1985 (10) TMI 93

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..... ncome-tax passed under section 263 on the ground that when, on making the regular assessment, no tax liability was found due, there was no occasion for the Income-tax Officer to charge interest under section 216 of the Income-tax Act, 1961 ? " The Punjab Business and Supply Co. Pvt. Ltd., Yamunanagar (hereinafter called " the assessee "), was served with a notice dated April 11, 1972, under section, 210 of the Act by the Income-tax Officer requiring the assessee to pay advance tax of Rs. 2,03,863 on an income of Rs. 2,98,702 in 3 equal instalments on the stipulated dates in September, December and March of the financial year 1972-73. Apparently, the figures of the income and the amount of advance tax payable mentioned in the said notice we .....

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..... above, the assessee had paid advance tax totalling Rs. 1,58,770, the amount of advance tax paid over and above Rs. 85,233 was determined as refundable to the assessee. The Commissioner of Income-tax was of the view that the assessee having filed the revised estimate on March 11, 1973, wherein the amount of Rs. 1,58,770 was mentioned as the advance tax payable on an estimated income of Rs. 2,77,000, the assessee had deliberately underestimated the advance tax payable by it in the first two instalments and as such the provisions of sub-clause (a) of section 216 of the Act became applicable. Not charging interest on the assessee as contemplated by section 216(b)(i) by the Income-tax Officer at the time of making the regular assessment was tr .....

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..... y misconceived. The opening words of section 216 of the Act leave no manner of doubt that for determination of the question whether or not the assessee had paid reduced amount of advance tax, the amount of income-tax determined as payable on making " regular assessment " is to be taken into consideration to find out whether the advance tax paid by the assessee was underestimated within the meaning of sub-clause (a) of this section. The revised estimate submitted by the assessee on March I 1, 1973, is not the relevant factor to be taken into consideration for this purpose. Consequently the question is answered in the affirmative, i.e., in favour of the assessee and against the Revenue. There shall be no order as to costs.
Case laws, Dec .....

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