deceased assessee, namely, Shri M.A. Rahim did not pay any advance tax although he had filed estimate of tax payable under section 209A(1) of Income-tax Act, 1961 ('the Act'), for assessment year 1980- 81. advance tax payable according to his own estimate was Rs. 32,938 and tax determined on regular assessment on 30-12-1981 was Rs. 39,812. In assessment order, IAC who made assessment did not charge any interest under section 215 of Act. Commissioner invoked provisions of section 263 of Act as he was of view that non-levy of interest in assessment order was erroneous and prejudicial to interests of revenue. In response to notice issued under section 263, assessee appeared and objected to proceedings under section 263. After considering assessee's objections, Commissioner (Investigation and Survey) passed order dated 27-12-1983 under section 263 directing IAC to invoke provisions of section 215 and levy such interest as is leviable under provisions of said section read with rule 40 of Income-tax Rules, 1962 ('the Rules') after giving due opportunity of being heard to legal representative of deceased assessee. Against said order, present appeal is filed. 2. learned counsel for assessee submitted that provisions of section 263 can be invoked to correct errors in assessment order passed by ITO but not IAC. We are unable to accept this contention. In East Coast Marine Products (P.) Ltd. v. ITO [1983] 4 ITD 73, Tribunal, Hyderabad Special Bench, held that order of assessment made by IAC may be subject to revision by Commissioner. It was observed as under: "It may also be worthwhile mentioning that Legislature has made it clear as to when orders of IAC in matter of assessment can be treated as orders of assessment passed by ITO if we look to provisions of section 125. Section 125 contemplates conferring of powers of ITO on IAC. In such case reference to ITO under Act would mean reference to IAC. In other words, if assessment is made by IAC because of conferring such powers on him under section 125, reference to ITO under section 263 would mean reference to IAC and such order of assessment may be subject to revision by Commissioner. But for specific mention, Commissioner may not be able to revise...." (p. 85) We agree with view of Special Bench. We hold that Commissioner has power to invoke provisions of section 263 even in respect of assessment made by IAC. 3. learned counsel then submitted that when there is no mention of levy of interest under section 215 in assessment order it should be deemed that levy of interest has been waived under rule 40. provisions of section 263 cannot be invoked for non-levy of interest under section 215. Thus, Commissioner had no jurisdiction to pass impugned order. He placed reliance on few decisions. learned departmental representative justified order of Commissioner (Investigation and Survey). He submitted that there is nothing on record to indicate that levy of interest under section 215 has been waived. If interest leviable under section 215 is not levied, Commissioner has ample jurisdiction to invoke provisions of section 263. He placed reliance on few decisions. Alternatively, he submitted that no appeal lies against levy of interest under section 215 and that even indirectly appeal will not lie against order of Commissioner directing assessing authority to levy interest under section 215. In our view, this alternative contention is not well founded. appeal is provided against order of Commissioner made under section 263. 4. We have considered rival submissions. issue is whether provisions of section 263 could be invoked for non-levy of interest under section 215 in assessment order. Under sub-section (1) of section 215, if advance tax paid by assessee is less than 75 per cent of assessed tax, simple interest at rate of 12 per cent per annum shall be payable by assessee upon amount by which advance tax so paid falls short of assessed tax. Under sub-section (4) of section 215, ITO may reduce or waive interest payable by assessee. Rule 40 provides circumstances under which ITO may reduce or waive interest payable under section 215 or 217 of Act. It is clear from above provisions that ITO has been vested with discretionary powers to waive or reduce interest payable under certain circumstances. This will clearly show that ITO will have to exercise his discretion by passing order. order can be regular order or may be order in order sheet itself. We have verified records and found that no such order has been passed by assessing authority. This will clearly indicate that assessing authority has not exercised discretionary power to waive or reduce interest payable under section 215. Thus, action of assessing authority in not levying interest under section 215 is erroneous and prejudicial to interests of revenue, as in instant case, assessee has not paid any advance tax at all and so provisions of section 215 are clearly attracted. Thus, Commissioner has jurisdiction to invoke provisions of section 263 as assessment order is erroneous and prejudicial to interests of revenue on account of omission to charge interest under section 215. 5. In CIT v. Cochin-Malabar Estates Ltd. [1974] 97 ITR 466 (Ker.), ITO did not charge interest under section 215. Commissioner invoked provisions of section 263. On those facts, Kerala High Court held that Commissioner has jurisdiction to invoke provisions of section 263 for non- levy of interest under, section 215 in assessment order. It was further held that Commissioner is entitled to know on what grounds interest had been waived and discretion vested in ITO ranges between right to waive interest completely or reduce it. judicial exercise of discretion is necessary to find out what interest should be charged or whether any interest at all should be charged and naturally being quasi-judicial act, order must state reasons for waiver or reduction of interest. Hence, order under section 215 must state reasons for it. above decision was followed by Calcutta High Court in case of Singho Mica Mining Co. Ltd. v. CIT [1978] 111 ITR 231. above two decisions were followed by Allahabad High Court in Addl. CIT v. Saraya Distillery [1978] 115 ITR 34. It was held therein that since there is nothing in order of ITO to indicate that he has waived interest, it would not be possible to hold that interest has been waived by ITO. Commissioner has jurisdiction to invoke provisions of section 263. In CIT v. City Palayacot Co. [1980] 122 ITR 430, Madras High Court held that in cases for levy of interest under sections 215 and 217, it is not possible to infer any waiver from omission to charge interest especially when power is restricted to particular cases in circumstances prescribed in rule 40. It would be necessary for ITO, if he exercises his discretion to indicate in his order as to why he waives or reduces interest liable to be charged and particular clause in rule 40 may have also to be referred to as that alone would give clue to his exercise of power. charging of interest and omission to do so would be subject to revisional powers of Commissioner under sections 263 and 264 of Act. In cases where ITO has omitted to exercise his jurisdiction, it would be necessary for Commissioner to act under section 263. In that case, it was observed that proper order that should have been passed by Commissioner would be to direct ITO to consider question of levy of interest in context of rule 40. This decision was followed by same High Court in R.R. Pictures v. CIT [1983] 143 ITR 429. It was held therein that act of waiver is conscious overt act on part of ITO and mere omission or inaction on his part to levy penal interest cannot be construed under any circumstances as act of waiver. As ITO in his order omitted to levy penal interest under section 217(1A), Commissioner was justified in directing ITO to consider levy of penal interest. above decisions of four High Courts support revenue. 6. In CIT v. Executors of Estate of Late H.H. Rajkuverba Dowager Maharani Saheb of Gondal [1978] 115 ITR 301, Karnataka High Court held that order under section 215 or section 216 or 217 of Act can be passed only after regular assessment is made and omission to make reference to interest payable under those provisions in order of regular assessment cannot amount to order waiving it and it may be possible for ITO to pass order under section 217. But section 263 cannot be invoked. As there is no order under section 217, it is not prejudicial to revenue. This decision is clearly distinguishable. In fact, in this decision, it was observed that mere omission on part of ITO to refer to penal interest payable under section 215 or 217 in assessment order cannot lead to inference that ITO has waived interest payable without giving any reasons for doing so. This observation supports case of revenue. In this decision, it was held that as no order under section 217 has been passed separately, which could be said to be prejudicial to revenue, provisions of section 263 cannot be invoked. decision of Delhi High Court in case of CIT v. Caxton Press (P.) Ltd. [1981] 129 ITR 462 relied on by assessee's counsel is clearly distinguishable. On facts of that case, it was observed that it was nobody's case that delay in making assessment was on account of any default by assessee and it was case which might justifiably fall under first example given in rule 48 of Rules. foundation of Commissioner's jurisdiction, therefore, did not exist and he could not have set aside order of ITO. This decision is clearly distinguishable on facts of that case. decision of Madhya Pradesh High Court in CIT v. Narpat Singh Malkhan Singh [1981] 128 ITR 77 is also distinguishable. That was case where assessment order had merged with order of AAC. On facts of that case, it was observed that it is not necessary to decide whether order charging interest under section 217 is part and parcel of order of assessment or whether ITO can pass such order even after passing assessment order. Assuming that order under section 217 is part of assessment, assessment order could not be set aside by Additional Commissioner in revision, because it would also result in setting aside order of AAC passed in appeal. Now assuming that ITO is competent to pass order under section 217 even after making order of assessment, Commissioner cannot invoke revisional jurisdiction in absence of any order under section 217. Thus, facts of that case are clearly distinguishable and has no application to instant case. Even if these cases support assessee we prefer to follow majority view. 7. In our view, decisions of majority of High Courts to which we have already referred are in favour of revenue. We respectfully follow those decisions. In instant case, there is nothing in record to show that assessing officer has either waived or reduced interest leviable under section 215. Hence Commissioner had jurisdiction to invoke provisions of section 263 for non-levy of interest under section 215. We may observe that before levying interest under section 215, IAC will consider provisions of section 215 and rule 40 with regard to waiver or reduction of interest if assessee's case falls within circumstances referred to in rule 40. Thus, we uphold order of Commissioner. 8. In result, appeal fails and is dismissed. *** M.A. LATEEF v. INSPECTING ASSISTANT COMMISSIONER