IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR THURSDAY, THE 25TH JUNE 2009 / 4TH ASHADHA 1931 WP(C).No. 33012 of 2005(E) -------------------------- PETITIONER(S): --------------- M/S.N.J.JOSE & CO. (P) LTD., REP. BY JOSEPH VINCENT, MG. DIRECTOR, ERANJIPALAM, KOZHIKODE. BY ADV. SRI.P.BALAKRISHNAN (E) RESPONDENT(S): --------------- 1. THE CHIEF COMMISSIONER OF INCOMETAX, COCHIN. 2. THE ASSISTANT COMMISSIONER OF INCOMETAX, CIRCLE-2, CALICUT. ADV. SRI.P.K.R.MENON,SR.COUNSEL,GOI(TAXES) SRI.JOSE JOSEPH, SC FOR IT THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 25/06/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: APPENDIX PETITIONER'S EXHIBITS: P1: TRUE CFOPY OF ORDER OF ASSESSMENT DT.19.10.95 FOR THE ASSESSMENT YEAR 1989-90. P2: TRUE COPY OF ORDER DT.3.1.1997 OF THE COMMISSIONER OF INCOME TAX (APPEALS). P3: TRUE COPY OF RDER DT.28.9.2001 OF THE INCOME TAX APPELLATE TRIBUNAL. P4: TRUE COPY OF PETITION DT.12.12.2003 ADDRESSED TO R1. P5: TRUE COPY OF ORDER UNDER SECTION 119(2)(a) OF R1. TRUE COPY PA TO JUDGE C.N.RAMACHANDRAN NAIR, J. .................................................................... W.P.(C) No.33012 of 2005 .................................................................... Dated this the 25th day of June, 2009. JUDGMENT Heard counsel for the petitioner and Standing Counsel appearing for the Income Tax Department. Challenge is against Ext.P5 order whereunder the Chief Commissioner has declined petitioner's request for waiver of interest levied under Section 234B of the Income Tax Act. The Chief Commissioner has found that interest under Section 234B is mandatory in nature. However, he has considered the Board's Circular whereunder the rigour of the Section is diluted by giving limited discretionary powers to the Chief Commissioner to waive interest under certain circumstances. It is the finding of the Commissioner that none of the circumstances stated in the Board's Circular applies to the petitioner. However, counsel for the petitioner has referred to clause (c) of para 5 of the Circular and contended that the said provision entitles the petitioner for waiver of interest. However, on going through the provision I find that the same applies to case where substantial amount of income other than by way of capital 2 receipt was received after the due dates for payment of advance tax. There is nothing to indicate that this sub-clause of the Circular applies to the facts of petitioner's case because assessment in this case itself is a Section 115J assessment of book profit. It is the settled position that advance tax is payable on book profit as well. Therefore, the Chief Commissioner rightly found that the petitioner was not entitled to any waiver claimed by them. 2. Counsel for the petitioner pointed out that the company is defunct and has no operations. It is seen from the Chief Commissioner's order that the company's income was mainly from sale of property and in the Section 115J assessment, book profit was reckoned by including long term capital gain as well. No stay was granted by this court when the W.P. was admitted four years back. It is not known whether interest demanded under Section 234B is already recovered or paid by the petitioner. In any case if the said amount is not paid, I waive complete interest thereon and grant time to the 3 petitioner till 31st July, 2009 to pay the balance interest, if any, originally demanded under Section 234B of the Act. The W.P. is disposed of as above. C.N.RAMACHANDRAN NAIR Judge pms