TMI Blog1988 (9) TMI 86X X X X Extracts X X X X X X X X Extracts X X X X ..... 86 and 27th March, 1986, the assessee had filed a revised return of its total income on 17th March, 1986 declaring the total income of the assessee firm at Rs. 4,58,200 while the income assessed by the ITO in the order is at Rs. 4,53,590. According to the assessee, the revised return filed on 17th March, 1986 was under the Amnesty Scheme, 1986 with a view to claim the benefits of non-levy of penalties and various interests under ss. 139(8), 215/217/(1A) but the ITO did not take into consideration this return in order to deprive the assessee of the benefits conferred by the Amnesty Scheme. The main submission thus was that the order passed by the ITO dt. 13th March, 1986 is antidated in order to deprive the assessee of the benefits of the Scheme. The various grounds of appeal by the assessee have, therefore, to be considered against this background. Originally the assessee raised the following grounds before the CIT(A): "1. That the learned ITO has erred in law and on facts by completing the assessment as unregistered firm instead of registered firm as claimed by the assessee in its return of income. 2. That the learned ITO has erred in law and on facts by charging interest un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 412 (Cal) and Addl. CIT vs. Gurjargravures (P) Ltd. (1978) CTR (SC) 1 : (1978) 111 ITR 1 (SC). Ground No. 3 : The third ground of appeal is regarding the date of passing of assessment order; from a perusal of the record it seems that the order was passed by the ITO on 13th March, 1986 but was entered in the Demand Collection Register on 27th March, 1986 when the other documents like demand notice, penalty notice, etc., were prepared. Ground No. 4 : The assessee has objected to the initiation of penalties under s. 271(1)(c), 271(1)(a) and 273(2)(c), etc. My submission is that no appeal lies against the initiation of penalties and the matter whether the assessee's case is covered by the Amnesty Scheme or not is not within the appellate jurisdiction of the Courts. The assessee is already before the CIT(A), Ludhiana, in this regard." After reproducing the above reply by the ITO, the CIT(A) observed that as no appeal lay against the assessment order in view of the reasons given in grounds Nos. 2, 3 and 4 above (original) no additional ground could be entertained. He further observed that even on merits, he did not entertain the additional grounds because it involved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e grounds that he is not liable to the levy at all." The learned counsel for the assessee submitted that in the original grounds Nos. 2,3 and 4 the assessee had denied is liability to the levy of interest at all and, therefore, the appeal was maintainable. He further submitted that additional grounds Nos. 3 and 4 were in amplification of the grounds Nos. 2, 3, and 4 originally taken and, therefore, these grounds have wrongly not been admitted by the CIT(A). According to him, no additional evidence or investigation was called for. The documents referred to therein formed part of the assessment records. According to him whether the order of assessment was passed on 13th March, 1986 or thereafter could be seen by looking into the assessment order and assessment records themselves. He further submitted that the revised return of income filed by the assessee on 17th March, f1986 was submitted under the Amnesty Scheme and this was also part of the assessment record. The only thing the CIT(A) was to do was to look into the record whether such a return was there or not. Nothing new was brought before him. He further submitted that, in fact, the CIT(A) himself has considered the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT (1978) CTR (Guj) 172 : (1978) 114 ITR 197 (Guj); Rajyam Pictures vs. Addl. CIT (1978) CTR (Mad) 319: (1978) 114 ITR 847 (Mad); CIT vs. Gannon Dunkerley Co. (1979) 13 CTR (Bom) 104 : (1979) 119 ITR 595 (Bom); CIT vs. Raghubir Singh and Sons (1980) 18 CTR (P H) 107: (1980) 125 ITR 256 (P H) and, lastly, (1986) 160 ITR 961 (SC). He further stated that the assessee had made an application for waiver of interest under the Amnesty Scheme to the CIT (Central), Ludhiana which fact established that the assessee was not denying its liability to be charged to interest but was seeking waiver or reduction of interest and, therefore, no appeal was maintainable before the CIT(A) on this point and the CIT(A) has rightly dismissed the assessee's appeal. He further submitted that the assessment order passed by the ITO is dt. 13th March, 1986/17th March, 1986 and there was not anti-dating of the order as alleged by the learned Counsel for the assessee. On the point of refusal of registration, he supported the order of the CIT(A). 8. The learned counsel for the assessee in reply stated that it was wrong to suggest that the order was passed on 13th March, 1986, in as much as, in the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ancial year in which such tax was payable upto the date of regular assessment. Under sub-s. (1A) of s. 217, such interest is chargeable on the tax assessed as referred on in s. 217(1)(a) and as reduced by the advance-tax paid by the assessee from the first day of April next following the financial year to the date of regular assessment. Thus the period of default for which interest is to be charged either under s. 217(1)(a) or s. 217(1A) runs concurrently. The interest to be charged under s. 217(1)(a) is greater than interest charged under s.217(1A). Both the interest, therefore, cannot be charged for the same period of default. As a matter of fact, the learned Counsel for the assessee had referred to the circular of CBDT No. 951-CBDT-F No. 400/30/75 ITCC dt. 28th April, 1976 whereby it was directed by the Board as under: "Interest of like amount under s. 217(1A) of IT Act, 1961 should not be charged simultaneously for the same assessment year where interest under s. 215 has also been charged on the estimate filed by the assessee. The two provisions are distinct and separate and there cannot be cumulation under both." He urged that this principle equally holds good for levy o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment has also been approved by the Hon'ble Supreme Court in 160 ITR 961. In view of these authorities and the judgment of the Hon'ble Supreme Court we are inclined to hold that the appeal is maintainable against the levy of interest simpliciter without challenging the quantum of tax. 12. Under the Amnesty Scheme, 1986, clarifications for which have been given by circular No. 451 dt. 17th Feb., 1986, reported in (1986) 158 ITR 135 (St.), question No. 5 has been answered stating that since the ITO have been instructed not to initiate penalty proceedings and be liberal in waiver of interest in such cases, question of waiver by the CIT's does not arise. In other words, in respect of persons availing of the benefit of Amnesty Scheme, no penalty proceedings shall be initiated by the ITO nor interest will be charged. The learned Counsel for the assessee had also referred to question No. 1(b) where it was asked as to what will be the procedure required to be followed by the assessee who wants to declare income of the past years under the Amnesty Scheme in cases where the assessment in respect of those years were pending? The answer was that the tax payer should file revised return befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im and restore the issue to the file of the ITO with the direction that he should make assessment afresh taking into consideration the revised return filed by the assessee on 17th March, 1986, so however the income to be assessed does not exceed than shown in the revised return as the same is more than the assessed income. The ITO shall also adjudicate upon the additional grounds in relation to the claim of depreciation on plant and machinery at 15 per cent also additional depreciation on new plant and machinery admissible under s. 32(1)(iv). We also direct that since the case of the assessee is covered by the Amnesty Scheme by filing revised return, in view of the clarification given in question No. 1 relied on by the learned Counsel for the assessee, no proceedings for levy of penalties shall be initiated nor interest under various sections of the Act shall be charged particularly when income shown in the revised return is more than the assessed income. 13. Another issued to be considered is whether, where the assessee has made an application for waiver of interest, he should be denied the right of appeal. In our considered opinion, the mere application for waiver of interest ..... X X X X Extracts X X X X X X X X Extracts X X X X
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