| SooperKanoon Citation | sooperkanoon.com/66441 |
| Court | Income Tax Appellate Tribunal ITAT Chandigarh |
| Decided On | Oct-21-1993 |
| Judge | J Kathuria, N Agrawal |
| Reported in | (1994)49ITD57(Chd.) |
| Appellant | Hero Cycles (P.) Ltd. |
| Respondent | Surtax Officer |
2. The assessee has challenged the charging of interest under Section 7C amounting to Rs. 3,33,410 and also Under Section 7D amounting to Rs. 5,176. The 1d. counsel Sh. Subhash Aggarwal, at the outset, submitted that he would not press ground No.l relating to charging of interest Under Section 7D of the Companies Profits (Surtax) Act, 1964, hereinafter called the Act. Ground No. 1 is, therefore, rejected as such.
3. Now, ground No. 2 is the only ground which remains under challenge regarding charging of interest Under Section 7C of the Act. The facts of the case are that the assessee's company is required to pay sur-tax.
The accounting year of the assessee ended on 30-6-1981. Statement of advance sur-tax as required Under Section 7A, was filed on 10-6-1981 showing amount of sur-tax payable at Rs. 8,21,241. Under Section 7A(4)(a), three different dates for three installments have been specified, according to which installments of advance surtax are to be paid on the 15th day of June, the 15th day of September and the 15th day of December. The assessee, however, paid a sum of Rs. 2,73,800 as advance surtax on 11-6-1981. An estimate was filed on 10-9-1981 showing surtax payable at Rs. 2,73,000.
Revised estimate was filed in December 1981, showing surtax payable at Rs. 6,69,500. The assessee paid second installment of surtax at Rs. 3,95,700 on 13-12-1981. In this way, total advance surtax paid by the assessee was to the tune of Rs. 6,69,500. The Assessing Officer, while framing the assessment, determined the surtax liability at Rs. 15,58,640. After determining the said surtax liability, interest was also charged Under Sections 7C and 7D on the ground that advance surtax paid by the assessee was less than 831/3% of the assessed surtax.
Section 7C(1) requires a company to pay advance surtax payable Under Section 7A on the basis of its own estimate. It also requires the charging of simple interest @ 12% per annum, if the advance surtax paid by the assessee is less than 831/3 per cent of the assessed tax. Simple interest is to be computed from the 1st day of April next following the relevant financial year up to the date of the regular assessment.
Interest is payable on the amount by which the advance surtax paid by the assessee falls short of the assessed surtax. The surtax liability was determined in the case of the assessee on the basis of income as assessed by the A.O. in the income-tax proceedings. The assessee had shown income at Rs. 1,69,15,170 in its return, whereas the income was determined by the A.O. at Rs. 2,57,31,363. It was because of the enhancement made in the income of the assessee that the surtax liability also increased. It is on that account that the interest Under Section 7C of the Act has been levied.
4. The 1d. D.R., Mrs. Saroj Bala, at the outset, raised a legal objection that the appeal was not maintainable.
It has been pointed out that assessee made an application Under Section 17 of the Act before the Commissioner, seeking reduction of waiver of the amount of surtax. This application was partly allowed, vide order dated 28-2-1986. By that order, an amount of Rs. 1,63,121 has been waived and the interest charged Under Section 7C has been reduced to Rs. 1,70,289. The A.O. by his order dated 31-3-1986 gave effect to the order of the Commissioner and revised the demand so as to reduce the amount of interest. The 1d. D.R. has, therefore, contended that since the assessee had exhausted a remedy by way of filing a revision Under Section 17 of the Act, the assessee had no night to come by way of an appeal against the same subject-matter. It has been contended that the assessee adopted two remedies simultaneously - one by way of filing an appeal before the Commissioner (Appeals), and the other by way of an application Under Section 17 of the Act. It has been argued that the two simultaneous remedies cannot be adopted and, therefore, the appeal was not maintainable. It has also been submitted that while making a request to reduce or waive the amount of interest, the assessee had admitted the chargeability of interest and, therefore, the assessee cannot now take a plea that its appeal is against the chargeability of interest. The 1d. D.R. has placed reliance on a decision of the Calcutta High Court in the case of Smt. IchhabaiPanchalv. CWT [ 1982] 137 ITR 232 wherein the question involved was whether an appeal lay against the order of the Commissioner passed Under Section 18(2) of the Wealth-tax Act. It was observed in that case that the moment the assessee chooses to go to Commissioner for a reduction or waiver of penalty, he admits the position that penalty was imposable. If, on that basis, any order is passed, he cannot feel aggrieved by such an order.
It appears that the question which came to be examined was whether an appeal lay against the order of the Commissioner relating to waiver or reduction of penalty. Here, the assessee is not in appeal against the order of the Commissioner passed Under Section 17 but on the ground that interest Under Section 7C is not chargeable at all. Therefore, the ratio of the judgment is on a different question. The 1d. D.R. has also placed reliance on a decision of the Panjab and Haryana High Court in the case of Jaswant Singh v. CIT [ 1986] 160 ITR 949, where the Commissioner had rejected the application filed Under Section 273A of the Income-tax Act for waiver of penalty imposed Under Section 273 and interest charged Under Section 139(8) and 217. It was held there that the order of the Commissioner was not sustainable inasmuch as the question of waiving the imposition of penalty was not decided on merits. We, therefore, find that the said decision is on different set of facts. Reliance has also been placed by the 1d. D.R. on a decision of the Punjab and Haryana High Court in the case of Amrik Singhv. CWT [ 1988] 170 ITR 656. In that case, the Commissioner has granted certain relief by reducing the amount of penalty on an application of the assessee Under Section 18(1)(a) of the Wealth-tax Act. The WTO thereafter passed an order to give effect to the Commissioner's order.
The assessee filed an appeal against the order of the WTO. It was held that since the order of the WTO was not an independent order but had been passed by him to give effect to the order passed by the Commissioner, it could not be the subject of appeal. This decision is also on a different point which is not involved in the case before us.
Here, the assessee has not filed appeal against the order of the ITO passed on 31-3-1986, in consequence of the order of the Commissioner passed Under Section 17. Here, the appeal has been filed against the original charging of interest by the A.O., uide order dated 30-3-1985.
The 1d. D.R. has also invited our attention to another decision of the Punjab and Haryana High Court in the case of CWT v. Shri Ravi Kumar Cement House [1992] 195 ITR 474. In that case also, the question which had arisen was whether an appeal lay against the order of the WTO whereby effect was given to the order of the Commissioner passed Under Section 18(2A). As we have already seen, the present appeal has not been filed against the order of the WTO giving effect to the order of the Commissioner but this is against the chargeability of interest which had been originally charged at Rs. 3,33,410. Therefore, the said decision also does not help the revenue on this point. Reliance has also been placed by the 1d. D.R. on a decision of the Supreme Court in the case of Aundal Ammal v. Sadasivan Pillai AIR 1987 SC 203. That was a case where the question of filing an application of revision came to be considered under the Kerala Buildings (Lease and Rent Control) Act, 1965. There, the question had arisen whether a second revision could be filed before the High Court Under Section 115 C.P.C. Since the Kerala Act of 1965 had already a provision regarding revision, it was held that the second revision could not be filed Under Section 115 C.P.C.Therefore, the said decision also is altogether on a different point.
5. The 1d. counsel has, in reply, contended that the appeal is primarily on the question of chargeability of interest and is, therefore, competent. He has argued that Section 17 of the Act provided for filing of an application for revision. The period of limitation under Sub-section (3) was one year from the date on which the order in question is communicated to the assessee. The A.O. had made the assessment order on 30-3-1985 and, therefore, application Under Section 17 could be filed by 30-3-1986. Therefore, the assessee moved an application Under Section 17, though the appeal before the Commissioner had already been moved but it was not decided. The appeal came to be decided much later, i.e., on 23-11 -1987. It has been contended that by taking recourse to Section 17, the assessee was not debarred to seek remedy on a different ground altogether. Reliance has been placed by the 1d. counsel on a decision of the Supreme Court in the case of Central Provinces Manganese Ore Co. Ltd v. CIT [1986] 160 ITR 961. That was a case where interest Under Sections 139(8) and 215 of the Income-tax Act had been charged. The assessee preferred an appeal Under Section 246(c) raising objections to the total income assessed and to the interest charged Under Sections 139 and 215. At the same time, the assessee also filed two revision petitions before the Commissioner Under Section 264 - one objecting to the levy of interest Under Section 139(8) and the other to the interest levied Under Section 215. In the two revision petitions, the assessee explained the circumstances accounting for delay in filing and under-estimating the advance-tax.
The Commissioner, while dealing with the revision petitions, informed the assessee that he could not interfere so long the appeal filed before the AAC was not heard. On this information, the assessee made an application to the AAC seeking permission to withdraw the ground relating to the levy of interest. The Commissioner, however, dismissed the revision petitions, taking a view that it was not sufficient to withdraw only those grounds raised in the appeal which related to the levy of interest. The Commissioner held the view that the assessee should have withdrawn the entire appeal pending before the AAC. When the matter came before the Supreme Court, it was held that the orders levying interest were appeasable Under Section 246 because that section provided an appeal against an order where the assessee denied his liability to be assessed. It was noted that the levy of interest was part of the process of assessment. Therefore, it was open to the assessee to dispute the levy in an appeal, provided he limits himself to the ground that he is not liable to the levy at all. It was also observed that the levy of penal interest Under Sections 139 and 215 was part of assessment. When such penalty or interest is levied, the assessee is 'assessed meaning thereby that he is subjected to the procedure for ascertaining and imposing liability on him. If the assessee denies his liability to be assessed under the Act, he has a right of appeal to the AAC against the order of assessment. It was further observed that where penal interest is levied Under Section 215 by the order of assessment, the assessee may altogether deny his liability to pay such interest on the ground that he was not liable to pay advance tax at all or that the amount of advance tax determined by the ITO as payable ought to be reduced. The court thereafter did not go further into the question whether the assessee could challenge in appeal his partial liability to be assessed to interest. The court declined to enter into that question and proceeded further to hold that the question of waiver or reduction of interest cannot be subject of an appeal Under Section 246(c) and that is a matter which can more appropriately be dealt with by the Commissioner in exercise of his revisional jurisdiction. The 1d. D.R. has drawn strength from the observations of the Supreme Court in the aforesaid case and has contended that the said authority helps the Revenue, rather than the assessee. The 1d. D.R. contended that the question of reduction or waiver of interest has been clearly held to be a subject of revision and, therefore, on the basis of this observation, the appeal should be held to be incompetent. The 1d. counsel has, on the other hand, contended that he never raised the question of waiver or reduction in the appeal and his main ground is chargeability of interest. He has submitted that the Supreme Court has very clearly and in unambiguous terms observed that where the interest has been levied as part of assessment, the only inference would be that the assessee has been assessed. In that view the of the matter, the assessee has a right to challenge that part of the assessment by which interest has been charged.
6. Looking to the observations of the Supreme Court, we find that the question of chargeability can be raised by the assessee in appeal because order of interest has been passed in assessment proceedings.
The A.O. computed the amount of surtax in his order dated 30-3-1985 and also proceeded to charge interest. Therefore, the charging of interest is a part of assessment proceedings and the observations of the Supreme Court are applicable to the case of the assessee on all fours. As regards the observations of the Supreme Court that a question of waiver or reduction of interest could be a subject-matter of revision, the assessee has rightly pleaded that his appeal was not for reduction of interest but on the question of its chargeability. The assessee is not seeking any reduction or waiver of interest but the appeal is based on the simple ground that no interest is chargeable on the facts and circumstances of the case.
7. The 1d. counsel had also invited our attention to an order of the Tribunal in the case of Oriental Scientific Dyers v. ITO. It was held in that case that an application filed for waiver of interest would not disentitle the assessee from claiming that he denies his liability to be assessed to interest.
8. We have considered the rival contentions and we find that the appeal is competent because it is based on a different ground. The application for revision filed Under Section 17 of the Act was only for reduction or waiver whereas the appeal has been filed questioning the very basis of charge of interest. In view of the decision of the Supreme Court {supra), we find that, the assessee's appeal is competent one.
9. Now, coming to the merits of the case, the 1d. counsel has submitted that the assessee had shown income at Rs. 1,69,15,170 but was assessed at Rs. 2,57,31,363. Addition of Rs. 88,16,197 was the subject of appeal before the Commissioner as well as the Tribunal. Major item of addition related to income from sale of import entitlement amounting to Rs. 53,03,606. Certain other additions were also made by the A.O, besides disallowing certain deductions. As regards addition relating to import entitlement, the 1d. counsel has argued that this item was not shown as income because the assessee was under a bona fide belief that this amount should not be brought to tax and was in the nature of a capital receipt. The first appellate authority, however, sustained the addition on the ground that it was in the nature of profit earned on the sale of import entitlement. The Tribunal, however, upheld the addition on the sole ground that the receipt of income on sale of import entitlement has been brought to tax by an amendment of law with retrospective effect. Before the amendment, there were divergent judicial pronouncements on this question. But after the amendment introduced by the Finance Act, 1990, the receipt from sale of import entitlement was made taxable with retrospective effect from 1-4-1962. Sections 2(24)(va) and 28(iiia) of the Income-tax Act were amended by the Finance Act, 1990.
10. The 1d. counsel has submitted that the amendment made w.e.f.
1-4-1962, was a retrospective legislation and, therefore, since this amendment came on the statute book under the Finance Act, 1990, the assessee was not at all under the belief that such receipts could be subjected to tax by way of retrospective amendment. The question here relates to assessment year 1982-83. It has been submitted by the 1d.
counsel that at the relevant point of time, there was divergence of judicial opinion and the point was not very clear whether income from import entitlement was subject to tax or not. Our attention has been invited to certain judicial decisions in this respect. The decision of the Calcutta High Court in the case of K.N. Daftary v. CIT [ 1977] 106 ITR 998 lays down that where the assessee received import entitlement free of cost and transferred them to others, it constituted a short-term capital gains. The Kerala High Court in the case of Cochin Co. v. CIT [1978] 114 ITR 822 observed that the profit earned by the sale of import entitlement could not be regarded as profits and gains derived from export of goods. It was further observed that the profits could be said to have been derived from the import activity rather than from export. The 1d. counsel has, therefore, submitted that the different observations made by different High Courts did not lay down a clear proposition of law and the assessee was under a mistaken belief that it was entitled to exclude income from tax. Our attention has also been invited to certain other decisions. Full Bench of Madras High Court in the case of Addl. CIT v. K.S. SheikMohideen\1978] 115 ITR243 has held that the profit arising from the sale of import entitlements was not liable to capital gains tax. It was noted that there was no cost of acquisition in terms of money, therefore, in the absence of any cost, there will be no liability to capital gains tax. Observations of the M.P. High Court in the case of Gwalior Rayon Silk Mfg. (Wvg.) Co.
Ltd. v. CIT [1983] 143 ITR 590 are also relevant. It was observed that the profit arising from the import entitlements cannot be included in the value of turnover of export. The 1d. counsel has, on the basis of different observations made by different High Courts, submitted that the question regarding taxability of income received out of sale of import entitlements was not very clear and, therefore, it was on that account that the assessee claimed exemption in respect of that receipt.
Reliance has also been placed on CIT v. Satya Paul[ 1983] 13 Taxman 235 (Cal.) and also on a decision of the Tribunal for assessment year 1972-73 in the case of XYZ & Co. Ltd. [IT Appeal No. 593 (Bom.) of 1979] copy of which has been placed at pages 15 to 18 of the paper book. The 1d. counsel has submitted that the assessee was governed by the different judicial pronouncements, some of which held that the receipt was taxable as capital gains and in some cases it was observed that the receipt was not to be included in the value of turnover of export. It has, therefore, been urged that the assessee should not be penalised for demanding exclusion of income, which was subject-matter of debate before different High Courts. It was only on that account that the Government ultimately brought an amendment in the Income-tax Act, 1961, as late as in the year 1990 and that too by way of retrospective amendment. Such a drastic measure was adopted only because different views were taken by different High Courts on the question. To put the controversy to rest, the Government brought an amendment treating the income as taxable by amending Sections 2(24) and 28 w.e.f. 1-4-1962. Such a drastic retrospective amendment only suggested that it was supposed to be the only way out to end/conclude the controversy raised for the past many years.
11. The 1d. counsel has also invited our attention to various other additions and deductions which were made by the A.O. as well as the first appellate authority. Apart from receipt on account of import entitlements, the assessee had also claimed certain expenses on rectification of goods exported and found defective. An amount of Rs. 8,99,041 was claimed as deduction for those expenses. It was, however, disallowed by the A.O. The matter ultimately came before the Tribunal, where the assessee did not press this ground on the plea that relief was given to the assessee in the next assessment year by the A.O. The Tribunal, therefore, rejected ground No. 4 in I.T.A. No. 125/Chd./88 dated 22-4-1993. It is on that account that the claim came to be rejected on the request of the assessee itself. It has, therefore, been contended by the 1d. counsel that the amount of Rs. 8,99,041 was rightly claimed as deduction but the claim was ultimately dropped on the ground that relief was obtained from the hands of the A.O. in next assessment year. Therefore, the claim was very much sustainable, though it was pressed in next assessment year and was given to the assessee.
Therefore, it has been contended that the claim made by the assessee could not be said to be false and, therefore, the return filed and the income disclosed through the return could not be said to be unrealistic. Similarly, another claim for rectification charges was also not pressed before the Tribunal as ground No. 4B. It was claimed that the relief has been received in the case of sister-concern, Highway Cycle Ind. The claim related to certain other rectification charges amounting to Rs. 3,42,048.
12. The assessee had claimed depreciation at Rs. 44,84,423 but it was allowed at Rs. 39,51,826 by the A.O. Similarly, deduction Under Section 35B was claimed at Rs. 18,54,157 but was allowed at Rs. 7,94,700 only.
In this way, under these two items relating to depreciation and deduction Under Section 35B, claim for about Rs. 16 lakhs was disallowed. A sum of Rs. 1,14,809 is said to have been disallowed by the A.O. out of sales promotion expenses. Similarly, claim for expenses at Rs. 46,899 and Rs. 53,045 was disallowed by the A.O. on account of expenditure on directors/staff and export promotion respectively. The 1d. counsel has, therefore, argued that these deductions were disallowed by the A.O. on different grounds. The assessee could never anticipate that these claims would be rejected. Therefore, income shown in the return could not be said to be untrue or based on incorrect estimate. The assessee had shown the actual claim, though the A.O.differed for certain reasons and certain claims were disallowed.
13. The assessee got certain relief from the Tribunal in quantum matter, which was decided on 22-4-1993 [supra). Claim for weighted deduction regarding commission paid to the parties in India was allowed at Rs. 2,02,430 in ground No. 7. Similarly, in ground No. 13, another weighted deduction to the tune of Rs. 8,77,201 was allowed at 75% and 50% of the expenditure by the Tribunal. This claim was in respect of salary, export exchange, telephone, telex, printing and stationery etc.
Another disallowance of Rs. 67,202 was also allowed by the Tribunal under Rule 6B in ground No. 16. Claim relating to expenditure on export promotion at Rs. 53,045 was partly allowed by the Tribunal in ground No. 19. The Tribunal gave certain more relief of the assessee while deciding grounds Nos. 20 to 25 in respect of multiple shift allowance, depreciation on tube well, triple shift allowance on generator, disallowance Under Section 80G, claim Under Section 80K and terminal depreciation at Rs. 61,199. These claims having been allowed, indicate that the assessee's claim was not altogether baseless or totally incorrect. Only because certain claims were allowed in full and certain claims were rejected, would not go to prove that the returned income was based on any imaginative proposition. The 1d. counsel has, therefore, argued that the assessee got certain relief from the first appellate authority and thereafter more relief from the Tribunal in the income-tax assessment matter. Therefore, his main plank of argument is that the income returned could not be said to be baseless and, therefore, payment of advance surtax on the basis of returned income could also not be said to be inadequate or incorrect. The assessee had paid a total sum of Rs. 6,69,500 as surtax. The 1d. counsel has submitted that on the basis of the returned income shown at Rs. 1,69,15, 170, the chargeable profits would come to Rs. 13,07,994.
Surtax on chargeable profits were computed by the assessee at Rs. 3,26,999. As against that computation of the assessee, the amount of surtax paid was Rs. 6,69,500. The 1d. counsel has claimed that on the basis of the assessee's computation based on returned income, the assessee was entitled to a refund of Rs. 3,42,501. The 1d. counsel has further argued that after the decision of the Tribunal in income-tax matter and after excluding import entitlement the amount of surtax would ultimately come to Rs. 6,93,256, against which the advance surtax paid is to the tune of Rs. 6,69,500. It has, therefore, been argued that if the amount of import entitlement receipt alone is excluded from the income of the assessee, total amount of surtax would not be very different from what the assessee's computation shall be. The 1d.
counsel has contended that the question relating to import entitlements was very complex and controversial one and it was on account of different views on this question that the assessee opted not to pay tax on that income. He has, therefore, vehemently argued that the big claim to the tune of Rs. 53,03,606 should be legitimately excluded for the purpose of the assessee's computation of income.
14. We have considered the rival contentions and we find that the assessee had filed return claiming certain deductions and expenditures, some of which were accepted and some disallowed. As we have already seen, the question relating to receipt on sale of import entitlements was a complex and contentious issue and it was for that reason that the Government brought an amendment in the year 1990 with retrospective effect. We, therefore, find force in the argument that the claim made by the assessee was genuine, bona ftde and legitimate, though it ultimately came to be disallowed with the help of retrospective amendment of law. This amendment came as late as in the year 1990.
Therefore, we find that this is a case where the assessee could not be penalised for not filing a true statement of income and a correct estimate of advance surtax. We see a genuine claim of the assessee in the matter. We have also seen that certain claims relating to deductions and expenditures have been allowed by the Tribunal also.
These relieves also go to suggest that the assessed income was not acceptable by the assessee for certain legitimate reasons. On account of the reliefs given by the Tribunal, we again come to the conclusion that the returned income could not be said to be totally incorrect or unfounded. The assessee was given substantial relief regarding weighted deduction and depreciation. He did not press his claim for rectification charges, which involved substantial amount, because the assessee had received relief either in next assessment year or in case of another concern of the same group. Therefore, it again goes to establish that the assessee's claim was bonaftde and based on sound footing.
15. The 1d. counsel has also invited our attention to the order of the Commissioner passed in the case of penalty Under Section 273(2)(aa) of the Income-tax Act, for assessment year 1982-83. The Commissioner has cancelled the levy of penalty after holding that additions and disallowances were of legal and technical nature. It was also observed that for certain claims, no penalty could be imposed because of an agreement between the assessee and the Commissioner. Certain claims were rejected because there was difference of opinion. The Commissioner also noted that for certain claims, the assessee had bona fide belief that the amount was not taxable. It was for the these reasons that the Commissioner cancelled the penalty Under Section 273(2)(aa). The 1d.
counsel has claimed that the assessee's plea, that his claim was bonafide, has already been accepted in penalty proceedings by the first appellate authority, therefore, the claim should not be treated to be false or baseless for the purpose of chargeability of interest also.
16. The 1d. D.R. has, however, contended that the bona fide pleaded by the assessee could not be looked into for the purpose of determining the liability of paying interest Under Section 7C of the Act. The 1d.
D.R. has drawn our attention to the provisions of Section 7C(1), where the only question required to be seen is whether the amount of advance surtax paid by the assessee was short of the assessed surtax. If the advance surtax paid was less than 83 '/3% of the assessed surtax, simple interest was chargeable. The 1d. D.R. has, therefore, vehemently contended that the assessee was not entitled to put forward his plea, on the ground of bona fides, that no interest was chargeable. The assessee could at best claim reduction on the ground that his claim relating to import entitlements was genuine, but the assessee cannot claim that no interest was at all chargeable. After the decision of the Tribunal in Income-tax matter, the finally assessed tax had been determined and, therefore, there is no escape from the chargeability of interest on the basis of finally assessed income.
17. The 1d. counsel has, in reply, submitted that the levy of interest was not by way of penalty but it is levied by way of compensation. Our attention has again been invited to the observations of the Supreme Court (supra), whereby it has been laid down that interest is levied by way of compensation and not by way of penalty. Interest is levied Under Sections 139(8) and 215 of the Income-tax Act, 1961 because, by reason of omission or default mentioned in relevant provision, the Revenue is deprived of the benefit of tax for the period during which it has remained unpaid. The very period for which the interest is levied under the relevant provision, points to the nature of the levy. If that is borne in mind, it will be apparent that the levy of interest is part of process of assessment. The Supreme Court has further observed that the expression 'penal interest' has acquired usage but is in fact an inaccurate description of the levy. The 1d. counsel has, therefore, contended that it was a fit case where interest could be held to be not chargeable at all. The bona fides of the assessee's claims have been well-established and the returned income could not be held to be totally baseless or unreliable. The very fact, that many claims were allowed, goes to suggest that the computation of advance surtax made by the assessee by way of estimate was not unexpected. The peculiar circumstances of the case make out a case in favour of the assessee that interest could not be charged at all.
18. Looking to the entire facts of the case and keeping in view the peculiar circumstances concerning the entire matter, we are of the view that no interest is chargeable Under Section 7C of the Act. Therefore, ground No. 2 succeeds and the levy of interest is cancelled.