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2013 (5) TMI 22 - HC - Income TaxInterest under Section 244A denied - MAT credit under Section 115JA - AO found that the claim for MAT credit can be considered only after charging the surcharge on Income Tax - whether surcharge should have been calculated after deducting MAT credit and interest under Section 244A should have been granted - AO also given credit to TDS and accordingly ordered for refund - Held that - As decided in Commissioner of Income Tax Vs. Tulsyan NEC Ltd. (2010 (12) TMI 23 - Supreme Court of India) MAT credit admissible in terms of section 115JAA has to be set off against the assessed tax payable, before calculating interest under Sections 234A, 234B and 234C. It is further held therein that if an assessee is entitled to a tax credit as a consequence of the assessee making payment of tax under Section 115JA(1) in year one, then, the set off such tax credit follows as a matter of course once the conditions mentioned under Section 115JAA are fulfilled and the grant of such credit is not dependent upon determination by the Assessing Officer. Thus, the Apex Court decided the issue in favour of the assessee therein. Also see Commissioner of Income Tax Vs. Chemplast Sanmar Ltd (2009 (4) TMI 61 - MADRAS HIGH COURT) It appears that the Tribunal had concentrated only on the issue as to whether giving credit for MAT before set off of TDS and advance tax from the tax payable by the assessee is correct or not. The Tribunal adverted its attention to the Chemplast Sanmar Ltd., case to answer the said issue and consequently rejected the Revenue s appeal. The grounds of appeal raised in this appeal by the Revenue also indicate that the issue before the Tribunal was only with regard to interest payable under Section 244A and not with regard to the adjustment of MAT credit - no merits in this appeal and accordingly reject the same by answering the question of law accordingly.
Issues:
Appeal against Income Tax Appellate Tribunal order for assessment year 2001-2002; Entitlement to interest under Section 244A. Analysis: The appeal before the Madras High Court involved a dispute regarding the entitlement to interest under Section 244A following an order of the Income Tax Appellate Tribunal for the assessment year 2001-2002. The Assessing Officer had completed the assessment under Section 143(1) of the Income Tax Act, granting MAT credit and TDS credit, resulting in a refund to the assessee. The dispute centered around whether the refund was solely due to the MAT credit or also the TDS credit, impacting the eligibility for interest under Section 244A. The first appellate authority rejected the claim that surcharge should be calculated after deducting MAT credit but directed the Assessing Officer to calculate and grant interest under Section 244A. The Revenue appealed to the Tribunal, which dismissed the appeal, citing a previous decision. The Tribunal focused on the issue of giving MAT credit before set off of TDS and advance tax, without detailed discussion on interest payments under Section 244A. The High Court observed that the issue of MAT credit had been settled by the Supreme Court and the Tribunal's focus was on the adjustment of MAT credit rather than interest under Section 244A. Despite the lack of detailed discussion by the Tribunal on interest payments, the High Court found that the refund arose not solely due to MAT credit but also the excess TDS payment, entitling the assessee to interest under Section 244A. Consequently, the High Court rejected the appeal, affirming the direction to grant interest under Section 244A, without remitting the matter back to the Tribunal. In conclusion, the High Court found no merit in the appeal, as the refund was not solely due to MAT credit, and upheld the entitlement to interest under Section 244A as directed by the first appellate authority. The dismissal of the appeal was deemed sufficient to resolve the matter, with no costs awarded.
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