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2009 (3) TMI 901 - AT - Income TaxTaxability of Interest received u/s.244A - Whether CIT(A) erred in deleting the addition that the order granting interest u/s 244A has not reached finality - return for AY 2001-02 was filed showing loss - assessment order passed u/s 143(3), determined loss - additions made by AO, representing interest on refund allowed by the Department u/s 244A - CIT(A) deleted this addition - ITAT in its order (supra), in the assessee’s own case for the AY 1984-85, decided the issue in favour of the assessee. HELD THAT:- We will proceed to discuss the decision of the ITAT, (SB) in the case of Avada Trading Co. P. Ltd. [2006 (1) TMI 465 - ITAT MUMBAI], held that the interest, granted by the Department to the assessee u/s 244A , along with the refund, fully satisfies the requirements of sections 4 and 5 and, therefore, it has to be taxed in the year of its receipt. The judgment of the Supreme Court in the case of E. D. Sassoon and Co. Ltd. v. CIT[1954 (5) TMI 2 - SUPREME COURT] squarely supports this view. The fact that the quantum of such interest might vary at a later date, because of one of the reasons mentioned in sub-section (3) of section 244A, does not affect this conclusion. Therefore, we respectfully follow the decision of the Tribunal (SB) in Avada Trading Co. P. Ltd [2006 (1) TMI 465 - ITAT MUMBAI] and reverse the orders of CIT(A) on this point and restore those of the both the years. The ground is accordingly, allowed.
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