COMMISSIONER OF INCOME TAX v. APEX ELECTRICITY PVT LTD
[Citation -1984-LL-0621-3]

Citation 1984-LL-0621-3
Appellant Name COMMISSIONER OF INCOME TAX
Respondent Name APEX ELECTRICITY PVT LTD.
Court ITAT
Relevant Act Income-tax
Date of Order 21/06/1984
Assessment Year 1979-80
Judgment View Judgment
Keyword Tags reference application • regular assessment • specific direction • levy of interest • mistake apparent • advance tax
Bot Summary: As the last installment was not paid on the stipulated date, the ITO while completing the original assessment charged interest amounting to Rs. 18,584 under s. 215 of the Act, but not treating Rs. 1,63,330 as advance tax. The CIT(A) dismissed the appeal of the assessee and had observed that the 3rd installment of advance tax was paid after the date for payment of the last installment which was due on 15th Dec., 1978. The CIT(A) further observed that under the circumstances the two installments aggregating to Rs. 2,26,650 could be considered as payment of advance tax and last payment made on 11th Jan., 1979 could not be considered as part of payment of advance tax. Is also held that provisions of Indian Contract Act applied as payment was made on advance tax challan in para 6.3. In respect of the second question, it is held in para 6.1 of the order that the ITS himself has treated all the three payments as advance tax and accordingly granted deduction from the tax payable. In respect of question No. 3, rectification under s. 154 is allowed on the basis of findings of facts for the purpose, paras 6 7.0 of the order are relevant. In respect of question No. 4 in para 6:3, it is held that the provisions of Indian contract Act would apply because the payments were made together with the advance tax challans, which were prepared on the basis of estimates filed.


By this application made under s. 256(1) of IT Act, 1961, Revenue desires Tribunal to refer following questions, said to be of law, to Hon'ble Hugh Court of Gujarat: "Whether on facts and in circumstances of case, Tribunal was right in law in deciding validity of levy of interest under s. 215 of IT Act, 1961 in appeal against order refusing l to exercise powers under s.1 54 of IT Act, 1961?" "Whether on facts and in circumstances of case, Tribunal was right in law in holding that payment of last installment tax made after stipulated date for payment thereof could be considered as payments of advance tax?" Whether on facts and circumstances of case, Tribunal was right in law in coming to conclusion that assessee was entitled to order of rectification under section 154 of IT Act, 1961?" Whether Tribunal was right in law in coming to conclusion that provisions of Indian Contract Act, 1882 regarding appropriation of debt apply to payments made as advance tax?" facts leading to present reference are as follows: total income of assessee was Rs. 10,05,629 and tax payable on regular assessment was Rs. 6 33,347. advance tax aid was Rs. 1.63,330 on 16th June, 1978, Rs. 1,63,330 on 14th Nov., 1978 and Rs. 1,63,330 on 11th Jan., 1979, aggregating to Rs. 4,89,990. As last installment was not paid on stipulated date, ITO while completing original assessment charged interest amounting to Rs. 18,584 under s. 215 of Act, but not treating Rs. 1,63,330 as advance tax. assessee applied under s. 154 for deletion of interest. ITO by its letter dt. 28th Aug., 1981 declined to grant relief as there was no mistake apparent from record. CIT(A) dismissed appeal of assessee and had observed that 3rd installment of advance tax was paid after date for payment of last installment which was due on 15th Dec., 1978. CIT(A) further observed that under circumstances two installments aggregating to Rs. 2,26,650 could be considered as payment of advance tax and last payment made on 11th Jan., 1979 could not be considered as part of payment of advance tax. Therefore, interest was leviable under s. 215 because aggregate of two installments namely Rs. 3,26,650 did not amount to 75 per cent of tax levied on regular f assessment. He further held that no appeal could be filed against levy of interest under s. 215. Tribunal, on appeal, by assessee, allowed appeal of assessee on basis of s. 154 vide paras 9 & 10 of order. It gave finding regarding advance tax in para 6.1. Is also held that provisions of Indian Contract Act applied as payment was made on advance tax challan in para 6.3. Tribunal allowed appeal after considering decision reported in Omega Sports & Radio Works vs. CIT(1982) 28 CTR (All) 80: (1982) 134 ITR 28 (All). Comm. of ST vs. Lord Krishna Sugar Mills Ltd. (1964) 15 STC 335 AII) (1964) 15 STC 339 (All), CIT vs. Kohinoor Flour Mills (1975) 99 ITR 54 (Guj) (1975) 99 ITR 54 (Guj), Chandrakant Damodardas vs. ITO (1980) 16 CTR (Guj) 1980) 123 ITR 748, (Guj), Santha S. Shenoys & Ors. vs. Union of India & Ors. (1982)29 CTR (Ker) 127: (1982) 135 ITR 39 (Ker), Dwarka Nath vs. ITO & Anr. (1965) 57 ITR 349 (SC) and decision of Tribunal in I.T.A. No. 1885/Ahd/81 decided on 7th Oct., 1982. At time of hearing of reference application, ld. counsel appearing on behalf of assessee objected to proposed reference in respect of all four questions proposed. We decline to make reference for reasons as follows: In respect of question No. 1, in our opinion, same does not arise out of order of Tribunal. In paras 6 & 10, it is clearly held that validity of levy of interest under s. 215 is not dealt with. In respect of second question, it is held in para 6.1 of order that ITS himself has treated all three payments as advance tax and accordingly granted deduction from tax payable. This is finding of fact which is not challenged. In respect of question No. 3, rectification under s. 154 is allowed on basis of findings of facts for purpose, paras 6 & 7.0 of order are relevant. Therefore, no questions of law arises. in respect of question No. 4 in para 6:3, it is held that provisions of Indian contract Act would apply because payments were made together with advance tax challans, which were prepared on basis of estimates filed. Therefore, provisions of Indian Contract Act are clearly applicable, as specific direction regarding appropriation is given by payer and same had been accepted by ITO by accepting payment itself. Therefore in our opinion, no referable question of law arises In result, application is rejected. *** COMMISSIONER OF INCOME TAX v. APEX ELECTRICITY PVT LTD.
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