VINEET TALKIES Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) IN compliance with the direction of this court under Section 256(2) of the J.T. Act, 1961, the INcome-tax Appellate Tribunal has drawn up a statement of the case and referred the following question of law for the opinion of this court :

(2.) IN respect of the assessment year 1970-71 for the year ending March 31, 1970, the ITO charged interest amounting to Rs. 6,331 under Section 217(1A) of the I.T. Act for failure on the part of the assessee to make an upward revision of advance tax estimate, as per provisions of Section 212(3A) of the Act. The assessee challenged the order of assessment and also charging of interest under Section 217(1A) of the Act before the AAC. The AAC reduced the total income by Rs. 2,900 but did not entertain the assessee's appeal against the order under Section 217(1A) of the Act, as according to him, Section 246 of the Act did not confer on the assessee any right of appeal against such levy. The assessee then riled a second appeal against the order of assessment and also challenged the charging of interest under Section 217(1A) of the Act. The Appellate Tribunal held that the AAC was justified in holding that Section 246 of the Act did not provide for an appeal against charging of interest under Section 217(1A) of the Act. Thereafter, an application was made under Section 256(1) of the Act for drawing up of a statement of the case and referring the question of law to this court for opinion. The application was rejected. The assessee then filed an application under Section 256(2) of the Act before this court and by order dated November 18, 1980, in Misc. Civil Case No. 112 of 1976, the Tribunal was directed to draw up a statement of the case and refer the aforesaid question of law. Section 217(1A) reads as under :

(3.) ACCORDING to the counsel, an appeal, against levy of interest under Section 217(1A) of the Act, lay under the expression " where the assessee denies his liability to be assessed under this Act" in Clause (c) of Section 246. This Clause (c) is in two parts ; (i) where the assessee denies his liability to be assessed under this Act, or (ii) under any order of assessment under Sub-section (3) of Section 143 or Section 144, where the assessee objects to the amount of income assessed, or to the amount of tax determined, or to the amount of loss computed, or to the status in which he is assessed.