Wp/31785/2018 Of R.s.suriya v. The Principal Commissioner Of Income Tax

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 04.08.2021 CORAM THE HONOURABLE MR.JUSTICE S.M.SUBRAMANIAMW.P. No. 31785 of 2018 R.S.Suriya ... Petitioner -vs-1. The Principal Commissioner of Income TaxCentral 2,Nungambakkam,Chennai - 34.2. The Deputy Commissioner of Income TaxCentral Circle - II(4),New No.46, M.G.Road,Nungambakkam,Chennai - 34.3. The Assistant Commissioner of Income TaxCentral Circle - II(5),New No.46, M.G.Road,Nungambakkam,Chennai - 34.4. The Assistant Commissioner of Income TaxCentral Circle - II(4),New No.46, M.G.Road,Nungambakkam,Chennai - 34. ... Respondents Prayer : Writ Petition filed under Article 226 of theConstitution of India, praying for issuance of Writ ofCertiorarified Mandamus, calling for the records relating to theproceedings of the first respondent in C.No.2747B/PCIT/C-2(4)/2017-18 dated 31.05.2018, quash the same and consequently,direct the first respondent to waive the interest for theassessment years 2007-2008 and 2008-2009. For Petitioner : Mr.S.Raveekumar For Respondents : Mr.A.P.Srinivas Senior Standing Counsel for IT and Mr.A.N.R.Jeya Prathap O R D E R The lis on hand is instituted questioning the legalsustainability of the rejection order passed by the firstrespondent with reference to the applications submitted by thewrit petitioner claiming waiver of interest under Section 220(2A) of the Income Tax Act, 1961. 2. The petitioner has stated that he is a professionalCine Actor and regularly filing return of income with therespondents. The petitioner follows the cash system ofaccounting as he received payments including advances by cashalso. In the course of his profession, the petitioner receivedadvances by cash with reference to priority in dates beforefinalization of the story or name or co-artists. Such advanceswill be treated as income and brought to books for accountingand taxation, only in the year, when the project materializes asit is common parlance in the industry that many projects wouldbe dropped or delayed due to various reasons, including the callsheet problem. The petitioner sometimes out of movies. While so,he has been facing harassment at the hands of the respondentsfor quite sometime. 3. This being the professional difficulties faced bythe petitioner, it is contended that search operation wasconducted in the premises of the petitioner on 19.10.2010. Theassessment orders were passed by the third respondent on30.12.2011fortheassessmentyears2007-2008and2008-2009. The appeals filed by the writ petitioner before theCommissioner of Income Tax (Appeals) was partly allowed on27.03.2013. As against the same, appeals and counter appealswere filed by the third respondent before the Income TaxAppellate Tribunal. By common order dated 23.08.2013, all theappeals and cross appeals were rejected confirming the orders ofthe CIT(A). However, the third respondent had not given effectto the orders of the Commissioner of Income Tax (Appeals) till25.09.2013 and 27.09.2013, implying that according to thedepartment, the assessment attains finality only after theorders passed by the Tribunal. 4. Under these circumstances, after giving effect tothe orders of CIT(A), the petitioner filed MiscellaneousPetitions before the ITAT seeking relief against Double Taxationfor both the years. The Miscellaneous Petitions were allowed asearly as on 06.06.2014. Again, after a huge delay, the order wasgiven effect only on 29.03.2017, after nearly three years. 4. Under these circumstances, after giving effect tothe orders of CIT(A), the petitioner filed MiscellaneousPetitions before the ITAT seeking relief against Double Taxationfor both the years. The Miscellaneous Petitions were allowed asearly as on 06.06.2014. Again, after a huge delay, the order wasgiven effect only on 29.03.2017, after nearly three years. 5. It is contended that, in the meantime, theassessment for the year 2011-2012 was taken up and the saidassessment year is not connected with the issue raised in thepresent Writ Petition. The petitioner filed rectificationpetition stating that the interest has been levied withouttaking into consideration the pre-paid taxes and that the creditof pre-paid taxes was not given in full and interest underSection 234A cannot be levied as the return was filed in time.The orders were passed on the rectification application on30.03.2017, nearly after three years, accepting the contentionof the petitioner for refund of Rs.2,33,76,590/-. The petitionerstates that the department contributed for the delay in disposalof the application and other actions. Therefore, the petitioneris entitled for the waiver of interest under Section 220(2A) ofthe Income Tax Act. The petitioner made a request to adjust therefund amount due to the petitioner with the demand if any forthe other years from 2014 onwards. However, the request was notconsidered and the interest was unjustly allowed for theassessment years 2007-2008 and 2008-2009. The applications filedby the petitioner under Section 220(2A) of the Act was also notconsidered with reference to the grounds raised by thepetitioner and based on some irrelevant consideration, the saidapplication was rejected. 6. The learned counsel for the petitioner contended that,the representations submitted by the petitioner on severaloccasions are not considered and therefore, the impugned orderis in violation of Section 220(2A) of the Income Tax Act. Thepetitioner furnished all the materials and relevant documents toestablish that he is not responsible for the delay and he hadco-operated for the completion of the assessment proceedings.This apart, the petitioner paid the tax as demanded in time bysubmitting the returns of income punctually and therefore, he isentitled for waiver of interest as contemplated under Section220(2A) of the Act. 7. The learned counsel for the petitioner drawn theattention of this Court with reference to variousrepresentations submitted by the writ petitioner. Therepresentations were submitted on 23.05.2017, 05.09.2017 and18.09.2017 respectively seeking waiver of interest under Section220(2) of the Income Tax Act. However, the first respondentconsidered the first representation dated 23.05.2017 andsubsequent representations sent by the petitioner were notconsidered. Thus, non-consideration of the grounds raised by thepetitioner would vitiate the entire order and the matter has tobe remitted back to the authority for fresh consideration of allthe materials submitted by the writ petitioner. 8. The learned counsel appearing on behalf of the writpetitioner is of the opinion that, the writ on hand is the fitcase for remand, in view of the fact that, the authority has notexercised jurisdiction as contemplated under the provisions ofthe Act. The non-consideration of the relevant materialsfurnished through representations deprived the petitioner fromavailing the benefit of waiver of interest under Section 220(2A)of the Income Tax Act. 8. The learned counsel appearing on behalf of the writpetitioner is of the opinion that, the writ on hand is the fitcase for remand, in view of the fact that, the authority has notexercised jurisdiction as contemplated under the provisions ofthe Act. The non-consideration of the relevant materialsfurnished through representations deprived the petitioner fromavailing the benefit of waiver of interest under Section 220(2A)of the Income Tax Act. 9. The learned counsel appearing for the petitionersolicited the attention of this Court regarding the assessmentorders passed with reference to the assessment years 2007-08 and2008-09. In those two assessment orders, there is no whisperabout the non-cooperation of the petitioner for completion ofthe assessment proceedings. Thus, the reasons for rejection ofapplication in the impugned order that the petitioner had notco-operated for completion of assessment is factually incorrectand it is nothing but the imagination of the first respondentwhen the assessment order did not speak anything about any suchnon-cooperation on the part of the assessee and the groundsinvented for rejection of application deserves to be set aside. 10. The learned counsel for the petitioner pointed out thatthe details regarding the return of Income Tax paid punctuallyby the petitioner and the refund for which, the petitioner isentitled, were repeatedly claimed by way of representations. Thepetitioner has sought for adjustment of refund due to him andsuch a request was also not considered by the respondents. 11. The relevant application for the purpose of grant ofwaiver of interest was filed at the first instance by thepetitioner on 23.05.2017 through his authorized ChartedAccountants. In the said application also the petitioner made arequest that Assessing Officer has to adjust the refund to thetax demand for the assessment years 2007-08 and 2008-09. It isspecifically stated in the said application that the assesseehas fully co-operated during the appellate proceedings andfurther provided all the necessary details as required by theAssessing Officer. In the second representation dated 05.09.2017it is stated that he has furnished all the details for thepurpose of considering the waiver petition initially filed on23.05.2017. Even in the second representation, the petitionerhas stated that the assessee had to refund due for some of theyears and there was demand payable by the assessee for otheryears. Vide submission dated 04.03.2014 and 06.02.2015, theassessee made clear the position to the Assessing Officer thatthe total refund due to the assessee was more than the demands payable. The status of demands and refunds for respective yearswere also categorically furnished by the assessee in the saidrepresentation dated 05.09.2017. In the next representationdated 18.09.2017 also, the petitioner has reiterated the saidfactual position and requested to grant waiver of interest.However, none of the grounds raised by the petitioner wereconsidered and the rejection order is passed in an unilateralmanner and thus, the Writ Petition has to be considered. 12. The learned counsel for the petitioner in support of hiscontentions relied on the judgment in the case of B.M.Malani vs.Commissioner of Income Tax and another reported in (2008) 10 SCC617. The following paragraphs are as follows: payable. The status of demands and refunds for respective yearswere also categorically furnished by the assessee in the saidrepresentation dated 05.09.2017. In the next representationdated 18.09.2017 also, the petitioner has reiterated the saidfactual position and requested to grant waiver of interest.However, none of the grounds raised by the petitioner wereconsidered and the rejection order is passed in an unilateralmanner and thus, the Writ Petition has to be considered. 12. The learned counsel for the petitioner in support of hiscontentions relied on the judgment in the case of B.M.Malani vs.Commissioner of Income Tax and another reported in (2008) 10 SCC617. The following paragraphs are as follows: "14. The submission of Mr.Varma is that non-enchashment of demand draft worth Rs.10 Lakhs asalso non-selling of the shares and securities asprayed for by the appellant caused genuine hardshipto the assessee, in support where of reliance hasbeen placed on the New Collins Concise EnglishDictionary; Words and Phrases, Permanent Edn.,Vol.18 and Black's Law Dictionary. It wasfurthermore submitted that had the shares andsecurities been sold when the request therefor wasmade, which was worth Rs.30 Lakhs at the relevanttime, the tax burden of the appellant would havebeen reduced; particularly when after adjusting theamount of Rs.117.04 Lakhs deposited by theappellant, only a sum of Rs.40.73 Lakhs remaineddue. . . . . . 16. The term "genuine" as per the New CollinsConcise English Dictionary is defined as under: " 'Genuine' means not fake or counterfeit,real, not pretending (not bogus or merely a ruse)". 17. For interpretation of the aforementionedprovision, the principle of purposive constructionshould be restored to. Levy of interest although isstatutory in nature, inter alia, for re-compensatingthe Revenue from loss suffered by non-deposit of taxby the assessee within the time specified therefor.The said principle should also be applied for thepurpose of determining as to whether any hardshiphad been caused or not. A genuine hardship would,inter alia, mean a genuine difficulty. That per sewould not lead to a conclusion that a person havinglarge assets would never be in difficulty as he cansell those assets and pay the amount of interestlevied. 18. The ingredients of genuine hardship mustbe determined keeping in view the dictionary meaningthereof and the legal conspectus attending thereto.For the said purpose, another well-known principle,namely, a person cannot take advantage of his ownwrong, may also have to be borne in mind. The saidprinciple, it is conceded, has not been applied bythe Courts below in this case, but we may take noteof a few precedents operating in the field tohighlight the aforementioned proposition of law.[See Priyanka Overseas (P) Ltd. v. Union of India(SCC at pp.122-23, para 39); Union of India v. MajorGenral Madan Lal Yadav (Retd) (SCC at p.142, paras28-29); Ashok Kapil v. Sana Ullah (SCC at p.345,para 7); Sushil Kumar v. Rakesh Kumar (SCC at p.692,para 65 first sentence); Kusheshwar Prasad Singh v.State of Bihar (SCC at pp.451-52, paras 13-14 and16)]. 19. Thus, the said principle, in our opinion,should be applied even in a case of this nature. Astatutory authority despite receipt of such arequest could (sic not) have kept mum. It shouldhave taken some action. It should have responded tothe prayer of the appellant. However, anotherprinciple should also be borne in mind, namely, thata statutory authority must act within the fourcorners of the statue. Indisputably, theCommissioner has the discretion not to accede to therequest of the assessee, but that discretion must bejudiciously exercised. He has to arrive at asatisfaction that the three conditions laid downtherein have been fulfilled before passing an orderwaiving interest. 19. Thus, the said principle, in our opinion,should be applied even in a case of this nature. Astatutory authority despite receipt of such arequest could (sic not) have kept mum. It shouldhave taken some action. It should have responded tothe prayer of the appellant. However, anotherprinciple should also be borne in mind, namely, thata statutory authority must act within the fourcorners of the statue. Indisputably, theCommissioner has the discretion not to accede to therequest of the assessee, but that discretion must bejudiciously exercised. He has to arrive at asatisfaction that the three conditions laid downtherein have been fulfilled before passing an orderwaiving interest. 20. Compulsion to pay any unjust dues per sewould cause hardship. But a question, however, wouldfurther arise as to whether the default in paymentof the amount was due to circumstances beyond thecontrol of the assessee."13. Relying on the said findings of the Apex Court, thelearned counsel appearing for the petitioner reiterated that thewaiver of interest in the present case ought to have beenallowed by the first respondent. The Supreme Court in clearterms held that, genuine hardship would, inter alia, mean agenuine difficulty. Thus mere possession of assets larger innature would never be a ground to reject the ground ofdifficulty raised by the assessee in respect of other instances.It is further considered that compulsion to pay any unjust duesper se would cause hardship to the assessee. In the presentcase, the petitioner is asked to pay the interest in an unjustmanner and therefore, the same would cause hardship to the petitioner assessee and thus, he is entitled for the waiver ofinterest. 14. The learned counsel appearing for the petitioner furtherrelied on the judgment in the case of Auro Food Limited vs.Commissioner of Income Tax and others reported inMANU/TN/1701/2004, which reads thus: "As rightly pointed out by the learned counsel forthe appellant, though necessary details, such asconditions to be satisfied, the grievances expressed bythe assessee, etc., have been stated, the authority; whois exercising his quasi-judicial function has notconsidered each grievance and answered separately bygiving adequate reason for rejecting the petitioner forwaiver of interest. In this regard learned counsel for theappellant very much relied on the decision of the ApexCourt in the case of Kishan Lal v. UOI MANU/SC/2145/1998 :[1998]230ITR85(SC). There also, in order to avoid levy ofinterest, an application under sub-section (2A) of section220 of the Act was filed before the CBDT. The Board hasrejected the said application by giving the followingreason." 15. In the case of J.Jayalalitha vs. Commissioner of IncomeTax, the learned Single Judge of the Hon'ble High Court ofMadras passed an order on 30.09.1999 remitting the matter backto the authorities for reconsideration in respect ofapplications filed seeking waiver of interest under Section 220(2) of the Income Tax Act. The findings made in the said case isthat, the Commissioner has not taken into considerationrelevant circumstances, but has taken into considerationirrelevant circumstances while rejecting the applications filedby the assessee. Thus, the matter was remitted back for freshconsideration. 15. In the case of J.Jayalalitha vs. Commissioner of IncomeTax, the learned Single Judge of the Hon'ble High Court ofMadras passed an order on 30.09.1999 remitting the matter backto the authorities for reconsideration in respect ofapplications filed seeking waiver of interest under Section 220(2) of the Income Tax Act. The findings made in the said case isthat, the Commissioner has not taken into considerationrelevant circumstances, but has taken into considerationirrelevant circumstances while rejecting the applications filedby the assessee. Thus, the matter was remitted back for freshconsideration. 16. The learned Senior Standing counsel replied by statingthat, those judgments are inapplicable, as far as the details ofthe petitioner is concerned. None of the three conditionsstipulated under Section 220(2A) of the Income Tax Act arecomplied with. The non-compliance of the conditions resulted inrejection of applications by the first respondent and there isno infirmity as such. It is further contended that thepetitioner has not satisfied all the three grounds which are allmandatory under the said provision and it is not as if onecondition alone is to be complied with. All the three conditionshave to be complied with cumulatively for availing the benefitof waiver of interest and not otherwise. Thus, the judgmentscited are of no avail to the petitioner. 17. The learned Senior Standing counsel appearing on behalfof the respondents Income Tax Department disputed thecontentions raised on behalf of the petitioner by stating that,the case of the petitioner is not the one where regularassessment order has been passed. There was a search operationconducted in the premises of the petitioner. Admittedly, basedon the search and seizure under Section 132 of the Income TaxAct, the assessment orders were passed under Section 153A of theIncome Tax Act as the petitioner is a searched person. Thepetitioner initially had not paid the demand made by thedepartment. There was non-cooperation on the part of theassessee in the present case. Even in such circumstances, thepetitioner had no intention to pay the interest based on thedemand made under Section 156 of the Act which was communicatedalong with the assessment order and thereafter, claimed waiverof interest by filing an appropriate application under Section220(2A) of the Income Tax Act. 18. The learned Senior Standing counsel reiterated that insuch cases where demand of interest is made along with theassessment order then the assessee is bound to pay the interestand thereafter, he is at liberty to file an application beforethe Competent Authority for waiver of interest and this beingthe procedures to be followed, it is not necessary that thedepartment should wait for the finality to be reached in thelitigation initiated by the parties for the purpose of claiminginterest under Section 220(2) of the Act. 18. The learned Senior Standing counsel reiterated that insuch cases where demand of interest is made along with theassessment order then the assessee is bound to pay the interestand thereafter, he is at liberty to file an application beforethe Competent Authority for waiver of interest and this beingthe procedures to be followed, it is not necessary that thedepartment should wait for the finality to be reached in thelitigation initiated by the parties for the purpose of claiminginterest under Section 220(2) of the Act. 19. The interest charged under Section 220(2) of the Act isnot a penalty and it is only in the nature of compensation.Therefore, the simple interest has been charged. The interestunder Section 220(2) of the Act being compensatory in nature,the assessee in all circumstances is bound to pay and if anydifficulty arises, then he is at liberty to file an application.However, in the present case, the assessment orders were passedin the year 2011 and the application seeking waiver of interestwas filed by the petitioner assessee only during the year 2017.Even in the other circumstances, the petitioner ought to havepaid the tax as per the demand and claimed the waiver ofinterest. Once the tax demand was not complied with, thedepartment is entitled to claim interest under Section 220(2) ofthe Income Tax Act. Therefore, the learned Senior Standingcounsel made a submission that the petitioner assessee wouldhave to either paid the demanded tax within the period ascontemplated or paid the interest at the time on demand andthereafter submit a waiver petition to avail the benefit underSection 220(2) of the Act. 20. The learned Senior Standing counsel referred theassessment order dated 30.12.2011 for the assessment year 2007-08 and has stated that, it was issued in the year 2011 andtherefore, the petitioner would have paid the tax without anydelay as per the provisions of the Act. Taking the issues by wayof an appeal before the Appellate Authority and thereafter tothe Tribunal or to the Court of law, would not preclude thedepartment from charging interest, which is compensatory innature under Section 220(2A) of the Income Tax Act. Therefore,the delay cannot be attributed against the respondentsdepartment, but it is due to the non-payment of demanded tax intime. The petitioner is now bound to pay the interest ascompensation. Therefore, the petition is devoid of merits and isto be rejected. 21. Considering the arguments as advanced by the respectivelearned counsel appearing on behalf of the petitioner as well asthe learned Senior Standing counsel appearing on behalf of therespondents, it is necessary to consider the scope of Section220 of the Income Tax Act. The said section deals, when taxpayable and when assessee deemed in default. If the assesseeconsidered as deemed in default, then he is liable to pay thecompensatory interest as specified under sub-section (2) ofSection 220. 22. Section 220 sub-section (1) states that "any amount,otherwise than by way of advance tax, specified as payable in anotice of demand under Section 156 shall be paid within thirtydays of the service of the notice at the place and to the personmentioned in the notice". Therefore any amount of advance taxspecified payable or on tax demand is made, the same is to bemade within thirty days. If not paid, then sub-section (2) of220 of the Act come into operation. The sub-section(2)contemplates that "if the amount specified in any notice ofdemand under Section 156 is not paid within the period limitedunder sub-section (1), the assessee shall be liable to paysimple interest at 1% for every month or part of a monthcomprised in the period commencing from the day immediatelyfollowing the end of the period mentioned in sub-section (1) andending with the day on which the amount is paid". 23. Therefore, sub-section (2) does not contemplate anypenalty for belated payment. But, it is the compensatoryinterest in nature and interest of 1% for every month iscontemplated. Such compensatory interest is prescribed in orderto make good the financial loss occurred to the revenue onaccount of delay in payment on advance tax or tax on demand. Therefore, the said provision cannot be compared with thepenalty clause. 24. The sub-section 2A of Section 220 reads thus: "(2A) Notwithstanding anything contained insub-section (2), [the [Chief Commissioner orCommissioner] may] reduce or waive the amount ofinterest [paid or] payable by an assessee underthe said sub-section if [he is satisfied] that-(i) payment of such amount [has caused or]would cause genuine hardship to the assessee ; (ii) default in the payment of the amount onwhich interest [has been paid or] was payableunder the said sub-section was due tocircumstances beyond the control of theassessee ; and(iii) the assessee has co-operated in anyinquiry relating to the assessment or anyproceeding for the recovery of any amount duefrom him.]" 25. The above provision would unambiguously clarifies thePrincipal, Chief Commissioner or Chief Commissioner or PrincipalCommissioner or Commissioner may reduce or waive the amount ofinterest paid or payable by an assessee under the said sub-section, if he is satisfied with the three conditions stipulatedin sub-section 2A. Thus, the Principal Commissioner is atdiscretion to reduce or waive the amount of interest paid orpayable by the assessee. It impliedly indicates that even incase the assessee paid the interest under sub-section 2 of 220,he is entitled to claim waiver of interest by filing anapplication under Section 220(2A) of the Act and if not paid,then also he is eligible to submit an application for waiver.However, the discretion is to be exercised by the PrincipalCommissioner if he is satisfied regarding the three componentsspecifically contemplated under sub-section 2A of the Act. 26. Three conditions are stipulated under the provisions forpayment of waiver of interest and all the three conditions areto be fulfilled cumulatively. The genunity of the hardship isthe subjective satisfaction to be adjudicated and assessed bythe Competent Authority under the said provision. The secondcondition that default in payment of tax, due to circumstancesbeyond the control of the assessee is also to be establishedwith reference to evidences. The evidences must be not onlyacceptable but must have nexus with reference to the conditionsstipulated in the provision. Thirdly, co-operation of theassessee during the course of enquiry relating to the assessmentor any proceedings for recording any amount due from the assesse, the records are to be verified and assessee if hadsufficient reasons are at liberty to revert the same. However,the non-cooperation is to be considered with reference to theconduct of the assessee during the course of any proceedingsunder the Income Tax Act. Thus, all the three conditionscontemplated under the said provisions are to be complied withcumulatively. assesse, the records are to be verified and assessee if hadsufficient reasons are at liberty to revert the same. However,the non-cooperation is to be considered with reference to theconduct of the assessee during the course of any proceedingsunder the Income Tax Act. Thus, all the three conditionscontemplated under the said provisions are to be complied withcumulatively. 27. Keeping in mind the imperative conditions stipulatedunder Section 220(2A) of the Act, let us consider the findingsof the first respondent in the impugned order dated 31.05.2018.The application filed by the petitioner under Section 220(2A) ofthe Income Tax Act was entertained and for adjudication. Oncethe application is entertained, the Authority Competent is boundto consider the grounds raised. Perusal of the order wouldreveal that the Competent Authority has considered theassessee's petition and the case records as well. Onverification of the case records, the first respondent CompetentAuthority found that the assessee has never paid the demands intime for both assessment years, i.e., 2007-08 and 2008-09. Thedetails of demand raised but not paid have been furnished in theimpugned order are extracted hereunder: A.Y2007-08 2008-09Demandraised Demand raisedbut not paidbut not paid 143(3)2,08,15,2981,03,80,948r.w.s.153Adated 30.12.2011154 Order dated12,51,85401.03.2012(basedonassesseepetition)OrderGiving32,00,0221,56,22,934effect to CIT(A)OrderOrderGiving1,37,58,848effect to ITATOrder154 Order dated40,93,103 54,32,31129.03.2017(basedonassesseepetition) 28. The first respondent Competent Authority was consciousabout the three mandatory conditions stipulated under the Actand the records indicate the same. Firstly, he has stated thatthe assessee has not specified any reason that payment of theinterest would cause any genuine hardship. However, the judgmentsubmitted on behalf of the petitioner in the case of ShriB.M.Malani vs. CIT was taken into consideration for the purposeof considering the case of the writ petitioner. The firstrespondent formed an opinion that the petitioner has notestablished any genuine hardship and not paid the taxes withintime by making wrong claims. The observation made in theimpugned order would reveal that the assessee has not furnishedany reasons that default in the payment of interest was beyondthe control of the assessee. When the assessment proceedings forboth the assessment years 2007-08 and 2009-10 were completed on30.12.2011, it is not clear why the assessee has not paid thesedemands. At least the assessee would have paid these demandsafter giving effect to CIT(A) dated 27.09.2013. 29. The findings would further reveal that the assessee hasnot co-operated in completion of the assessment for thefollowing reasons: "Consequent to search, notice u/s153A ofthe IT Act was issued on 09.03.2011 calling forreturn of income within 45 days of the receiptof the notice (i.e., on or before 24.04.2011),but the assessee furnished the return of incomeonly on 15.07.2011. The assessee's explanationwas only that records could not be recoveredfrom the accountant. However the assessee couldnot substantiate the claim with any proof.Again notice u/s 143(2) was issued on09.09.2011 posting the case on 16.09.2011.Again notice u/s 142(1) of the IT Act wasissued on 19.09.2011 posting the case forhearing on 28.09.2011. In response theassessee's AR appeared only on 03.10.2011.Again the case was posted on 10.11.2011. Inresponse the AR appeared only on 05.12.2011.Further with regard to A.Y. 2007-08, mostof the additions made by the Assessing Officerwere upheld both by the CIT(A) and ITAT also.Hence it is clear that the assessee has notfurnished the full details of the income evenafter search." 30. The first respondent further made a findings withreference to the assessment years 2008-09 as follows: 30. The first respondent further made a findings withreference to the assessment years 2008-09 as follows: "Further with regard to A.Y. 2008-09, whilegiving effect to the ITAT order on 25.07.2014,there was an omission by the Assessing Officerwhich was not brought to the notice by theAssessing Officer which was rectified only on29.03.2017. Hence it is clear that the assesseehas not furnished the full details of the incomeeven after search. Also I have gone through the letter dated05.02.2014 filed by the assessee in this officewherein he claimed that he is eligible for arefund of Rs.2,07,51,098/- for the A.Y. 2011-12.But at that time the assessment proceedings forthe A.Y.2011-12 was not completed and hence thequestion of issuing refund may not arise at thatpoint of time." 31. The authority competent relied on the principles forwaiver of interest as laid down by the decision of the Hon'bleHight Court of Delhi vide its order in WP(C) No. 5750 of 2010dated 05.01.2012 in connection with writ filed by the GirnarInvestment Limited, which reads thus: "(a) fresh notices of demand need not beissued every time the total income undergoes achange due to appellate or provisional orderssince section 3(b)(iii) of the validating Actprovides that any proceeding initiated on thebasis of the notice of demand served upon theassessee before the disposal of the appeal orother proceeding may be continued in relation tothat amount so reduced from the stage at whichsuch proceedings stood immediately before suchdisposal; (b) a case where the assessee has paid thefull amount of tax demanded by the AO pursuant tothe assessment order stands on a differentfooting from a case where such demand was notsatisfied in full and different considerationsshall apply to such a case; (c) the original demand made by the AO onthe basis of the assessment order is merely keptin abeyance or suspension during the entireproceedings by way of appeal or revision takenagainst the assessment and gets revived frominception once the assessment gets finallyconfirmed in those proceedings;(d) when the assessment order is finallyaffirmed, the doctrine of merger also applies andinterest being compensatory in nature, therevenue is entitled to charge the same from the date of the original order which merged with thefinal appellate order;(e) as a corollary to the above, it followsthat where an assessment is restored and theoriginal demand gets revived from inception, theassessee is liable to pay interest u/s.220(2) ofthe Act from that date on the unpaid amount andany variation in the amount of the demandfavorable to the assessee which was directed byany of the appellate authorities in theinterregnum has no effect on the liability of theassessee to pay the interest." date of the original order which merged with thefinal appellate order;(e) as a corollary to the above, it followsthat where an assessment is restored and theoriginal demand gets revived from inception, theassessee is liable to pay interest u/s.220(2) ofthe Act from that date on the unpaid amount andany variation in the amount of the demandfavorable to the assessee which was directed byany of the appellate authorities in theinterregnum has no effect on the liability of theassessee to pay the interest." 32. As far as the judgment cited by the learned counsel forthe petitioner in the case of B.M.Malani cited supra, theHon'ble Apex Court in clear terms held that, the genuinehardship would mean genuine difficulty which is to beestablished. In this regard, the learned counsel for thepetitioner reiterated that mere possession of assests by theassessee cannot be a disqualification to consider the ground ofgenuine difficulty. Certainly, the learned counsel for thepetitioner is right in saying so. However, the genuinedifficulty as defined is the subjective satisfaction of theauthority competent, which is to be established by the assessee.Therefore, there is no quarrel on the principles relied on.However, such principles must be applied with reference to thefacts and circumstances established in the case on hand. TheHon'ble Apex Court ruled that as per the provisions all thethree conditions are to be complied cumulatively for thepurpose of entitlement of waiver of interest. In the presentcase, the first respondent / Commissioner considered thepetition filed by the assessee with reference to the records /documents. The findings are made based on the records availableand the said findings would reveal that, the petitioner assesseehad not paid the demands for both the assessment years. Thedetails of non payments were also furnished in the impugnedorder. The contention of the petitioner that, the originalAssessing Officer has not stated anything about thenon-cooperation in the assessment order deserves no meritconsideration. The Assessing Officer while passing the originalassessment order need not record any such non-cooperation as theassessment order was not an ex-parte order. Only when anapplication is filed seeking waiver of interest, then thequestion arises, whether the assessee co-operated for completionof the income tax proceedings or not. Since for claiming waiverof interest co-operation is contemplated as a condition.Therefore, it is necessitated for the parties, whileadjudicating the petition filed by the assessee seeking waiverof interest. Thus, the conduct of the assessee throughout the income tax proceedings are vital for the purpose of claimingwaiver of interest. The respondents in the present case recordedthe non-cooperation of the petitioner assessee. The observationsmade in this regard would establish that consequent to searchnotice under Section 153A of the Income Tax Act dated 09.03.2011calling for return of income within 45 days of the receipt ofthe notice. But the assessee furnished the return of income onlyon 15.07.2011. The other incidents are also recorded toestablish that the petitioner assessee had not co-operated forthe completion of the Income Tax proceedings. This being thefactum established, this Court has no hesitation in arriving ata conclusion that the petitioner has not established all thethree conditions stipulated in the provisions for the purpose ofgrant of waiver of interest. Contrarily, the reasons furnishedin the impugned order for rejection of application for waiver ofinterest are candid and convincing. 33. Thus, the Writ Petition fails and stands dismissed.However, there shall be no order as to costs. Sd/- Assistant Registrar(CS VI) //True Copy// vji Sub Assistant Registrar To 33. Thus, the Writ Petition fails and stands dismissed.However, there shall be no order as to costs. Sd/- Assistant Registrar(CS VI) //True Copy// vji Sub Assistant Registrar To 1. The Principal Commissioner of Income TaxCentral 2,Nungambakkam,Chennai - 34.2. The Deputy Commissioner of Income TaxCentral Circle - II(4),New No.46, M.G.Road,Nungambakkam, Chennai - 34. 3. The Assistant Commissioner of Income TaxCentral Circle - II(5),New No.46, M.G.Road,Nungambakkam, Chennai - 34. 4. The Assistant Commissioner of Income TaxCentral Circle - II(4),New No.46, M.G.Road,Nungambakkam, Chennai – 34.+1CC to Mr.S.Raveekumar, Advocate, Sr.No.38270+1CC to Mr.A.P.Srinivas, Advocate, Sr.No.38115 W.P.No.31785 of 2018 KSM (CO)K.RK. (15.09.2021)