ORDER

PER VIKAS AWASTHY, JM:

This appeal by the assessee is directed against the assessment order dated 24th January, 2017 passed under Section 143(13) read with Section 144C(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’), for the assessment year 2013-14.

This appeal is in second round before the Tribunal. This appeal was originally decided by the Tribunal vide Order dated 10th July, 2024. Thereafter, the assessee filed Miscellaneous Application i.e., M.A. No.25/Del/2025 under Section 254(2) of the Act stating that the additional grounds of appeal raised by the assessee vide Application dated 17/4/2023 for admission of additional grounds under Rule 11 were not decided by the Tribunal. The Tribunal, vide Order dated 5th August, 2025, allowed aforesaid Miscellaneous Application. The operating part of the order in M.A. No.25/Del/2025 reads as under:-

“5. Hence the appeal of Assessment Year 2013-14 is recalled for the limited purpose of adjudication of chargeability of interest under section 234B and 234C of the Act raised in additional ground in respect of additional income pursuant to APA. The registry is directed to fix the main appeal for the Assessment Year 2013-14 for hearing on 30-9-2025 after sending notice of hearing to both the parties.”

The additional grounds of appeal raised by the assessee vide application dated 17th April, 2023, that remain to be adjudicated, are as under:-

“1. That on the facts and circumstances of the case and in law, the education cess (“EC”) and secondary and higher education cess (“SHEC”) on Income Tax is an allowable expenditure for computing total income as per the provisions of the Income-tax Act, 1961.

2. That on the facts and circumstances of the case and in law, the Ld. AO has erred in levying interest u/s 234B and 234C of the Income-tax Act, 1961 (‘Act’) on the additional income agreed as per the Advance Pricing Agreement entered between the appellant and the Central Board of Direct Taxes and offered to tax by the appellant in the modified return of income u/s 92CD(1) of the Act.”

Shri Paras S. Savla, appearing on behalf of the assessee submits that in so far as additional ground No.1 relating to education cess and secondary and higher education cess is concerned, the assessee is not pressing the same. In the light of the above statement made by the learned Counsel at the Bar, additional ground No.1 is dismissed as not pressed.

With respect to ground No.2 of appeal, the learned Counsel submits that the assessee had filed its original return of income for assessment year 2013-14 declaring total income of Rs.302,63,71,210/- claiming Foreign Tax Credit (FTC) of Rs.1,60,87,785/-. Thereafter, the assessee filed revised return of income on 31st March, 2015 to enhance FTC claim to Rs.3,60,88,761/-. In assessment proceedings u/s143(2) of the Act, a reference was made to the Transfer Pricing Officer (TPO) on 3/10/2016. The TPO made adjustment of Rs.298,92,61,079/-. The Assessing Officer vide order dated 24/1/2017 confirmed the addition made by the TPO and allowed FTC claim as per original return of Income i.e. Rs.1,60,87,785/-. The assessee carried the issue in appeal before the Commissioner of Income Tax (Appeals). During the pendency of appeal before the CIT(A), the assessee entered into an Advanced Pricing Agreement (APA) on 20th March, 2018. Pursuant to the said APA, the assessee filed modified return on 29th June, 2018 declaring total income of Rs.333,84,68,120/- (including additional compensation of Rs.41,09,18,499/- offered under APA) and claiming FTC credit of Rs.4,88,11,007/-. Consequent to additional compensation offered under APA, the assessee paid interest under Section 234B of the Act at Rs.3,61,81,796/- and under Section 234C at Rs.44,71,149/-. The learned Counsel submits that interest under Section 234B of the Act is payable for default in payment of advance tax beginning from April 1 of the month following the en