Law:

Section:

Income tax Act (XI of 1922)---   --- Ss. 18A (5), 34 & 35 Advance tax Excess interest paid to assessee Mode of recovery Proceedings under S. 34 Whether proper.   Excess interest which has been paid to an assessee under section 18 A(5) on his advance tax cannot be recovered by taking proceedings under section 34 of the Income tax Act, 1922, though such interest can tie recovered under section 35.   Simplex Mills Ltd. v. Subramanyam, Income tax Offtcer (1958) 34 I T R 711 and Commissioner of Income tax v. Nonshi Devshi Kattawala (Private) Ltd. (1962) 45 I T R 47 fol.   STATEMENT OF CASE   By this application, the Commissioner of Income tax requires the Appellate Tribunal to refer to the High Court a question of law which is said to arise out of the Tribunal's Order in I. T. A . No. 11759 of 1957 58 dated November 18, 1958. Inasmuch as, in our opinion, a question of law does arise out of such order, we draw up a statement of the case and refer the question of law to the High Court under section 66 (1) of the Income tax Act.   The assessee is a private limited company. The assessment for 1952 53 was completed under section 23 (3) of the Act on October 8, 1952 on a total income of Rs. 2,75,257. The net demand of tax, after setting off the amounts paid under section 18 A and interest thereon was Rs. 17,249 14 0. Interest on advance tax was calculated at 2% in accordance with section 18-A(5) of the Act, as it then stood. On May 24, 1953, by an amendment, interest on advance payment was restricted to 2% on the differences between the payments made and the amount of tax at which the final assessment was made, the amendment to take effect from April 1, 1952. The interest allowed in the original assessment was Rs. 1,879 1 0 whereas the assessee was entitled to only Rs. 839 11 0 as per the amendment. To recover the excess interest of Rs. 1,039 6 0, the Income tax Officer took action under section 34 (1) (b) of the Act. The order of the Income tax Officer under section 23(3) is annexed as Annexure "A" and forms part of the case and also his order under section 34 is annexed as Annexure "B" and forms part of the case.…