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TMI Blog2025 (3) TMI 657X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Vivad se Vishwas Act, 2020. By an order of assessment under Section 143 (3) of the Income Tax Act, 1961 for the assessment year 2016-17, the assessee was assessed to a total income of Rs. 1,86,80,000/-, which includes an addition of Rs. 75,00,000/- as unexplained investment. In the meantime, the assessee filed a declaration and undertaking under sub-Section (5) of Section 4 of the Direct Tax Vivad se Vishwas Act, 2020 ('Act', for short). On filing of the said undertaking and declaration, a certificate was drawn by the Assistant Commissioner of Income Tax, Central Circle-I, Kozhikkode showing that the assessee was entitled for a refund of Rs. 28,81,185/-. Immediately thereof, the Principal Commissioner of Income Tax, Kochi issued a certificate in Form-5 on 24.11.2021 under sub-Section (2) of Section 5 of the Act. Thereafter, on 29.11.2023, the Assistant Commissioner of Income Tax, Central Circle-I, Kozhikkode passed Ext.P4 order giving effect to the refund, but however denying interest. Aggrieved by the said order, the assessee filed a grievance petition on 8.1.2024 which was answered by stating that any amount paid in pursuance of a declaration made under Section 4 shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "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 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,- (i) from the 1st day of April of the assessment year to the date on which the refund is granted, if the return of income has been furnished on or before the due date specified under sub-section (1) of section 139; or (ii) from the date of furnishing of return of income to the date on which the refund is granted, in a case not covered under sub-clause (i); (aa) where the refund is out of any tax paid under section 140A, 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 date of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... serve on the assessee a notice of demand in the prescribed form specifying the amount of the excess interest paid and requiring him to pay such amount; and such notice of demand shall be deemed to be a notice under section 156 and the provisions of this Act shall apply accordingly. (4) The provisions of this section shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1989, and subsequent assessment years: Provided that in respect of assessment of fringe benefits, the provisions of this sub-section shall have effect as if for the figures "1989", the figures "2006" had been substituted. Explanation.-For the purposes of this clause, "date of payment of tax or penalty" means the date on and from which the amount of tax or penalty specified in the notice of demand issued under section 156 is paid in excess of such demand. (1A) In a case where a refund arises as a result of giving effect to an order under section 250 or section 254 or section 260 or section 262 or section 263 or section 264, wholly or partly, otherwise than by making a fresh assessment or reassessment, the assessee shall be entitled to receive, in addition to the int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y settling the dispute." Sub-Section (2) creates an obligation on the declarant to pay the amount determined under sub-Section (1) within fifteen days of the date of receipt of the certificate. 9. Section 7 of the Act reads as under: "7. No refund of amount paid.-Any amount paid in pursuance of a declaration made under section 4 shall not be refundable under any circumstances. Explanation.-For the removal of doubts, it is hereby clarified that where the declarant had, before filing the declaration under sub-section (1) of section 4, paid any amount under the Income-tax Act in respect of his tax arrear which exceeds the amount payable under section 3, he shall be entitled to a refund of such excess amount, but shall not be entitled to interest on such excess amount under section 244A of the Income-tax Act." Section 7 speaks about refund of any amount paid in pursuance of a declaration made under Section 4. The contention of the Revenue that once a declaration under Section 4 is accepted, the excess amount, if any, found though has to be refunded, the assessee cannot claim interest, appears to be far fetched for the reason that we could not find any absolute prohibition under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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