Income-tax----

‑‑‑‑Advance tax‑‑‑Interest‑‑‑No opportunity before levy of interest‑‑‑Nat a speaking order‑‑‑Matter remanded‑‑‑Indian Income Tax Act, 1961, S.215.

The assessee filed a return of income on June 28, 1984, declaring a total income of Rs.15,76,580. The Inspecting Assistant Commissioner of Income‑tax completed the assessment on February 3, 1987, determining the total income at Rs.28,01,140. While completing the assessment, he made certain disallowances and also levied interest of Rs.13,94,328 under section 215 of the Income Tax Act, 1961. The main grievance of the assessee was that while levying interest under section 215 of the Act the Inspecting Assistant Commissioner did not give any opportunity to the assessee before passing the order and the order' passed by the Inspecting Assistant Commissioner was not a speaking order. On a writ petition filed by the assessee, the matter was remanded for fresh disposal after giving an opportunity to the assessee.

Malayalam Plantations (India) Ltd. v. CIT (1988) 174 ITR 587 (Ker.) and M.G. Brothers v. CIT (1985) 154 ITR 695 (AP) ref.

P.P.S. Janarthana Raja for Petitioner.

S.V. Subramaniam for C.V. Rajan for Respondents.

JUDGMENT

Invoking Article 226 of the Constitution of India, the petitioner herein has filed the present writ petition seeking for a writ of certiorarified mandamus to call for the records of the first respondent in C. No. 1121 (75)111 of 1988, and consequently to direct the first respondent to grant to order waiving interest for the assessment year 1984‑85 to the petitioner.

In support of the writ petition, the petitioner herein has filed an affidavit where he has, narrated all the facts and circumstances that forced him to file the present writ petition and requested this Court to allow the writ petition as prayed for. Per contra, on behalf of the respondents, a counter -affidavit has been filed rebutting all the material allegations levelled against them one after the other and ultimately requested this Court to dismiss the writ petition for want of the merits.

Heard the arguments advanced by learned counsel appearing for the respective parties. I have perused the contents of the affidavit and the counter‑affidavit together with all the relevant material documents available on record in the form of typed set of papers. I have also taken into consideration the various points raised by learned counsel appearing for the respective parties during the course of their arguments.

In the above circumstances, the only point that arises for consideration in this writ petition is, as to whether there are any valid , grounds to allow this writ petition or not.

In this case the petitioner herein filed a return of income on June 28, 1984, declaring a total income of Rs.15,76,580. The second respondent herein completed the assessment only on February 3, 1987, determining the total income of Rs.28,01,140, while completing the assessment, he made certain disallowances and also levied interest of Rs.13,94,328 under section 215 of the Income-tax Act. The main grievance of the petitioner herein is that while levying interest under section 215 of the Income‑tax Act the second respondent did not give any opportunity to the petitioner before passing the order and the order passed by the second respondent is not a speaking order. Inter alia, it is contended by the petitioner that before levying interest‑under section 215 of the Income‑tax Act the respondent did not give an opportunity to the petitioner. Failure to give an opportunity to the petitioner amounts to violation of the principles of natural justice. He also states that the High Court have taken the view that failure to give an opportunity, before levying a penalty is bad and not in accordance with law. In this regard, learned counsel relied on the following judgments of the Supreme Court (sic) (1) Malayalam Plantation's case (1988) 174 ITR 587 (Ker.); and (2) M.G. Bros's case (19851 154 ITR 695 (AP). That apart he also relies on a case decided by this Court in W.P. No. 11477 of 1986, dated December 20, 1986. It is also contended by learned counsel for the petitioner that the order for levying of interest by the respondent should be a speaking order and in the this case, no reason is given by the respondent and it is a non‑speaking order. It is contended by the petitioner that the order should contain reasons and without giving .proper reasons the order passed by the respondent is illegal, bad and without, any justification. Therefore, he states that the passing of a non‑speaking order amounts to violation of the principles of natural justice and the same is to be quashed. It is also contended by the petitioner that he filed the return of income on June 28, 1984, and the same was completed by the respondent after a period of 31 months. Therefore, it is their case that if the officer had completed the assessment earlier, the levy of interest would not have been huge amount and also that without the fault of the petitioner, the petitioner should not be penalised and that, therefore, the order passed by the second respondent is contrary to law, facts and without justice. In such circumstances, learned counsel appearing for the petitioner submitted that the matter may be remanded to the second respondent for a fresh disposal after affording sufficient opportunity to the petitioner. In this aspect he relies on the order passed by this Court in W. P. No. 11477 of 1986 and prayed for remand. Having considered the entire material available on record, I am of the clear opinion that to meet the ends of justice, it is just and proper to remand the matter to the second respondent for fresh disposal. Further, as I have come to the conclusion to remand the matter to the second respondent. I am not inclined to go into the merits of the subject‑matter at length as it will amount to interfering with the jurisdiction of the authorities. In that view of the matter, I am also not discussing the decision relied on by the respondents at this stage.

In the result, the writ petition is allowed and the order impugned herein is hereby quashed and the matter is remanded to the second respondent for fresh disposal, after giving an opportunity to the petitioner herein and the second respondent is hereby directed to dispose of the matter on the merits and in accordance with law within ninety days from the date of receipt of a copy of this order. In the circumstances, there will be no order as to costs. Consequently, W.M.P. No. 12960 of 1989 is dismissed.

W.B.A./360/FC

Petition dismissed.