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Rasiklal Kamdar (by L. Rs.) Vs. Commissioner of Income-tax - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtChennai High Court
Decided On
Case NumberTax Case No. 301 of 1972 (Referred Case No. 88 of 1972)
Judge
Reported in[1977]109ITR56(Mad)
ActsIncome Tax Act, 1961 - Sections 139(1), 141, 154 and 207(2)
AppellantRasiklal Kamdar (by L. Rs.)
RespondentCommissioner of Income-tax
Appellant AdvocateK. Ramgopal, Adv.
Respondent AdvocateJ. Jayaraman, Adv.
Excerpt:
- .....the income-tax officer deducted the advance tax, the tax deducted at source and also the tax paid pursuant to the provisional assessment made under section 141 of the act. subsequently, the income-tax officer realised that a mistake had been committed in deducting the tax paid pursuant to the provisional assessment under section 141 for the purpose of calculating the interest. consequently, a notice dated march 18, 1968, was issued to the assessee for rectifying the mistake in the assessment order under the provisions of section 154 of the act. the notice was served on the assesses on march 21, 1968. there was no reply from the assessee. thereafter, the income-tax officer, by his order dated march 30, 1968, passed an order under section 154 by rectifying the mistake. what he did.....
Judgment:

Ismail, J.

1. For the assessment year 1962-63, relevant to the accounting year ending on March 31, 1962, the assessee filed his return on April 30, 1964. The Income-tax Officer completed the assessment on March 31, 1967. While calculating the interest payable under Section 139(1)(iii) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act'), the Income-tax Officer deducted the advance tax, the tax deducted at source and also the tax paid pursuant to the provisional assessment made under Section 141 of the Act. Subsequently, the Income-tax Officer realised that a mistake had been committed in deducting the tax paid pursuant to the provisional assessment under Section 141 for the purpose of calculating the interest. Consequently, a notice dated March 18, 1968, was issued to the assessee for rectifying the mistake in the assessment order under the provisions of Section 154 of the Act. The notice was served on the assesses on March 21, 1968. There was no reply from the assessee. Thereafter, the Income-tax Officer, by his order dated March 30, 1968, passed an order under Section 154 by rectifying the mistake. What he did was to add the tax paid pursuant to the provisional assessment made under Section 141 to the tax determined for the purpose of calculating the interest payable under Section 139(1)(iii) of the Act. The assessee preferred an appeal to the Appellate Assistant Commissioner of Income-tax, who confirmed the order of the Income-tax Officer. Thereafter, the assessee preferred an appeal to the Income-tax Appellate Tribunal. Before the Tribunal the assessee contended that under Section 139(1)(iii) even the tax paid pursuant to the provisional assessment was deductible and, therefore, there was no mistake committed by the Income-tax Officer in the original assessment order, which could be rectified under Section 154 of the Act. He also contended that in any event the point was a debatable one and, therefore, it could not be held that the original order of assessment contained an error apparent which could be rectified under Section 154. The Income-tax Appellate Tribunal rejected both these contentions. It is, thereafter, at the instance of the assessee, the Income-tax Appellate Tribunal, under Section 256(1) of the Act, has referred the following questions for the opinion of this court;

'(1) Whether, on the facts and in the circumstances of the case, it has been rightly held that there was a mistake apparent in the original assessment order as warranting a rectification under Section 154?

(2) If the answer to the first question is 'yes', whether it could be hell that in the facts and circumstances of the case the levy of interest under the proviso (iii)(b) to Section 139(1) was valid ?'

2. Section 139 of the Act deals with the return of income. The mainprovision contained in Section 139(1) deals with the time within which thereturn of income has to be filed by an assessee. The proviso to that Section enables the Income-tax Officer to extend the time, on an applicationmade by an assessee in the prescribed manner, for furnishing the return.Clause (iii) of this proviso says :

'Provided that, on an application made in the prescribed manner, the Income-tax Officer may, in his discretion, extend the date for furnishing the return--.....

(iii) up to any period falling beyond the dates mentioned in Clauses (i) and (ii) in which case, interest at six per cent, per annum shall be payable from the 1st day of October or the 1st day of January, as the case may be, of the assessment year to the date of the furnishing of the return-

(a) in the case of a registered firm or an unregistered firm which has been assessed under Clause (b) of Section 183, on the amount of tax which would have been payable if the firm had been assessed as an unregistered firm ; and

(b) in any other case, on the amount of tax payable on the total income, reduced by the advance tax, if any, paid or by any tax deducted at source, as the case may be.'

3. As we pointed out already, in the original order, the Income-tax Officer, in addition to deducting the advance-tax and the tax deducted at source, also deducted the tax paid pursuant to the provisional order of assessment made under Section 141. In the subsequent order made under Section 154, he rectified this mistake by adding the tax paid pursuant to the provisional order of assessment made under Section 41. The learned counsel for the assessee contends that the expression 'advance tax' occurring in the above statutory provision will include all taxes that had been paid prior to the final assessment. The learned counsel's further contention is that the expression 'advance tax' as is mentioned in Section 207 of the Act has got the meaning contained in Sub-section (2) thereof only for the purpose of Chapter XVII and that meaning cannot be given to the expression 'advance tax' occurring in Section 139(1), proviso (iii), and the expression 'advance tax' in this provision means the advance tax as understood by the common man. We are of opinion that even the expression 'advance tax' as understood by the common man, means only the tax paid prior to the assessment andean never mean a tax paid pursuant to an assessment, whether it is a provisional assessment or final assessment. Consequently, the expression 'advance tax ', whether understood as defined in Section 207(2) of the Act or as could be understood by the common man, will mean only one thing, viz., the tax paid before the assessment as required by the Act. As a matter of fact, the Act itself contains elaborate machinery for payment of advance tax and, therefore, wherever the expression 'advance tax' occurs in the Act, it can mean only that advance tax which was 'paid as required to be paid pursuant to the provisions contained in the Act. Therefore, looked at from any point of view, the tax paid by the assessee pursuant to the provisional order of assessment made under Section 141 cannot be comprehended by the expression 'advance tax, if any, paid' occurring in Section 139(1), proviso (in), and, therefore, the Income-tax Officer was right in holding that a mistake had been committed by him in the original order of assessment when he deducted the tax paid pursuant to the provisional order of assessment, also.

4. The next limb of the argument, as we pointed out already, was that the point whether the tax paid pursuant to the provisional order of assessment is included in the expression 'advance tax' occurring in Section 139(1)(iii) is a debatable one and, therefore, the deduction of the tax paid pursuant to the provisional order of assessment cannot be said to be a mistake apparent on the record for the purpose of invoking the jurisdiction of the Income-tax Officer under Section 154 of the Act. We are of the opinion that there is no substance whatsoever in this contention, because, having regard to the statutory language extracted above as contained in Section 139(1)(iii), the expression 'advance tax' can only mean one thing, viz., the advance tax paid pursuant to the requirement of the statute and cannot mean any other amount and, therefore, there is no question of the point being debatable so as to exclude the jurisdiction of the Income-tax Officer under Section 154 of the Act.

5. The result is that we answer both the questions referred to this courtin the affirmative and against the asscssee. There will be no order as tocosts.


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