206 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH -.-

ITA-173-2013 (O&M)

Reserved on :- 16.01.2025 Date of Pronouncement: 11.02.2025 M.C.Anand ....Appellant VERSUS Commissioner of Income Tax, Jalandhar (Punjab) ....Respondent CORAM : HON'BLE MR. JUSTICE ARUN PALLI HON’BLE MRS. JUSTICE SUDEEPTI SHARMA Present: Mr. Divya Suri, Advocate, with Mr. Yogesh Kumar Mittal, Advocate, for the appellant.

Mr. Ranvijay Singh, Senior Standing counsel for the respondent.

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SUDEEPTI SHARMA, J.

1. The present appeal is preferred under Section 260-A of the Income Tax Act, 1961 (for short, ‘the Act’) for the assessment year 1982-1983 against order of Income Tax Appellate Tribunal, Amritsar Bench, Amritsar, in ITA No.

01/Asr/2011, dated 10.10.2012.

2. The present appeal was admitted for determination of the following substantial questions of law:-

i) Whether on the facts and in the circumstances of the case, the Tribunal order is sustainable on the true & correct interpretation of the Provisions of Section 154, 220(2) in setting aside the proceedings, read with the CBDT Circular No.334 of 1982 hence outside the scope of 'mistake apparent from the record'?

ii) Whether on the facts and in the circumstances of the case, the Tribunal’s Order is sustainable for levying interest [u/s 220(2)] from the date of original assessment order, while 'charge' commences from date of fresh demand notice?

iii) Whether on the facts and in the circumstances of the case the 'chargeability of interest' u/s 220(2) 'during proceedings' is to be from the date of fresh demand notice after the reframed assessment in the same 'cause of action'?

3. The brief facts of the case are that the assessment for the year 1982- 1983 was originally framed under Section 143 (3) of the Act on 28.03.1985 at income of Rs.5,34,380/- and a demand of Rs.4,44,325/- was created, which was set aside and restored back to the file of A.O with the direction to frame fresh assessment. Again the assessment was framed on 23.03.1988, which was again set aside on 19.10.1989 and restored back to the file of A.O with the direction to frame fresh assessment. For the third time the assessment was framed on 31.03.1995, which was also set aside on 18.11.1996 and restored back to the file of A.O with the direction to frame fresh assessment. Again the assessment was framed on 30.12.1998, which was again set aside and restored back to the file of A.O with the direction to frame fresh assessment. Finally, the assessment in the present case was framed under Section 143(3) of the Act on 26.03.2002 at the same income of Rs.5,34,380/-, which was originally assessed on 28.03.1985.

4. Originally the demand was created on 28.03.1985 and notice for recovering the demand was issued on 23.03.1988. The demand was, therefore, held to be due to be paid on, as before 28.04.1988. The A.O accordingly computed the interest under Section 220(2) for the period 01.05.1988 to 31.10.1996 at Rs.6,37,225/- in respect of the unpaid demand. The A.O also noted several payments made by the appellant against the tax demand and the period of delay for the payment made and computed further interest under Section 220(2) of Act of Rs.1,56,629/- for the period from 01.11.1996 till 22.03.2000. The total interest under Section 220(2) of the Act, till 22.03.2000 was thus computed at Rs.7,93,855/-, therefore, the A.O issued notice under Section 154 of the Act to the appellant proposing to charge interest under Section 220(2) of the Act.

5. The appellant objected to the proposed charging of interest on the ground that certain interest under Section 220(2) of the Act had already been charged by the Department vide order dated 22.07.2000 amounting to Rs.1,20,859/- and that the TRO had also charged interest under Section 220(2) of Rs.1,18,736/- vide letter dated 15.09.2000.

6. The further ground for objection by the appellant was that the interest under Section 220(2) of the Act had already been charged and the same could not be rectified again by extending th