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TMI Blog1988 (12) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... cumstances of the case, and having regard to the second proviso to section 244(lA), the Appellate Tribunal was right in law in holding that the order of the Income-tax Officer granting interest under section 18 of the Surtax Act read with section 244(lA) of the Income-tax Act are not prejudicial to the interest of the Revenue and on that ground setting aside the order of the Commissioner of Income-tax ?" The facts of the case are as follows : The assessee (respondent) is assessed under the provisions of the Companies (Profits) Surtax Act, 1964. For the assessment years 1971-72, 1972-73 and 1973-74, the assessee became entitled to refund of tax as result of revision of assessments consequent to the reliefs obtained in the computation o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the proviso, what is excluded from payment of interest is the one month period and it cannot be construed as to provide for payment of interest Only when the refunds are belated, beyond one month from the date of the order giving rise to the refund. In other words, according to the Tribunal, the assessee would be entitled to interest from the date of the payment of tax to the date of refund and from that period, one month will be deducted. In this view, the Tribunal set aside the order of the Commissioner and restored the order of the Surtax Officer for all the three years. It is as against this, the Revenue has filed these petitions for a reference on the question of law set out above. The Tribunal while dismissing the applications un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een the two sections. Under section 244(1), the interest is to be paid on the amount of refund due from the date immediately following the expiry of the period of three months, whereas, under section 244(lA), proviso, no interest shall be payable for period of one month from the date of the passing of the order. This later provision clearly indicates that Parliament in its wisdom intended to give the benefit of interest to the assessee from the date of payment of tax except for a period of one month. Even accepting for a moment that the provisions can be read either way, it is well-settled that a construction which is favourable to the taxpayer will have to be taken. Only in this context, the circular of the Board is relevant. We are of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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