9911796707
TMI Blog2016 (6) TMI 1218X X X X Extracts X X X X X X X X Extracts X X X X ..... CBDT circular no.11 of 2016 dated 26th April 2016, we hold that the assessee is entitled to receive interest on excess TDS refunded to him from the date of payment. Interest on interest - Held that:- The primary facts relating to the payment of excess TDS to the Government account as well as claim of interest on refund are available in the records of the Department, therefore, the legal issue pertaining to the assessee’s claim of interest on interest can be decided on the basis of those facts. In that view of the matter, the learned Commissioner (Appeals) was not justified in rejecting additional ground raised by the assessee. We, therefore, restore this issue back to the file of the Assessing Officer for deciding assessee’s claim of interest on interest in the light of the facts and material on record and in consonance with the relevant statutory provisions as well as the decisions which may be relied upon by the assessee. Accordingly, ground no.3, is allowed for statistical purposes. - ITA no.4193/Mum./2014 - - - Dated:- 16-6-2016 - SHRI SAKTIJIT DEY, JUDICIAL MEMBER, AND SHRI N.K. PRADHAN, ACCOUNTANT MEMBER For The Assessee : Shri K.B. Desai For The Revenue : Shr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted LIFL has neither shown the interest received as income nor claimed any credit of TDS in the return of income. The assessee also furnished an indemnity bond before the Assessing Officer in support of the aforesaid claim. Ultimately, the Assessing Officer completed the assessment accepting the income declared in the return of income. After completion of assessment, the assessee on 29th November 2007, applied for refund of TDS amount of ` 29,27,400, mistakenly deducted and remitted to the Government account. Thereafter, the assessee went on filing several letters before the Departmental Authorities requesting for grant of refund. Since none of these letters were responded to by the Departmental Authorities, the assessee on 1st June 2012, filed a petition before the Ombudsman claiming refund of TDS amount along with interest. On the basis of petition filed by the assessee, the Ombudsman vide letter dated 5th June 2012, called for a report from the Assessing Officer on assessee s claim. The Assessing Officer vide letter dated 8th August 2012, intimated the assessee that against refund claim for ` 29,27,400 certain demands relating to assessment year 2007 08, were to be adjusted. U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equired to deduct tax at source, however, due to a mistake assessee deducted tax on interest payment and remitted to the Government account. Learned Authorised Representative submitted, even the Department has accepted the fact that assessee was not required to deduct tax at source and remit to the Government account and, therefore, has refunded back the excess TDS to the assessee. Learned Authorised Representative submitted, thus, it is an accepted fact that the TDS amount was not payable to the Government account. Learned Authorised Representative submitted, there is no dispute to the fact that the assessee has paid the TDS amount to the Government account in the financial year 2004 05 and after filing its revised return and completion of assessment on 28th March 2008, the assessee for the first time claimed the refund in letter dated 29th November 2008 and thereafter has repeated the claim on various occasions. He submitted, since assessee s money was retained by the Department for such a long period, the assessee is entitled to receive interest on the refund of excess TDS in terms of the provision contained under section 244A. Learned Authorised Representative submitted, the ob ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 143(3), the Assessing Officer appears to have accepted the aforesaid claim of the assessee. It is further evident, since November 2007 the assessee has repeatedly raised claim before the Departmental Authorities towards refund of excess TDS paid to Govt. account. However, none of the applications filed by the assessee were considered by the Departmental Authorities. Only after the Ombudsman called for a report from the Assessing Officer, he granted refund of excess TDS after adjusting certain demand relating to A.Y. 2007 08. Thus, as could be seen, though the excess TDS was remitted to the Govt. account by the assessee, may be voluntary in the financial year 2004 05 but the Department granted refund only in August 2012. Thus, it is apparent there was inordinate delay by the Department in granting refund to the assessee. The issue before us is whether the assessee is entitled for interest on delayed payment of refund. The Assessing Officer / learned Commissioner (Appeals) have rejected the assessee s claim of interest on delayed payment of refund on the reasoning that excess TDS was voluntarily paid to the Govt. account, hence, in terms of section 244A, r/w CBDT circulars referre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o a resident/ deductor who has deducted tax at source and deposited the same before remitting the amount payable to a non-resident/foreign company. Providing for payment of interest in case of refund of amounts paid as tax or deemed tax or advance tax is a method now statutorily adopted by fiscal legislation to ensure that the aforesaid amount of tax which has been duly paid in prescribed time and provisions in that behalf form part of the recovery machinery provided in a taxing Statute. Refund due and payable to the assessee is debt-owed and payable by the Revenue. The Government, there being no express statutory provision for payment of interest on the refund of excess amount/tax collected by the Revenue, cannot shrug off its apparent obligation to reimburse the deductors lawful monies with the accrued interest for the period of undue retention of such monies. The State having received the money without right, and having retained and used it, is bound to make the party good, just as an individual would be under like circumstances. The obligation to refund money received and retained without right implies and carries with it the right to interest. Whenever money has been rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e laid down by the Hon'ble Supreme Court it is to be seen that the Department in principle has accepted that excess TDS paid by the assessee is not due to the Department. Accordingly, the amount has been refunded to the assessee. It is equally true that though the assessee had been claiming the refund since the year 2007, there was no apparent effort on the part of the Department to refund the excess TDS paid by the assessee knowing fully well that such money retained by it is without authority of law. That being the case, applying the ratio laid down by the Hon'ble Supreme Court, the Revenue has to compensate the assessee for unauthrisedly holding on or retaining the excess amount paid by the assessee. Therefore, even if the excess TDS was paid by the assessee to the Govt. account voluntarily under misconception, however, as held by the Hon'ble Supreme Court even in the absence of an express statutory provision for payment of interest, the assessee has to be paid interest on refund from the date of payment of such tax. It has further been brought to our notice that the CBDT abiding by the view expressed by the Hon'ble Supreme Court in Tata Chemicals Ltd. (supra) ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
