Commissioner of Income Tax vs Bombay Burmah Trading Corporation Ltd.

T.D. Sugla, J.—In this departmental reference relating to the assessee''s assessment for the asst. yr. 1971-72, the ITAT has referred to this Court the following three questions of law under s. 256(1) of the IT Act, 1961 :

"(1) Whether, on the facts and in the circumstances of the case the Tribunal was right in holding in law that an appeal against an order refusing interest under s. 214 in its proper context is an appeal against an order of assessment referred to in s. 246(c) of the IT Act, 1961 ?"

(2) Without prejudice to the above, whether the Tribunal was right in holding in law that the order under s. 143(3) was an incomplete assessment order and the same was completed under s. 154 on 18th September, 1973 ?"

(3) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding in law that for the purpose of calculating interest under s. 214, the excess amount of advance tax paid should be ascertained with reference to the assessed income as per order dt. 18th September, 1973 ?"

So far as the first question of law is concerned, we find, and the counsel are agreed, that the question of law as framed does not really arise out of the order of the Tribunal. It is seen that interest was not paid to the assessee by the ITO on completing the regular assessment as required under s. 214(1) of the IT Act, 1961. The assessee did not file an appeal but made an application for rectification under s. 154 requesting the ITO to pay interest under that provision. The ITO having not paid interest as required of him, by an application under s. 154, the matter went in appeal before the AAC and the Tribunal. Thus, the competency of appeal against non-payment of interest under s. 214, as such, was not involved in these proceedings. In this view of the matter, the first question does not really arise as a question of law and is, not answered.

As regards question Nos. 2 and 3, Shri Munim, the learned counsel for the assessee, has invited our attention to our Court''s judgment in the case of Commissioner of Income Tax Vs. Tata Chemicals Ltd., , in which, having regard to the Circular Instruction No. 947 dt. 23rd April, 1976, issued by the CBDT, it was held that interest under s. 214 was payable to an assessee upto the date of the order of rectification.

This position has not been disputed by Dr. Balasubramanian for the Revenue Accordingly, following our Court''s judgment (supra), we answer the second and third questions in the affirmative and in favour of the assessee.

No order as to costs.