Law:

Section:

It cannot be said that benefit of Instruction No. 400/234/95 IT(B), dated 23-5-1996 would not apply in the case of the petitioners simply because the books of account had been seized after the last date for filing the returns Section 234A of the Income-tax Act, 1961 - Interest chargeable - For default in furnishing return of income - Assessment year 1991-92 - Petitioners had to file return of income before 31-10-1991 for relevant assessment year - They, however, did not file return before due date - On 19-5-1992, search and seizure operation took place and their books of account were seized by income-tax authorities - In June 1992, they made a request to concerned authority for returning books of account so as to enable them to get accounts audited and file return - Authorities returned books of account in October 1992 - Thereafter accounts were audited and ultimately returns were filed in March 1993 - Assessing Officer levied penal interest under section 234A - Whether during period when books of account were in custody of concerned income-tax authorities, petitioners could not have filed return and, therefore, they were not to be saddled with liability to pay penal interest under section 234A for that period - Held, yes Circulars and clarifications - Instruction No. 400/234/95 IT(B), dated 23 5 1996 FACTS The petitioners had to file their returns of income before 31-10-1991 for the relevant assessment year. They, however, did not file their returns before the last date. On 19-5-1992, search and seizure operations had taken place and the books of account of all the petitioners had been seized by the income-tax authorities. As the petitioners had not filed their return of income, a request was made to the concerned authority by letter dated 26-6-1992 for returning the books of account or copies thereof so as to enable them to get the accounts audited and file the returns. In pursuance of the said request, relevant copies of the books of account had been returned to the petitioners in the month of October, 1992. Upon getting the same, the accounts were audited in March, 1993 and ultimately the petitioners filed their returns. As the returns had been filed late,…

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