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2007] 292 ITR 81 [2007] 164 TAXMAN 580 (PUNJ. & HAR.) HIGH COURT OF PUNJAB AND HARYANA Commissioner of Income-tax v. Upper India Steel Mfg. and Engg. Co. (P.) Ltd. M.M. KUMAR AND RAJESH BINDAL, JJ. IT REFERENCE NO. 80 OF 1988 JANUARY 16, 2007 Section 216 of the Income-tax Act, 1961 - Advance tax - Interest payable by assessee in case of underestimate - Assessment year 1982-83 - Assessee during previous year relevant to assessment year in question filed an estimate of advance tax payable, determining its liability at Rs. 46,12,500 and paid two equated instalments before due dates - Just close to last date for deposit of final instalment, assessee revised estimate of advance tax payable determining advance tax liability at Rs. 68,88,000 and paid balance advance tax with final instalment which resulted in short payment of first two instalments - Assessing Officer charged interest under section 216 holding that there was a deliberate attempt on part of assessee to underestimate advance tax - Whether since assessee never submitted any explanation to show reason for paying lesser advance tax in first two instalments and reason for revision of estimation of advance tax at time of payment of final instalment, assessee was liable to pay interest under section 216 - Held, yes FACTS During the previous year relevant to the assessment year 1982-83, the assessee filed an estimate of advance tax payable, determining its liability at Rs. 46,12,500. As per the estimate filed, the first two instalments of Rs. 15,37,500, each were paid by the assessee before the due dates. However, just close to the last date for deposit of the final instalment on 15-3-1982, the assessee revised the estimate of advance tax on 12-3-1982, determining the advance tax liability at Rs. 68,88,000. The balance amount of advance tax was paid by the assessee with the final instalment. This resulted in short payment of the first two instalments of advance tax which would have been of Rs. 22,96,000 each as against Rs. 15,37,500 paid by the assessee. As the assessee deferred in payment of the first two instalments, the Assessing Officer charged interest under section 216. The levy of interest was upheld…

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