TMI Blog1983 (9) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... 68 ought to have been filed on or before September 30, 1967. It was actually filed on March. 16, 1969. No application for extension of time therefor had been submitted. The ITO completed the assessment on August 14, 1969. In this order, he made no mention regarding interest to be paid by the assessee under s. 139. Upon a perusal of the assessment records of the assessee, the Addl. CIT noted that the action of the ITO in not levying statutory interest under s. 139(1)(iii) of the Act while passing the assessment order was erroneous in so far as it was prejudicial to the interests of the Revenue within the meaning of that expression under s. 263. He, therefore, directed the ITO to levy interest as aforesaid. Aggrieved by the Additional Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l for and examine the record of any proceeding under this Act, if he considers that any order passed therein by the ITO is erroneous in so far as it is prejudicial to the interests of the Revenue. Mr. Joshi, learned counsel for the Revenue, referred to a Division Bench judgment of the Allahabad High Court in Addl. CIT v. Saraya Distillery [1978] 115 ITR 34. In that case, the amounts of advance tax estimated and paid by the assessee were less than 75 per cent. of the tax determined on completion of the regular assessment. As such, interest was payable by the assessee under s. 215 of the Act upon the amount by which the advance tax fell short of the assessed tax. The ITO omitted to include interest in the notices of demand for tax. The Addl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the Calcutta High Court that where the statute gave an authority jurisdiction to exercise discretion on certain objective factors, the exercise of such discretion has to be manifest, so that it can be gathered whether the discretion had been properly exercised or not. The question was not of the validity of the exercise of the discretion by the ITO but of non-application of law to the facts of the case. If the interest that was liable to be charged had not been charged, then the order of the ITO was certainly prejudicial to the interests of the Revenue and as such the Commissioner could exercise his jurisdiction under s. 263. We are entirely in agreement with the reasoning of the learned single judge of the Calcutta High Court. The I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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