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TMI Blog2017 (8) TMI 1591X X X X Extracts X X X X X X X X Extracts X X X X ..... has held in the case of Clough Engineering Ltd. [ 2011 (5) TMI 562 - ITAT, DELHI] that interest on income tax refund is taxable under Article 11 of the DTAA. The Revenue has originally deducted TDS on the interest granted u/s. 244A of the Act at the rate prescribed under Article 11 of DTAA, which is correct as per the decision rendered by the Special bench. Further the Coordinate Bench has held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee is allowed. - I.T.A. No. 4770/Mum/2015 - - - Dated:- 2-8-2017 - Shri B.R. Baskaran (AM) Shri Ravish Sood(JM) Assessee by Shri Madhur Agarwal Department by Shri M.V. Rajguru ORDER B.R. Baskaran (AM) :- The appeal filed by the assessee is directed against the order dated 19.3.2015 passed by the learned CIT(A)-55, Mumbai and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct of ₹ 90,44,282/-. The said interest was subjected to TDS as per Article 11 of DTAA with the view that the interest on income tax refund is liable to be taxed at the rate prescribed in Article 11 of DTAA @ 15%. The Assessing Officer took the view that interest granted by the Income Tax Department is taxable under Article 22 of DTAA and hence tax should have been deducted at higher rate of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h also noted that the ITAT (Special Bench) Delhi has held in the case of ACIT Vs. Clough Engineering Ltd. (2011) 130 ITD 137 that interest on income tax refund is taxable under para 2 of Article 11 of the DTAA. 4. We have heard learned Departmental Representative and perused the record. We noticed that the Special Bench has held in the case of Clough Engineering Ltd. (supra) that interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer is beyond the scope of provisions of section 154. Accordingly, we are of the view that the learned CIT(A) was not justified in confirming the order passed by the Assessing Officer u/s. 154 of the Act. Accordingly, we quash the orders passed by the tax authorities on this issue. 6. In the result, appeal filed by the assessee is allowed. Order has been pronounced in the C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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