Ayush Ajay Construction Ltd. vs Income-Tax Officer on 20 July, 2000
20. Apropos ground No. 5 it has been conceded on behalf of the assessee that the revenue cannot charge interest under section 234B without passing a specified order in this regard in the assessment order. In support of his contention he relied upon the judgment of Patna High Court in the case of Uday Mistanna Bhandar & Complex v. C/r[1996] 222 ITR 44 in which their Lordships have held that notice of demand under sections 234A and 234B claiming interest can only be issued when there is a specific order in the assessment order levying interest under that section. To use the expression "charge interest, if any," or "charge interest as per the rules" cannot be read to mean that the Assessing Officer has passed orders to charge interest under all the aforesaid sections. The order to charge interest is to be specific and clear as for that matter any order to charge any tax, penalty or fine. When the assessment order is silent whether any interest is leviable, notice of demand under section 156 of the Act cannot go beyond the assessment order and the assessee cannot be served with any such notice demanding interest. Mr. Agrawal has also relied upon the order of Delhi Bench 'D' of the Tribunal in the case of Multies Chemicals v. Asstt. CIT IT Appeal No. 801 (Delhi) of 1992 in which the view of the Patna High Court was followed by the Tribunal. It was further contended that since no contrary view has been taken by any other High Court of the land, the view taken by the Patna High Court should strictly be followed by all the Benches of the Tribunal though they do not fall within the
jurisdiction of the Patna High Court. In the assessment order the Assessing Officer has simply stated "charge interest as per law" which does not enjoin the revenue to issue as demand notice of interest under section 234B of the Act.