JUDGMENT [ENTITY], J.
1. This reference relates to the assessment year 198081. The question is whether interest under [SECTION] of the [ACT], can be charged in respect of an assessment made under [SECTION] of the [ACT].
2. Shortly stated, the facts are that the assessee, a registered firm, filed its return under [SECTION] of the Act on January 29, 1982. The Income-tax Officer charged interest under [SECTION] of the Act treating the firm as an unregistered firm for the purpose of calculation of interest. The assessee filed an appeal against the said order charging interest under [SECTION] of the Act. The Commissioner of Income-tax (Appeals) allowed the appeal holding that interest could be charged only on regular assessment and not on an assessment or a reassessment made under [SECTION] of the Act. The Revenue took the matter to the Tribunal. The Tribunal, after considering the decision in the case of [PRECEDENT]. held that, where the assessment was made under [SECTION] read with [SECTION] of the [ACT], no interest under [SECTION] could be levied. On the aforesaid facts and circumstances, the following question of law has been referred to this court :
"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in confirming the finding of the Commissioner of Income-tax (Appeals) that interest under [SECTION] of the [ACT], was not leviable where the assessment is made under [SECTION] of the said Act ?"
We have already noted that this case relates to the assessment year 1980-81. [SECTION] has been amended and [SECTION] has been added to it by the [ACT], with effect from April 1, 1985. The Explanation states that where, in relation to an assessment year, an assessment is made for the first time under [SECTION], the assessment so made must be regarded as a regular assessment for the purposes of this sub-section. The said amendment was made effective from the assessment year 1985-86 and, accordingly, it does not apply to the assessment year involved in this case. This amendment would clearly bring out that, prior to the insertion of the aforesaid Explanation by the [ACT], no interest under [SECTION] could be levied where the assessment was completed under [SECTION] read with [SECTION] of the [ACT].
3. The Supreme Court in [PRECEDENT] , has held that levy of interest is part of the process of assessment. Although [SECTION] and [SECTION] do not specifically provide for the levy of interest and the levy is, in fact, attributable to [SECTION] or [SECTION], it is nevertheless a part of the process of assessing the tax liability of the assessee. The condition precedent for levy of interest under [SECTION] of the Act is that the assessment made should be a regular assessment. The expression "regular assessment" has been defined in [SECTION] as an assessment made under [SECTION] or [SECTION]. The definition contained in [SECTION] prevails unless the context requires otherwise. It must be held that, prior to the amendment, only assessment made by the Income-tax Officer under [SECTION] or [SECTION] could be considered as a regular assessment within the meaning of [SECTION] of the Act and it was not possible to expand the scope of the expression "regular assessment" to include other orders of assessment by the Income-tax Officer. Thereafter, where an assessment is made under [SECTION], interest cannot be charged under [SECTION].
4. A similar view has been taken by the Patna High Court in [PRECEDENT]. There, the assessment years involved were 1980-81 to 1982-83. Assessments were completed pursuant to the returns filed in response to notices under [SECTION] for those years. Interest under [SECTION] and [SECTION] was charged. The charge of interest was challenged in a writ petition contending that interest could be levied only if the assessment was made as a regular assessment as defined in [SECTION] of the Act. The Patna High Court held that the assessee in that case filed his return for the first time pursuant to notices under [SECTION] of the Act. From a plain reading of the orders of assessment, it was evident that the assessee was assessed under [SECTION] of the Act, and not independently under [SECTION] alone. The assessment being made under [SECTION], it would not be a regular assessment to warrant the levy of interest under [SECTION]. The same is the view of the Andhra Pradesh High Court in [PRECEDENT].
5. It appears to us that the consistent view of the courts is that, where the assessment is made under [SECTION], no interest could be charged under [SECTION] inasmuch as such assessment is not a "regular assessment" within the meaning of [SECTION] of the Act.
6. For the reasons aforesaid, we answer this question in the affirmative and in favour of the assessee and against the Revenue.
7. No order as to costs.
[ENTITY], J.
8. I agree.