Income Tax Appellate Tribunal - Chandigarh
Karanvir Singh Gossal , Chandigarh vs Department Of Income Tax on 12 August, 2013
IN THE INCOME TAX APPELLATE TRIBUNAL
CHANDIGARH BENCHES 'B'CHANDIGARH
BEFORE SHR I T.R.SOOD, ACCOUNTANT MEMBER
AND MS SUSHMA CHOW LA, JUDIC IAL MEMBER
ITA No. 383/Chd/2002
Assessment Year:1996-97
The Income Tax Officer, Vs Shri Karanvir Singh Gossal,
Ward 5(4), Prop. M/s Gosson Air Conditioning,
Chandi garh. F-19, I.A. Phase V III,
Mohali.
PAN No. --------------
(Appellant) (Respondent)
Appellant by : Shri Amarveer Singh
Respondent by : None
Date of Hearing : 12.08.2013
Date of Pronouncement : 23.08.2013
O R D E R
PER SUSHMA CHOWLA, JM
The present appeal was set aside pursuant to the order of the Hon'ble Supreme Court of India in Civil Appeal No. 1937 of 2007 relating to assessment year 1996-97.
2. The onl y issue raised in the present appeal is against charging of interest under section 234A and 234B of the Income-tax Act, 1961 (in short 'the Act') totaling Rs. 653,663/-. The Tribunal vide order dated 31.03.2005 had upheld the charging of interest under section 234A and 234B of the Act at Rs. 653,663/-. The Hon'ble Punjab & Haryana High Court in IT Appeal No. 502 of 2005 vide judgement dated 20.02.2006 had dismissed the appeal of the assessee in respect of the charging of the said interest and had dismissed the appeal of the assessee holding no substantial 2 question of law survives in view of the decision of the Hon'ble High Court in Vinod Khurana Vs CIT 253 ITR 578 (P&H).
3. The Hon'ble Supreme Court in Civil Appeal NO. 1937 of 2007 vide judgement dated 06.09.2012, in an appeal filed by the assessee had held that prior to the decision of five judge Bench of Hon'ble Supreme Court in the case of CIT Vs Anjum M.H. Ghaswala & Ors. 252 ITR 1 (S.C) holding that charging of interest under section 234B and 234C of the Act were mandatory in nature though earlier there were conflicting opinion amongst various High Courts in India. The Hon'ble Supreme Court in assessee's case held that, "Be that as it may, the position that emerges after the judgment of this Court in Anjum Ghaswala's case [supra] is that if interest is leviable in a given case under Section 234B/234C, then in such a case that levy is mandatory and compensatory in nature." It was further observed by the Hon'ble Supreme Court that the Chief Commissioner has an authorit y to waive the interest levied under section 234A, 234B and 234C of the Act in view of the circular issued by the Board in F.No. 400/234/95- IT(B), dated May 23, 1996. In view thereof, the issue was set aside to the Tribunal with a direction to consider whether the assessee would be entitled to waiver of interest under the said circular dated 23.05.1996.
4. In view of the directions of the Hon'ble Supreme Court, the present issues have been slated for hearing before us. The appeal of the assessee was fixed from date to date and the notice of hearing was sent to the assessee through registered A.D. The last notice of hearing dated 27.05.2013 was issued and sent to the assessee vide Regd.A.D. and date of hearing was fixed for 12.08.2013. However, the assessee failed to appear before the Tribunal on the appointed date of hearing nor any application was moved for adjournment. In view of the issue raised in the present appeal, we proceed to decide the same after hearing the ld. DR for the 3 revenue who in turn placing reliance on the circular issued by the Board dated 23.05.1996 pointed out that the assessee has to fulfill certain conditions consequent to which, the Chief Commissioner of the Income-tax may order waiver or reduction of interest under section 234A, 234B and 234C of the Act.
5. On the perusal of record and the relevant circular issued by the Board, we find that the issue raised in the present appeal is in relation to charging of interest under section 234B and 234C of the Act aggregating Rs. 653,663/-. The Assessing Officer passed the assessment order in the case of the assessee under section 143(3) of the Act. However, there was no specific mention of charging of interest under section 234B and 234C of the Act. On the other hand, in form No. ITNS 150 dated 28.03.2001, the assessing authorit y had clearl y mentioned the details of interest charged under section 234B and 234C of the Act which was passed on the same day while passing the assessment order on 28.03.2001. The Tribunal, in turn rel ying on the ratio laid down by the jurisdictional High Court in Vinod Khurana Vs CIT (supra) had upheld the charging of interest under section 234B and 234C of the Act was mandatory. The said order of the Tribunal was confirmed by the Hon'ble Punjab & Haryana High Court (supra). The Hon'ble Supreme Court, in view of the ratio laid down by the five judge Bench of the Apex Court in C IT Vs Anjum M.H. Ghaswala & Ors. (supra) had also held that charging of interest under section 234B and 234C of the Act was mandatory and compensatory in nature. However, the said interest charged under section 234B and 234C of the Act can be waived or reduced by the Chief Commissioner of Income-tax in view of the circular dated 23.05.1996 issued by the Board. The said circular enlists the conditions under which the said reduction or waiver of interest under section 234A, 234B or 234C of the Act can be considered. Perusal of the copy of the 4 said circular reflects that the Chief Commissioner of Income-tax is empowered to reduce or waive such interest as levied under section 234A, 234B or 234C of the Act in view of the circular issued by the Board dated 23.05.1996, subject to fulfillment of the conditions enlisted under para 2 of the said circular. The assessee has failed to appear on the appointed date of hearing nor any application has been moved in respect of the conditions laid down in the said circular dated 23.05.1996. In view thereof, we uphold the levy of interest under section 234B & 234C of the Act in the facts and circumstances of the present case, in-turn following the ratio laid down by the Hon'ble Apex Court in assessee's own case that charging of interest under section 234B or 234C of the Act is mandatory and compensatory in nature. However, the assessee is at liberty to approach the concerned Chief Commissioner of Income-tax for waiver or reduction of interest levied under section 234B and 234C of the Act in line with the circular issued by the Board dated 23.05.1996 in case the conditions enlisted therein are fulfilled. The ground of appeal raised by Revenue are, thus allowed.
6. In view thereof, the appeal filed by the revenue is allowed.
Order Pronounced in the Open Court on this 23 r d day of August, 2013.
Sd/- Sd/-
(T.R.SOOD) (SUSHMA CHOWLA)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated 23 r d Aug,2013
Poonam
Copy to:
1. The Appellant
2. The Respondent
3. The CIT
4. The CIT(A)
5. The DR
By Order
Assistant Registrar, ITAT,
Chandigarh