TMI Blog1991 (4) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... rds, it is noticed that in computing the tax, interest chargeable under s. 139(8) had to be charged, although a direction was given in the assessment order. As this was a mistake apparent from record, he rectified in under s. 154 of the Act and levied interest under s. 139(8). 3. The assessee went in appeal and submitted that no interest was leviable under s. 139(8) in this case because on the basis of the regular assessment refund of Rs. 4,056 was due to them. It was the case of the assessee before the CIT(A) that where no tax by the firm is payable, compensatory interest under s. 139(8) is not chargeable at all. The assessee relied on two decisions of Gauhati High Court; one reported in CIT vs. Maskara Tea Estate (1981) 21 CTR (Gau) 47 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the instant case where after giving credit for advance tax and TDS the appellant was entitled to refund. The whole purpose behind s. 139(8) is to see that the returns are filed in time and in case they are so filed, the assessee has to pay interest on the tax due. One important condition to be satisfied is that there should be tax payable on the total income as determined on regular assessment, after taking into account advance tax and tax deducted at source. The fact that the assessee is a registered firm will not make any difference so far as satisfaction to this condition is concerned. Further, the provision has been made for the purpose of compensating the Government for with holding the tax by the assessee, which in due at a particular ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O (1987) 66 CTR (SC) 135 : (1988) 169 ITR 221 (SC). The learned counsel, particularly relied on the observation of the Court at page 230 which are as follows: "Before we part with these appeals, we think we should clarify one situation, namely, where the advance tax duly paid covers the entire amount of tax assessed, there is no question of charging the registered firm with interest even though the return is filed by it beyond the time allowed, regard being had to the fact that payment of interest is only compensatory in nature. As the entire amount of tax is paid by way of advance tax, the question of payment of any compensation does not arise." 7. We have considered the submissions made on both the sides and have carefully gone thro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction, where the assessee is a registered firm or an unregistered firm which has been assessed under cl. (b) of s. 183, the tax payable on the total income shall be the amount of tax which would have been payable if the firm had been assessed as an unregistered firm." The language of the Explanation is clear and unambiguous. This Explanation clearly provides that where the assessee is a registered firm or unregistered firm under s. 183(b), the tax payable for this sub-s. (i.e. 139(8)) on the total income shall be the amount of tax which would have been payable if the firm had been assessed as an unregistered firm. The tax payable for the purposes of calculation of simple interest has to be determined on the basis that the registered firm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee's representative in Ganesh Dass Sreeram's case is concerned, we find that the Supreme Court was interpreting the provisions of s. 139(8) as they stood prior to 1st April, 1971 as they were dealing with the case relating to the asst. yr. 1968-69. Here, we are concerned with the provisions of s. 139(8) as they stood after 1st April, 1972 when Expln. 2 was added by the Finance Act, 1972 which Explanation remained on the Statue Book till it was replaced by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1st April, 1985. This Explanation could not have come for interpretation by the Supreme Court in the case decided by them for an earlier year. We are, therefore, of the view that the reliance of the assessee on the decision of the Su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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