax Officer may, in such cases and under such circumstances as may be prescribed, reduce or waive the interest payable by any assessee under this sub-section. " 117A. Reduction or waiver of interest payable under section 139. The Income-tax Officer may reduce or waive the interest payable under section 139 in the cases and in the circumstances mentioned below, namely : (i) where the return of income is furnished by a person who has been treated under section 163 as an agent of a non-resident and is assessed in respect of the latter's income ; (ii) where the return of income is furnished by an assessee whose only source of income during the relevant previous year is a shar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tice on the assessee, even before the levy of interest under section 139(8)(a) of the Act, does not prima facie appear to be justified. Construing section 139(8)(a) along with proviso with rule II 7A of the Incometax Rules, we are of the view that though it may be to open the Incometax Officer to intimate the assessee even before the " levy " is made, it is open to the assessee even after the " levy " is made, to invoke the jurisdiction of the Income-tax Officer under the proviso to section 139(8)(a) of the Act, read with rule II 7A, to waive or reduce the interest " Payable ". It cannot be stated that in the absence of a notice and hearing, the levy itself cannot be made under section 139(8)(a) of the Act. Appellant's counsel laid stress ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , it is open to the assessee to move the Income-tax Officer, praying for the relief under the proviso to section 139(8)(a) read with rule 117A of the Rules to waive or reduce the interest " payable ". But it cannot be said that before levy of the interest under section 139(8)(a) of the Act, there is a mandatory duty cast on the Income-tax Officer to serve a notice on the assessee and afford him an opportunity against the levy itself. The recent decision of the Supreme Court in Central Provinces Manganese Ore Co. Ltd. v. CIT [1986] 160 ITR 961, concludes the matter against the appellant. The Supreme Court took the view that interest is levied under section 139(8)(a) of the Act by way of " compensation " and it is " part of the process of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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