The Chennai bench of the Income Tax Appellate Tribunal (ITAT) granted relief to Apollo Pharmacies and held that sufficient time shall be given to the assessee when the pending petition and a request to keep in abeyance appeal proceedings till the disposal is made.
The assessee filed its return of income declaring a total income of Rs. 1,04,20,68,830/-. The return was processed under Section 143(1) of the Income Tax Act, 1961 by the Centralised Processing Centre (CPC) and accepted total income declared by the assessee, with a demand notice of Rs. 5,78,43,140/-, towards interest payable under Section 234A, 234B and 234C of the Income Tax Act. The case was selected for scrutiny.
In the demand notice, a demand of Rs. 6,25,75,750/- has been raised, on account of interest payable under Sections 234A, 234B, and 234C of the Income Tax Act. The assessee has filed appeals against the order passed under Section 143(1) & 143(3) of the Income Tax Act, before the Commissioner of Income Tax (Appeals) [CIT(A)] and challenged the levy of interest.
The CIT(A), after considering relevant facts and also taking note of the request made by the appellant, in light of the petition filed before the Chairman, CBDT, rejected the arguments of the assessee and upheld the interest charged.
The counsel requested the CIT(A) to keep in abeyance the appeal proceedings, till the petition filed by the appellant before the Chairman, CBDT is disposed of. Although the appellant has requested to keep in abeyance the appeal proceedings, the CIT(A) rejected the request of the assessee and dismissed appeals filed by the assessee.
The Departmental Representative, supporting the order of the CIT(A) submitted that, levy of interest under Sections 234A, 234B, and 234C of the Income Tax Act, is mandatory and consequential in nature and it depends upon total income computed by the Assessing Officer.
The Assessing Officer, after considering relevant facts has rightly levied interest under Sections 234A, 234B, and 234C of the Income Tax Act. The CIT(A), after considering relevant facts rightly sustained the demand raised by the Assessing Officer and their order should be upheld.
The Two-member bench comprising of Manjunatha G (Accountant member) and Manomohan Das (Judicial member) held that when the petition filed by the assessee before the Chairman, CBDT, was pending for disposal, and the assessee requested to keep in abeyance the appeal proceedings till disposal of its petition, the CIT(A) ought to have given sufficient time to the appellant to pursue its application filed before the Chairman, CBDT and keep the appeals in abeyance till disposal of petition by Chairman, CBDT.
Thus, the bench set aside the order passed by the CIT(A) and restored the issue to the file of the CIT(A), and directed the CIT(A) to reconsider the issue after considering the outcome of the petition filed by the appellant under Section 119(20)(b)/119(2)(c) of the Income Tax Act before the Chairman, CBDT. Therefore, the appeal of the assessee was allowed.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
