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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
JAGMOHAN BANSAL, AMARINDER SINGH GREWAL
Impact leasing pvt. Ltd. – Appellant
Versus
Additional Commissioner – Respondent
JUDGMENT :
JAGMOHAN BANSAL, J.
1. The petitioner through instant petition under Articles 226/227 of the Constitution of India is seeking setting aside of order dated 02.11.2004 to the extent respondent has rejected its application seeking waiver of interest for the Assessment Year 1996-97 and 1997-98.
2. The petitioner is engaged in the business of hire purchase and finance of automobile. It is generating income in the form of hire purchase charges. As per Section 4 of Interest Tax Act, 1974 (for short ‘1974 Act’), a tax known as interest tax is payable on the income of interest. A taxable person is required to file return of chargeable interest. The assessee is further required to pay advance interest tax. In case of non-filing of return of chargeable interest, as per Section 12 of 1974 Act, there is liability of interest. As per Section 12A, there is further liability of interest in case of default of payment of tax in advance. As per Section 12B, there is also liability of interest for deferment of interest tax payable in advance. There was confusion with respect to liability of assessee engaged in the business of hire purchase. Central Board of Direct Taxes (for short ‘CBDT’) vid
“Interest” element cannot be compared to consideration for lease/hire which is in nature of remuneration (consideration) for hire.
The court established that old age and illiteracy are significant factors for considering waiver of interest under the Income Tax Act, emphasizing the need for fair assessment in tax matters.
A party's financial hardship does not justify a waiver of statutory interest under the Income Tax Act, which demands adherence to specific CBDT criteria for such waivers.
The court emphasized the necessity for a reasoned order addressing all material contentions raised by the petitioner, particularly regarding the impact of the COVID-19 pandemic on estimating income f....
Interest on tax is payable from the date of the first assessment order if not paid within the specified time.
The main legal point established in the judgment is that interest under Section 24(3) of the TNGST Act can be imposed only if an assessment has been framed, determining the additional turnover and ra....
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