Consequential refund well in time to avoid payment of interest. - Income Tax - 350/CBDT

INSTRUCTION NO. 350/CBDT Dated: December 4, 1971 Section(s) Referred: 244 Statute: Income - Tax Act, 1961 Reference is invited to para 2 of the boards circular NO.20(LXXVI-42)D of 1962 dated 18-7-62, emphasising the need for prompt issue of refund due inter alia as a result of appellate orders, so that the government did not have to pay interest for delays beyond the specified period. Sec.244 of I.T.Act has been amended by the Taxation Laws(Amendment Act), 1970 to provide that w.e.f 1-4-71, interest payable by Government on delayed refunds consequent on appellate orders, will be payable after a period of 3 months from the end of the month in which the relevant order is passed. Before the amendment such interest was payable after a period of 6 months from the date of the relevant appellate order. Having regard to the reduction of interest-free period from 6 months to 3 months from 1-4-71 it was urged in the explanatory notes on the provisions of the Taxation laws Act, 1970 vide para 26 thereof that expeditious disposal was called for in order to ensure that refunds were granted within the specified period of 3 months and liability for payment of interest by the Government was thereby obviated. 2. The board desire that the CsIT/Addl.CsIT should ensure that the AACs send to them the fortnightly batches of their appellate orders promptly for processing and allowing consequential refund well in time to avoid payment of interest. The AACs may please be advised in this behalf accordingly and a close watch kept over the timely receipt of the fortnightly batches of appellate orders from them. Any inordinate delays may be pointed out to the AACs and in case of persistence, necessary notice may be taken and the matter also intimated to the board.