Waiver of penalty

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Rajiv (Querist)
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23 January 2011 Hi,

I seek advice on following query:

My uncle, now 84 years, sold a house in 2008 in Delhi at a rate which was more than the then govt.'s circle rate. He being a very honest and patriotic, did entire transaction through check and paid tax on capital gain to govt. However his advisers overlooked the applicability of surcharge on tax and uncle did not pay surcharge. Now in Jan 11, he received notice u/s143. Since surcharge is a valid payment, he is ready to pay the same immediately. This attracts interest on unpaid surcharge for period of default.

I understand, CCIT can waive of penalty i.e. interest . Can we make a valid case to CCIT to waive penalty on unpaid surcharge by him. We wish to save interest, if it possible u/s 234 or any other section. Pl help an honest nationalist !

Thanks in advance....

Rajiv Kapoor

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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23 January 2011 WAIVER OF INTEREST
The CBDT has empowered the CCIT and DGIT to reduce or waive interest
charged u/s 234A / 234B / 234C for the following cases or classes of income for the period and to
the extent they deem fit -

(a) Where, in the course of search and seizure operations u/s 132 -
• Books of account have been seized by the Department, and
• Assessee was not able to furnish the return of income for the previous
year in which such operation took place
• The delay furnishing such return cannot reasonably be attributed to the
Assessee.
(b) Any income other than ‘capital gains’ which was received or accrued
after the date of the first or subsequent installment of advance tax
which was neither anticipated nor contemplated by the taxpayer and
on which advance tax was paid by the tax payer after the receipt of
such income
(c) Any income was exempt for an assessee due order of Jurisdictional
High Court, and subsequently the said sum was taxable due to :
• Any retrospective amendment of law,
• Decision of the Supreme Court
• Decision of a larger bench of the jurissdictional High Court
(which was not challenged before the Supreme Court and hence become
final).
Since no advance tax would normally be paid in respect of such receipts
during the relevant financial year, interest u/s 234B/234C would be levied
for the default in payment of advance tax
(d) Where a return of income -
• Could not be filed by the assessee due to unavoidable circumstances
• Such return is filed voluntarily by the assessee or his legal heirs without detection by the assessing officer.

None of the above conditions are satisfied by the assessee and hence, as per my understanding, petition,if any, for waiver before CCIT will fail.

Rajiv

Rajiv (Querist)
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26 January 2011 Dear Mr.Warrier,

Thanks for your input....

Regards,
Rajiv Kapoor

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