2024 (9) TMI 204 - AT - Income Tax

Non granting interest u/s 244A - delay in filing the revised return by the assessee - HELD THAT - No delay was attributable on the part of the assessee after filing of its revised return on 16.10.2017. The delay if any was on the part of the CPC and the Jurisdictional AO in not giving credit to advance tax and TDS of the assessee to Torrent Power Ltd. It is also relevant to consider that due to non-credit of advance tax and TDS in the case of Torrent Power Ltd. demand was raised in the case of Torrent Power Limited which was liable for payment along with the interest. Thus when the Revenue is collecting the demand along with the interest due to non-credit of advance tax and TDS of the assessee in the hands of TPL and denying interest u/s. 244A of the Act to the assessee is highly arbitrary. Revenue is equally liable to pay interest on the amount of refund being issued to the assessee. Accordingly the Revenue is directed to grant interest u/s. 244A of the Act to the assessee from the date of filing of the revised return till the date of issue of refund. Appeal preferred by the assessee is allowed.

Summary

Issues:
Delay in filing appeal, Granting interest under Section 244A of the Income Tax Act, 1961.

Analysis:
The appeal was filed by the assessee against the order of the National Faceless Appeal Centre for the Assessment Year 2016-17, with a delay of 95 days. The reason for the delay was explained by the assessee, stating that the appeal order was received by authorized persons via email but not brought to the company's notice on time. The Revenue did not object to the condonation of the delay, leading to the delay being condoned.

The only ground taken by the assessee in the appeal was regarding the refusal to grant interest under Section 244A of the Income Tax Act, 1961. The case involved the transfer of Solar & Wind Energy undertaking to another company, leading to a revised return and subsequent refund issues. The AO had allowed the refund but denied interest under Section 244A, attributing the delay to the assessee.

During the appeal, the assessee argued that the delay was not on their part but due to the Revenue's actions. The Revenue contended that since no refund was claimed in the revised return, interest under Section 244A was not applicable. The Tribunal examined the facts and found that the delay was due to the CPC and Jurisdictional AO's failure to credit advance tax and TDS to the new company. As a result, the Tribunal directed the Revenue to grant interest under Section 244A to the assessee from the date of filing the revised return.

In conclusion, the Tribunal allowed the appeal by the assessee, emphasizing that the delay in granting interest under Section 244A was not the assessee's fault but a result of the Revenue's actions. The Tribunal directed the Revenue to pay interest to the assessee from the date of filing the revised return till the date of the refund issuance.