Karnataka H.C : Where assessee had not brought any material to show that delay on part of revenue in giving seized material was reason for delay in filing return of income, it could not be granted any relief under sections 234A and 234B

High Court Of Karnataka

Sri Sivapriya Shelters (P.) Ltd. vs. DCIT

Section : 234A, 234B

N. Kumar And B. Manohar, JJ.

IT Appeal Nos. 369 & 370 Of 2012

March 11, 2013

JUDGMENT

N. Kumar, J. – These appeals are preferred by the assessee challenging the order passed by the Tribunal rejecting to grant any relief under Sections 234A and 234B of the Income Tax Act, 1961 (for short ‘Act’).

2. The grievance of the assessee was that the seized materials were made available only in July, 2009, after repeated requests and, therefore, the returns u/S 153A of the Act were filed only on receipt of the seized material. The Revenue cannot charge interest for the aforesaid delay. However, the Tribunal relied on the judgment of the Apex Court in the case of CIT v. Anjum M.H. Ghaswala [2001] 252 ITR 1 and held that the assessee has not brought any material on record to show that the absence of seized material or the fact that there was a delay on the part of the revenue in giving the seized material was the reason for the delay in filing the return of income. Therefore, they declined to interfere with the order imposing interest reserving liberty to the assessee to approach the Authorities for waiver of interest, if they so desire. Aggrieved by the said order, these appeals are filed.

3. Learned counsel appearing for the assessee submitted that the Tribunal ought to have considered the reasons for the delay in filing the return as held by this Court in the case of T.P. Indrakumar v. ITO [2010] 322 ITR 454 wherein this Court has held that under Section 234-A and 234-B interest cannot be charged.

4. Section 234A of the Act deals with interest for defaults in furnishing return of income, whereas Section 234B deals with interest for defaults in payment of advance tax. This is based on the principle that whenever the tax is not paid on due date or return is not filed within the time prescribed, the Revenue is deprived of the tax and the assessee would have the benefit of the said amount Therefore, the interest is levied to compensate for such loss. In regard to the aforesaid judgment in the case of T. P. Indrakumar (supra) this Court has observed that to buy peace and avoid further adverse consequences and the Assessing Authority having acted upon this proposition of the assessee and having regard to the peculiar facts and circumstances of this case, the addition of interest under sections 234A and 234B in the case of the assessee was not necessary and not justified. However, in this case, the delay in filing the return was on account of the seized materials not being returned to the assessee and if the said materials were very much available for filing the return under Section 153A of the Act. Then it is open to the assessee to approach the Revenue-Authorities for waiver of interest. Even after making out a case for waiver and the waiver is not granted by the Authorities, then it could be said that the assessee is aggrieved and then he can approach this Court. As rightly pointed out by the Tribunal that no material is brought on record to show that the absence of seized materials or the fact that there was a delay on the part of the Revenue in giving the seized material was the reason for the delay in filing the return of income, the assessee cannot be granted any relief as prayed for. In that view of the matter, we do not see any substantial question of law which arises for consideration in these appeals on merits, admission and consideration.

5. The appeals are dismissed accordingly.

[Citation : 355 ITR 221]

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