COMMISSIONER OF INCOME-TAX VS MOHTA CONSTRUCTIONS CO
1999 P T D 2181
[227 I T R 124]
[Rajasthan High Court (India)]
Before B. R. Arora and A. S. Godara, JJ
COMMISSIONER OF INCOME-TAX
Versus
MOHTA CONSTRUCTIONS CO
D. B. Income-tax Reference No. 60 of 1995, decided on 13/05/1996.
Income-tax---
----Deduction of tax at source---Interest---Excess amount deducted at source---Interest is not allowable on such excess---Indian Income Tax Act, 1961, Ss. 194-C & 214.
Interest is not allowable under section.214 of the Income Tax Act, 1961, on the excess amount of tax deducted at source under section 194-C o. the Act.
CIT v. Hindustan Engineering Co. (1995) 215 ITR 527 (Raj.) and Lord Krishna Bank Ltd. v. ITO (1989) 176 ITR 508 (Ker.) fol.
Sandeep Bhandawat for the Commissioner.
B. C. Mehta for the Assessee.
JUDGMENT
B. R. ARORA, J.---The Income-tax Appellate Tribunal, Jaipur Bench, Jaipur, for the assessment years 1985-86 and 1986-87, in the case of the assessee, has referred the following question of law for the opinion of this Court:
"Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was legally justified in directing to allow interest under section 214 on the excess amount of tax deducted at source under section 194-C of the Income Tax Act, 1961?"
An identical controversy on identical facts came up for consideration before the Division Bench of this Court in CIT v. Hindustan Engineering Co. (1995) 215 ITR 527 and the Division Bench answered the question in the negative, i.e., in favour of the Revenue and against the assessee, by holding that (page 529) "subsection (2) of section 214 of the Act is not applicable to the refunds from amounts deducted at source. It speaks of any portion of such amount which is refunded under this Chapter. The word 'such' refers to subsection (1) of section 214 dealing with advance payment of tax and not with tax deducted at source".
The same view has also been taken in Lord Krishna Bank Ltd. v. ITO (1989) 176 ITR 508 (Ker. ).
For the same reasons given in CIT v. Hindustan Engineering Co. (1995) 215 ITR 527, this reference is answered in favour of the Revenue and against the assessee and it is held that the Income-tax Appellate Tribunal, Jaipur Bench, Jaipur, was not legally justified in directing to allow interest under section 214 on the excess amount of tax deducted at source under section 194-C of the Income-tax Act.
A copy of this judgment/order may be sent to the Registrar, the Income-tax Appellate Tribunal, Jaipur Bench, Jaipur, as required under section 260 of the Income-tax Act.
M.B.A./2044/FC???????????????????????????????????????????????????????????????????????????????? Order accordingly.