TMI Blog1984 (10) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... x demand under section 210 of the Income-tax Act, 1961 (hereinafter referred to as "the Act "), in a sum of Rs. 49,722 in August, 1969, based on the then latest completed assessment for the year 1964-65 which showed a total income of Rs. 2,13,750. The assessee, without complying with the said demand, sent an estimate under section 212(1) on September 6, 1969, estimating its total income at Rs. 1,16,000 and the tax thereon at Rs. 14,916. Thereafter, the assessee filed a return of income for the year 1970-71 showing an income of Rs. 2,67,935. However, the assessment was completed on a total income of Rs. 5,87,200 resulting in a tax demand of Rs. 1,39,577. The Income-tax Officer thereafter initiated penalty proceedings for the assessee's failu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rieved by the decision of the Tribunal, the assessee has sought and obtained a reference to this court on the question referred to above. From the facts stated above, it will be clear that the only point that is to be considered by us in this case is whether, on the facts and circumstances of this case, there is an obligation on the part of the assessee to make an estimate under section 212(3A). The scheme of advance tax is as follows., In the case of the assessees who are regularly assessed, the Income-tax Officer raises a demand on the basis of the latest completed assessment under section 210. The tax on the current income is to be collected in advance and the current income is estimated by the Income-tax Officer on the basis of the la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he language of the said section, we are not inclined to accept the contention of the assessee that once an estimate is filed under section 212(1), there is no obligation to make any estimate under section 212(3A). We find that section 212(3A) extracted above requires the assessee on whom a notice has been issued under section 210 to make an upward revision of the tax if the current income exceeds the advance tax demanded by 33 1/3 per cent. There is nothing in section 212(3A) to indicate that this should be exercised only as soon as the receipt of demand under section 210 and not on any later occasion. It is no doubt true, the assessee may, on receiving a demand for advance tax, reduce the demand by referring to his current income under sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 212(3A) and the assessee not having filed the estimate as required by him, the penalty levied cannot be held to be unjustified. The learned counsel for the assessee, however, refers to the decision of the Bombay High Court in Hind Products (P) Ltd. v. CIT [1980] 121 ITR 903, in support of his plea that once having given an estimate under section 212(1), the assessee is not under an obligation to submit an estimate under section 212(3A). But we do not see how that decision will apply to the facts of this case. There, the assessee filed an estimate of losses. However, profits accrued subsequently when the Income-tax Officer held that the estimate filed by the assessee was mala fide and unreal and, therefore, penalty was called for. When th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the current income exceeded the amount of advance tax demanded from the assessee under section 210 by more than 33 That condition is satisfied here and the mere fact that the assessee has earlier filed an estimate under section 212(1) showing a lesser income than what was estimated by the Income-tax Officer will not absolve him from filing an estimate under section 212(3A) if his income has exceeded the estimated income by 33 1/3%. The decision of the Calcutta High Court in Ramnagar Cane Sugar Co. Ltd. v. CIT [1982] 134 ITR 609 may not apply to the facts of this case for, in that case, the court found that the assessee had no idea as to his actual profits at the time when it paid advance tax on the basis of the profit earned in the im ..... X X X X Extracts X X X X X X X X Extracts X X X X
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