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High CourtsDivision Bench(1984) 08 KAR CK 0039

Commissioner of Income Tax vs G.J. Fernandez

Karnataka High Court · Decided on 28 August 1984 · Citation: (1987) 60 CTR 143 : (1986) 160 ITR 602 : (1986) 26 TAXMAN 450

HON’BLE JUDGES
S.A. Hakeem, J · Mohammad Sharif, J
CASE NUMBER
Income-tax Reference case No. 45 of 1980

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Judgment

9 paragraphs · 371 words

K. Jagannatha Shetty, J.

1.The following question has been referred u/s 256(1) of the Income Tax Act, 1961, by the Income Tax Appellate Tribunal (Bangalore Bench) :

"Whether, on the facts and in the circumstances of the case, the Tribunal was justified in cancelling the order of the Commissioner of Income Tax made u/s 263 of the Income Tax Act, 1961 ?"

2.

The facts in extenso have been set out in the statement of the case, out of which we may set out only those that are just relevant

3.

For the assessment year 1970-71, the assessee was required to pay advance tax on or before March 15, 1970. He paid the same by three cheques dated : (i) March 12, 1970; (ii) March 12, 1970; and (iii) March 15, 1970. Those cheques were received by the assessing officer on March 16, 1970, and they were also encashed. The assessing officer allowed interest on the excess of advance tax u/s 214. In other words, he proceeded on the basis that the assessee has paid the advance tax within the stipulated time.

4.

But the Commissioner thought otherwise. u/s 263, he revised the order of assessment holding that the assessee paid the tax only on March 16, 1970 and, therefore, he was not entitled to interest u/s 214. He was under the impression that the assessee made a belated payment of the advance tax.

5.

Before the Tribunal, there was no dispute that the last date for payment of advance tax was March 15, 1970. which was a Sunday and the payment was made by the assessee by cheques on March 16, 1970, which was held to be a valid payment. There is also no dispute that the three cheques issued by the assessee were handed over to the assessing officer on March 16, 1970. They were local cheques drawn on a local bank and were duly honoured and the amounts realised were credited to the Government account.

6.

On these facts, one cannot come to the conclusion that the assessee was not entitled to interest u/s 214 which was rightly allowed by the assessing officer.

7.

In the result, we answer the question in the affirmative and against the Revenue.