2013 (11) TMI 147 - AT - Income Tax

Interest on excess tax collected Held that - In case of order u/s 143 interest has to be paid from the date of payment of tax to the date on which the refund is granted - If there is delay in the proceedings for reasons attributable to the assessee, the period of such delay should be excluded - The proceedings before the Assessing Officer, the learned Commissioner of Income-tax (Appeals) and the Income-tax Appellate Tribunal is a continuous process - the assessment proceedings didn t got delayed due to the assessee s failure to submit the details before the authorities interest allowed from the date of payment of tax - Decided in favour of assessee.

Summary

Issues:
- Appeal against the non-allowance of interest on excess tax collected from the date of payment to the date of the Income-tax Appellate Tribunal order.

Analysis:
The case involved appeals against the denial of interest on excess tax collected by the assessee. The Assessing Officer had rejected the assessee's claim for interest under section 244A, citing delays attributable to the assessee in producing original documents. The Commissioner of Income-tax (Appeals) upheld this decision, stating that the delay was due to the assessee's failure to substantiate claims during assessment and appellate proceedings. However, the Tribunal set aside the order, noting that the delay in completing the assessment could not be attributed to the assessee. The Commissioner directed the Assessing Officer to allow interest on the excess tax paid by the assessee. The assessee appealed, seeking interest from the date of payment to the Tribunal order.

The Tribunal referred to section 244A, which mandates interest payment on refunds from the date of tax payment to refund grant date. It highlighted that delays attributable to the assessee should be excluded from the interest period. In this case, the assessment proceedings were prolonged, but the delay cause was not clearly established as the continuous process involved multiple authorities. The Tribunal concluded that the assessee should be granted interest from the date of tax payment to the Tribunal order date. Both appeals by the assessee were allowed, overturning the previous decisions.

In summary, the Tribunal emphasized the continuous nature of assessment proceedings involving various authorities and the lack of clear evidence attributing delays to the assessee. Consequently, interest on the excess tax collected was granted from the date of payment to the Income-tax Appellate Tribunal order date, as per the provisions of section 244A.