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2014 (11) TMI 899 - HC - Income TaxInterest payable u/s 244A(1)(b) on refund of excess amount – Excess amount paid on self-assessment u/s 10A – Held that:- Amount paid by the petitioner as tax on self-assessment would not stand covered by Section 244A(1)(a) - the payment of tax made by resident/ depositor is in excess and the department chooses to refund the excess payment of tax to the depositor - the interest requires to be paid on such refunds - In the absence of an express provision as contained in clause (a), it cannot be said that the interest is payable from the 1st of April of the assessment year - the requirement to pay interest arises whenever an amount is refunded to an assessee as it is a kind of compensation for use and retention of money collected by the revenue. The payment has not been made pursuant to any notice of demand but prior to the filing of the return of income in accordance with Section 140A of the Act - Secondly, the provisions of Section 244A(1) (b) very clearly mandate that the revenue would pay interest on the amount refunded for the period commencing from the date the payment of tax is made to the revenue upto the date when refund is granted to the revenue – relying upon Karnataka High Court in Commissioner of Income Tax v/s Vijaya Bank [2011 (7) TMI 582 - KARNATAKA HIGH COURT] - interest is payable from the date of payment of the tax on self-assessment to the date of refund of the amounts u/s 244A – thus, the order is set aside and the AO is directed to compute the interest payable from the date of payment on self-assessment tax i.e. 31 August 1994 till the date of refund i.e. 24 October 1998 – Decided in favour of assessee.
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