2010 (11) TMI 963 - AT - Income Tax

Summary

Issues involved: Appeal against order of CIT(A)-10, Mumbai allowing interest u/s 244A for refund arising from self assessment tax.

Summary:

Issue 1: Interpretation of section 244A for interest on self assessment tax refund
The appeal was filed by the revenue against the order of CIT(A)-10, Mumbai allowing interest u/s 244A for a refund arising from self assessment tax. The assessee, a company from Mauritius engaged in broadcasting outside India, had filed a revised return declaring income. The Assessing Officer (AO) directed interest u/s 234A to be charged. The ITAT allowed the appeal in favor of the assessee, leading to a refund arising from self assessment tax payment. The AO, however, denied interest u/s 244A for this refund. The assessee contended that self assessment tax falls under section 244A(1)(b) for interest calculation. The CIT(A) agreed, citing relevant case laws and directed the AO to allow interest u/s 244A in accordance with the law.

Issue 2: Compliance with statutory provisions and case laws
On perusal of section 244A(1), it was found that self assessment tax payment is covered by clause (b) for interest calculation. Case laws and CBDT Circular No. 549 supported the assessee's entitlement to interest on such refunds. The CIT(A) considered all statutory requirements and directed the AO to allow interest u/s 244A. The Tribunal upheld the CIT(A)'s order, dismissing the revenue's appeal.

In conclusion, the Tribunal upheld the CIT(A)'s decision to allow interest u/s 244A for a refund arising from self assessment tax payment, based on statutory provisions and relevant case laws, thereby dismissing the revenue's appeal.