The assessee sought for credit in respect of the advance tax remitted during the financial years 2011-12 and 2012-13, relevant to the assessment years 2012-13 and 2013-14 and there was a delay of one and two years, respectively, since the amounts for which credit was sought for ought to have been remitted in the financial year 2010-11, relevant to the assessment year 2011-12. To such extent, the assessee was liable to interest under section 234B. The order rejecting waiver of interest was set aside to that extent. There was no justification in the challenge to the order of the Commissioner (Appeals) and the consequential order passed by the Assessing Officer. Court also held that  the contents of a notification issued by the Central Board of Direct Taxes could not limit the interpretation of statutory provisions. Notification F. No. 400/234/95-IT(B), dated May 23, 1996 ([1997] 225 ITR (St.) 101), wherein “Capital gains” had been excluded under clause (c) as a head of income, from the ambit of waiver was not relevant to the assessee and therefore, reliance upon it was misplaced. The situation contemplated in clause (c) was one where income chargeable under a head other than “Capital gains”, was received or had accrued after the due date of payments of the first or second instalments of advance tax and such a situation did not arise in the assessee’s case since the entire consideration had not just been received but also offered to tax in the respective assessment years. The advance taxes relevant to the assessment years 2012-13 and 2013-14 had been paid in time, in the course of financial years 2011-12 and 2012-13, respectively. The reassessments had transpired on December 29, 2017. The payments were not ad hoc, and had been made specifically towards advance tax for liability towards capital gains in the financial years 2011-12 and 2012-13. Moreover, the Department had been in possession of the entire amounts from the financial years 2011-12 and 2012-13, since the assessee had satisfied the demands for the corresponding assessment years by way of advance and self-assessment taxes. It was those amounts that had been adjusted against the liability for the assessment year 2011-12 and therefore, substantially revenue neutral. The phrase “or otherwise” used in section 234B(2) would encompass situations of remittances made in any other context, wherein the amounts paid stood to the credit of the assessee. However, the liability to advance tax had commenced from the financial year relevant to the assessment year in question 2011-12.

(AY.2011-12, 2012-13, 2013-14)