TMI Blog2021 (12) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... original amount on which interest is levied under Section 220 ceases, accordingly, the Assessee needs to be given the benefit of reduction in interest resulting in reduced payment of interest. In the facts of the present case, CIT(A)(VI), Bombay, by order dated 30/03/1995, directed the Assessing Officer to withdraw the investment allowance granted under Section 32A of the Act. Accordingly, demand notice under Section 156 of the Act came to be issued to Respondent No.1. The said amount of interest on investment allowance under Section 32A was directed to be waived by order dated 05/06/1998 by the Settlement Commission. Petitioners therefore filed an application for recalling the order dated 05/06/1998, which by the impugned order was reje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SHRIRAM AMIT B. BORKAR , JJ . Mr. Sham V. Walve a/w Mr. Dinesh Kukreja Mr. Pritish Chatterjee for Petitioners. Ms. Shobha H. Jagtiani a/w Mr. Priyanshu Khatri Ms. Anjali Jhawar i/b D M Harish Co. for Respondent No.1. ORAL JUDGMENT : (PER : AMIT B. BORKAR. J.) :- 1. By the present Petition, Petitioners challenge orders dated 05/06/1998 and 04/08/1999 passed by Respondent No.2 purporting to reduce the interest levied under Section 220(2) of the Income Tax Act, 1961 (hereinafter referred to as the Act ). 2. The assessment year relevant for the purpose of Appeal is A.Y. 1989-90. 3. The return of income was filed by Respondent No. 1 in respect of the aforesaid assessment year on 11/10/1990, declaring a total i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayment, the interest under Section 220(2) became payable w.e.f. 01/05/1992 to 31/03/1996 on demand payable on the finally determined income by the Income Tax Settlement Commission under Section 245D(4) at ₹ 4,79,26,970/-. 8. By Miscellaneous Application dated 21/01/1998, Respondent No.1 sought the rectification of the order passed by Respondent No.2 under Section 245D(4) of the Act, inter-alia, on the ground that since the said order was silent on the point of charging interest under Section 220(2), it should be considered to have been waived. 9. By order dated 05/06/1998, Respondent No.2 inter-alia held that it did not consider it to be a good case for waiver of interest chargeable under Section 220(2). However, regarding the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition, Income Tax Appellate Tribunal, Mumbai (hereinafter referred to as 'ITAT') had allowed Appeal filed by Respondent No.1 setting aside the order passed by CIT(A) directing withdrawal of investment allowance granted under Section 32A of the Act. She submitted that liability to pay the amount on which interest was payable under Section 220(2) had been extinguished with the result. Therefore, as per proviso to Section 220(2), the interest payable is required to be reduced accordingly. 16. We have considered the submissions and the documents on record, including Judgment of ITAT dated 18/07/2002 in ITA No.5416/BOM/95 to ITA No.5419/BOM/95. 17. For determination of the issue involved, it is necessary to consider Section 220(2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the first proviso to sub-Section (2) to Section 220 will be that the amount on which the interest is payable under sub-Section (2) of Section 220 will get modified according to the Appellate order. As seen from the proviso to sub-Section (2) of Section 220, there can be variation in charging interest if ultimately due to the result of Appellate order, the liability to pay the original amount on which interest is levied under Section 220 ceases, accordingly, the Assessee needs to be given the benefit of reduction in interest resulting in reduced payment of interest. 19. In the facts of the present case, CIT(A)(VI), Bombay, by order dated 30/03/1995, directed the Assessing Officer to withdraw the investment allowance granted under Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ir Lordships, in paragraph 43, observed as under : 43. Issuance of a Writ of Certiorari is a discretionary remedy (See Champalal Binani v. CIT ). The High Court and consequently this Court while exercising their extra-ordinary jurisdiction under Article 226 or 32 of the Constitution of India may not strike down an illegal order although it would be lawful to do so. In a given case, the High Court or this Court may refuse to extend the benefit of a discretionary relief to the applicant. Furthermore this court exercised its discretionary jurisdiction under Article 136 of the Constitution of India which need not be exercised in a case where the impugned judgment is found to be erroneous if by reason thereof substantial justice is being d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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