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TMI Blog2013 (9) TMI 797X X X X Extracts X X X X X X X X Extracts X X X X ..... period also i.e. from 01.04.2006 to 29.02.2008 - Decided in favour of assesee. Assessee is eligible for interest u/s 244A for the entire period for which interest is allowable u/s 244A. There is no period for which the refund was delayed because of reasons attributable to the assessee and hence, no period is required to be excluded for computing interest payable to the assessee u/s 244A. Since, in the present case, the refund is arising partly on account of payment of TDS and advance tax, and the major part of refund is arising out of payment of self assessment tax of Rs.168.30 lacs, interest should be grated to the assessee up to the period 29.02.2008 stating form 01.04.2006 in respect of refund arising out of TDS and advance tax and starting from date of payment of self assessment tax in respect of refund arising out of payment of self assessment tax - Decided in favour of assessee. - ITA No.865, 866,867 & 868/Ahd/2010 - - - Dated:- 14-12-2012 - A K Garodia and Kul Bharat, JJ. For the Appellant : Shri Tushar Hemani, AR For the Respondent : Shri D K Singh, Sr. DR ORDER:- Per: A K Garodia: Out of these four appeals filed by two different assessees, two app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the date of refund and the Id. AO has erred in granting interest from the date of assessment order. 4 Both the lower authorities have erred in law and on facts in passing the orders without properly appreciating the fact and that he further erred in grossly ignoring various submissions, explanations and information submitted by the appellant from time to time which ought to have been considered before passing the impugned order. This action of both the authorities is in clear breach of law and Principles of Natural Justice and therefore deserves to be quashed. 4. Brief facts are noted by Ld. CIT(A) in para 2.1 of his order which is reproduced below for the sake of ready reference: 2.1 In this case, the assessee vide its application dt: 1st June, 2009 requested the A.O. for rectification of mistake u/s. 154 apparent from record while giving effect to the order of ITAT dt: 20-5-09. The main ground for rectification was that while granting the refund, the A.O. has not granted interest payable u/s. 244A of the I.T. Act for the period from 1-4-2006 to 05-5-2009, i.e. on date of payment to date of subject order in the interest of natural justice and equity. In its support, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he basis of profit and loss accounts arrived at from books of accounts regularly maintained and to avoid protracted litigation the amount of contingent income was included to cover any discrepancy which may arise on account of documents impounded. c) The return was filed electronically and in order to explain the facts the assessee had filed a letter on 28-11-06 stating that the contingent amount did not form part of taxable income. d) Relying upon the judicial pronouncements in CIT vs. Cholamandalam Investment Finance Co. Ltd. (2007) 294 ITR 438 (Mad.) and DCIT v. BSES Ltd. (2008) 113 TTJ (Mum) 227, interest u/s. 244A should be allowed from 1-4-06 to 5-5-09. After considering the above submissions, it was pointed out to the assessee that a) If the assessee sincerely believed that a refund was due, it should have filed a return of income without including the amount disclosed (Rs. 7 Cr.) in its total income. Even if such a belief was formed later on, a revised return of income could very well have been filed by the assessee. b) Grant of interest u/s. 244A was governed by Circular No. 549 dt: 31-10-1989. The assessee had to show how the Circular applied to it. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 44A can be allowed to the assessee till the date of passing the order u/s. 143(3). Till that date the delay in determination of refund arose solely due to the ambivalent attitude of the assessee. In view of the above, the A.O. is directed to allow interest u/s. 244A to the assessee from the date of passing or order u/s. 143(3), i.e. 27-3-2008 to the date of granting of refund." The A.O. as per directions given by the CIT-IV, Ahmedabad, has granted refund from the date of passing of order u/s. 143(3), i.e. 27-3-08 to the date of granting the refund (20-5-09), vide his order dated 16-11-2009. 5. Being aggrieved, the assessee carried the matte in appeal before ld. CIT(A) but without success and now, the assessee is in further appeal before us. 6. It is submitted by the Ld. A.R. that the decision of Ld. CIT(A) is on this basis that there is no apparent mistake in the order passed by the A.O. while giving effect to the tribunal order and hence, the same cannot be rectified u/s 154 of the Income tax Act, 1961. The 2nd basis of the Ld. CIT(A) s order is this that the appeal is beyond jurisdiction of Ld. CIT(A) because there is direction of the Ld. CIT u/s 244A(2) of the Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anting of interest for this period cannot be said to be an apparent mistake in the order of the A.O. The A.O. himself has allowed interest for the period form 27.03.2008 to 28.05.2009 as per this very order passed by him u/s 154 and hence, non allowance of interest to the assessee u/s 244A was accepted by the A.O. also as an apparent mistake in the order passed by him u/s 154 and, therefore, Ld. CIT(A) is not justified in saying as per para 2.3 of his order on page 14 that the issue agitated is not a mistake apparent from record which can be rectified u/s 154 of the Income tax Act, 1961. This objection of Ld. CIT(A) is rejected. 8. The 2nd objection of Ld. CIT(A) is this that since there is direction from the CIT u/s 244A(2) of the Income tax Act, 1961, this direction is final and, therefore, no appeal lies before him against this direction of CIT. At this juncture, we reproduce the provisions of sub-section (2) of Section 244A which are as under: Section 244A(2): If the proceedings resulting in the refund are delayed for reasons attributable to the assessee, whether wholly or in part, the period of delay so attributable to him shall be excluded from the period for which in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see in the return of income filed by it, department could not have granted refund to the assessee to the extent of tax payable on such extra income before the date of the assessment order passed by the A.O. u/s 143(3) and, therefore, up to this date, the delay in refund is attributable to the assessee and hence, interest is not allowable to the assessee for this period i.e. 01.04.2006 to 26.03.2008 and the assessment order passed by the A.O. u/s 143(3) is dated 27.03.2008. 11. Reliance was placed by the Ld. D.R. on the judgement of Hon ble Gauhati High Court rendered in the case of CIT Vs Assam Roofing Ltd. as reported in 330 ITR 87. He also placed reliance on the judgment of Hon ble M.P. High Court rendered in the case of Universal Cables as reported in 237 CTR 157. Regarding the first judgement cited by the Ld. D.R. rendered in the case of Assam Roofing Ltd. (supra), we find that in that case, extra income was included by the assessee in the return of income and no objection was raised till the assessment was finalized by the A.O. u/s 143(3) of the Income tax Act, 1961. In the present case, the return of income was filed by the assessee on 27.12.2006 and immediately thereafter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the case of Universal Cables (supra), we find that in that case, the issue involved was regarding granting of interest u/s 244A on refund of TDS to deductor. In that case, the assessee had erroneously deducted tax at source from payments made to IDBI in the absence of any statutory liability to make such deduction. Under these facts, it was held that the subsequent refund of such tax allowed to it can be a refund under the Act but in pursuance to Circular No.285 dated 21.10.1980, the assessee is not entitled to interest u/s 244A on such refund. This judgement is also not applicable in the present case, because in that case it was held that the assessee is not entitled to any interest u/s 244A because refund was not arising under this Act. Whereas, in the present case, refund has arisen as per the provisions of Income tax Act, 1961 and not as per any circular and, therefore, this judgement is also not applicable in the present case. 14. Now, we have seen that none of the judgements cited by the Ld. D.R. is applicable in the present case and the objections taken by Ld. CIT(A) are not valid. We have to decide the merit of the claim of the assessee to grant interest for the period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the first amount i.e. Rs.4,79,284/-, interest is payable for 23 months and for the balance amount of refund of Rs.168.30 lacs, interest is allowable for 20 months i.e. from 26.07.2006 to 29.02.2008. Since admittedly, the issue involved and facts in the present case are similar to the issue involved and facts in the case of Synrefra Engineering Construction Ltd., on the same lines, in the present case also, we hold that the assessee is eligible for interest u/s 244A for the entire period for which interest is allowable u/s 244A. There is no period for which the refund was delayed because of reasons attributable to the assessee and hence, no period is required to be excluded for computing interest payable to the assessee u/s 244A. Since, in the present case, the refund is arising partly on account of payment of TDS and advance tax, and the major part of refund is arising out of payment of self assessment tax of Rs.168.30 lacs, interest should be grated to the assessee up to the period 29.02.2008 stating form 01.04.2006 in respect of refund arising out of TDS and advance tax and starting from date of payment of self assessment tax in respect of refund arising out of payment of se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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