9911796707
TMI Blog2014 (9) TMI 1177X X X X Extracts X X X X X X X X Extracts X X X X ..... obligation to grant interest. However as observed by the Supreme Court in Tata Chemicals Ltd. [2014 (3) TMI 610 - SUPREME COURT] even in the absence of a statutory provision the State is bound to recompensate the person whose money it has used. In the above view the impugned order is set aside to the extent it refused to grant interest to the Petitioner on the sum of 7,50,768/-lakhs being the excess amount already refunded by the Revenue to the Petitioner. However as the Petitioner has restricted his claim for interest on refund of 7,50,768/- only from the date of filing the revision application on 3 October 1997 upto the date the refund of 7,50,768/-was granted. We therefore direct the Assessing Officer to work out the interest payable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 1996-1997 offering additional income of ₹ 12.99 lakhs to tax in the above two Assessment years. Consequently, on 27 March 1997, the Petitioner also filed a revised Return of Income for AY 1995-1996 reducing the Income offered to tax by ₹ 12.99 lakhs as it was offered and subjected to tax in the other two years. However in view of the bar as provided under Section 139 (5) of the Act, the revised Return of Income for AY 1995-1996 was not accepted by the Assessing Officer. 5. Therefore the Petitioner filed an application for Revision to the Commissioner of Income Tax under Section 264 of the Act in respect of AY 1995-1996. In its Revision application the Petitioner pointed out that the original Return of income filed for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Revenue to grant interest on the refund of excess amount paid as tax by an assessee, in this case by the Petitioner for the AY 1995-1996. (b) It is mandated by Section 244A of the Act, that the Revenue would pay interest on any amount which becomes refundable to the assessee. In this case the impugned order dated 9 February 2005 while granting refund refuses / rejects the claim for interest. The impugned order denies the benefit of interest by importing a concept of denial of intent due to a mistake committed by the assessee while making the payment of tax. Section 244A of the Act does not exclude the grant of interest on account of mistake even if committed by an assessee. It is submitted that if mistake deprives an assessee of interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vant provisions of Section 244A of the Act. "244A. Interest on refunds.- (1) Where refund of any amount becomes due to the assessee under this Act], he shall, subject to the provisions of this section, be entitled to receive, in addition to the said amount, simple interest thereon calculated in the following manner, namely :- (a) where the refund is out of any tax paid under section 115WJ or collected at source under section 206C or paid by way of advance tax or treated as paid under section 199, during the financial year immediately preceding the assessment year, such interest shall be calculated at the rate of one-half per cent for every month or part of a month comprised in the period from the 1st day of April of the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tax and the same has been considered on merits resulting in a finding in the impugned order that an amount of ₹ 12.99 lakhs had been offered as income in excess of that which was attributable to AY 1995-96, the question of interest becomes consequential. 13. The Assessing Officer has been given no discretion in the matter of granting interest. The amount of interest has to be paid to an assessee in terms of Section 244A of the Act. The only limitation provided therein under Section 244A of the Act is under sub-section 2 thereof which mandates that where any refund results to an assessee, while computing the interest payable thereon, the delay which is attributable to the assessee, in obtaining the refund would be excluded. The Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attributable to the assessee. In this case the impugned order does not attribute any delay to the assessee in the proceedings of Revision resulting in the refund. Further the Apex court in Tata Chemicals Ltd. (supra) has held that under the Act interest payment is a statutory obligation and non-discretionary in nature both for the assessee as well as for the Revenue. Further the Apex Court held that : "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 S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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