MOHAMMAD YOUSUF Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THESE are two writ petitions (Civil Writ Petitions Nos. 13865 and 13599 of 1996) filed by two brothers, namely, Mohd. Yousuf and Mohd. Rehmat Ullah, respectively, under Article 226 of the Constitution for quashing the orders passed by the Commissioner of Income-tax, Patiala* for the assessment years 1988-89 and 1987-88. Since the facts and questions arising in both the petitions are identical, these are being decided together.

(2.) BOTH the petitioners herein had invested, as partners, certain money by way of capital in a partnership-firm, Azad Rice Mills, Malerkotla. The Assessing Officer issued notices under Section 147 read with Section 148 of the Income-tax Act, 1961 (for short, "the Act"), on the ground that certain taxable income had escaped assessment. BOTH the petitioners filed returns of income, showing only agricultural income. Notices had been issued for the assessment years 1987-88 and 1988-89. Since the present writ petitions relate to a question regarding waiver of interest for the assessment years 1987-88 and 1988-89 the facts relevant to those orders are being examined.

(3.) INTEREST under Section 139(8) of the Act is chargeable if an assessee files return after the due date or fails to file the return. INTEREST is charged on the amount of tax which is found payable by the assessee at the time of assessment. INTEREST under Section 217 is chargeable if an assessee fails to file the statement or the estimate of advance tax and does not pay the advance tax. INTEREST is to be computed on the amount of assessed tax.