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Power Tools and Appliances Co. Vs. Income-tax Officer - Court Judgment

LegalCrystal Citation
CourtIncome Tax Appellate Tribunal ITAT Kolkata
Decided On
Judge
Reported in(1985)11ITD375(Kol.)
AppellantPower Tools and Appliances Co.
Respondentincome-tax Officer
Excerpt:
.....15-9-1976 and 15-12-1976 as per section 211(1)(i) of the act. he, therefore, urged that since the assessee deposited the amount on 15-12-1976, it was to be treated that payment of advance tax was made before the due date was over. the learned counsel for the assessee, therefore, contended that the provisions of section 154 had no application to the facts of the case. the learned departmental representative, on the other hand, contended that as per section 211(1)(i), the last instalment of advance tax was due on or before 15-12-1976. he urged that para 3 of the scheme provided that deposit in lieu of payment of surcharge on income-tax was to be made at any time before the last instalment of advance tax was due in the case of the assessee, that is to say, by 14-12-1976. he submitted that.....
Judgment:
1. This appeal by the assessee is directed against the order of the Commissioner (Appeals) dated 16-12-1982, by which he confirmed the order passed by the ITO under Section 154 of the Income-tax Act, 1961 ('the Act').

2. While making the original assessment, the ITO had given credit for the deposit of Rs. 26,638 made on 15-12-1976 under the Companies Deposit (Surcharge on Income-tax) Scheme, 1976. Subsequently, the ITO was of the opinion that he had committed a mistake in allowing such credit inasmuch as per provisions of the aforesaid Scheme, the assessee was required to deposit the amount on or before 14-12-1976. He, therefore, invoked the provisions of Section 154 and withdrew the benefit of credit that was given in the original assessment.

3. On appeal, the Commissioner (Appeals) confirmed the action of the ITO by observing as under: Since the language of the law is very clear that the deposit is to be made before the due date of last instalment of advance tax and since the appellant has not complied with this provision of law, the ITO committed a mistake in allowing the credit for the amount paid on 15-12-1976. The order under Section 154 purporting to rectify this mistake is quite in order and I confirm the order under Section 154, 4. Before us, it was contended by the learned Counsel for the assessee that the lower authorities failed to appreciate the provisions of the relevant Scheme. He urged that in accordance with the provisions of para 3 of the Companies Deposit (Surcharge on Income-tax) Scheme, a deposit in lieu of payment of surcharge on income-tax may be made by a company at any time before the last instalment of advance tax is due in its case. He further urged that in the case of the assessee, advance tax was payable in three instalments on 15-6-1976, 15-9-1976 and 15-12-1976 as per Section 211(1)(i) of the Act. He, therefore, urged that since the assessee deposited the amount on 15-12-1976, it was to be treated that payment of advance tax was made before the due date was over. The learned Counsel for the assessee, therefore, contended that the provisions of Section 154 had no application to the facts of the case. The learned departmental representative, on the other hand, contended that as per Section 211(1)(i), the last instalment of advance tax was due on or before 15-12-1976. He urged that para 3 of the Scheme provided that deposit in lieu of payment of surcharge on income-tax was to be made at any time before the last instalment of advance tax was due in the case of the assessee, that is to say, by 14-12-1976. He submitted that the ITO committed a clear mistake in the original assessment and, therefore, the lower authorities were justified in applying the provisions of Section 154.

5. We have heard the submissions of both the parties and considered the facts on record. It is an admitted fact that the assessee made a deposit of Rs. 26,638, being the last instalment of advance tax for the assessment year 1977-78. The Scheme provided certain amenities to all the companies. Under this Scheme, any company may make deposit with bank in lieu of payment of surcharge on income-tax under Sub-section (6) of Section 2 of the Finance Act, 1976, at any time before the last instalment of advance tax is due in its case. In the case of the assessee, the last instalment for payment of advance tax was due on 15-12-1976. That means, the time for making payment of such advance tax was up to the banking hours on 15-12-1976. The assessee deposited the amount on 15-12-1976. Therefore, it has to be held that the said deposit was made before the time allowed for payment of instalment of advance tax. In any way, it is a controversial point at issue and, therefore, in our opinion, the ITO could not be said to have committed any glaring mistake while allowing credit for the deposit of Rs. 26,638 in the original assessment. Accordingly, it has to be held that the provisions of Section 154 had no application in this case. We, therefore, cancel the order passed by the ITO under Section 154.


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