Commissioner of Income Tax vs Sant Ram Mangat Ram Jewellers and Others

1. Heard the learned counsel for the parties.

The appellant shall pay Rs. 10,000 as costs because of the delay of 247 days in filing these special leave petitions.

Delay condoned.

Leave granted.

This appeal is filed against the judgment and order dated September 20, 1999, passed by the income tax Settlement Commission holding that for the assessment year 1993-94 waiver of interest chargeable u/s 234B of the income tax Act, 1961, is restricted to 50 per cent. It is the contention of learned counsel for the appellant-Revenue that the said order is illegal and erroneous, in view of the judgment rendered by this court in Commissioner of Income Tax, Mumbai Vs. Anjum M.H. Ghaswala and Others, and also the decision rendered by this court in C. A. Nos. 7966-7967 of 1996 entitled Commissioner of Income Tax Vs. Hindustan Bulk Carriers, .

As against this, learned senior counsel appearing on behalf of the respondents submitted that in the judgments rendered by this court in Commissioner of Income Tax, Mumbai Vs. Anjum M.H. Ghaswala and Others, as well as in Commissioner of Income Tax Vs. Hindustan Bulk Carriers, , the court has not considered Explanation 1 u/s 234B of the income tax Act and, therefore, the said issue requires reconsideration.

In our view, after the pronouncement of the judgment in Commissioner of Income Tax, Mumbai Vs. Anjum M.H. Ghaswala and Others, , it is not open to us to reconsider the same as it has been specifically held that the Settlement Commission has no power to waive mandatory interest as contemplated under Sections 234A, 234B and 234C of the income tax Act.

In this view of the matter, these appeals are allowed and the impugned order passed by the Settlement Commission is set aside. It would be open to the Revenue to recover interest as provided under the Act. There shall be no order as to costs.